Gold wire bonded chips sit on a circuit board inside the Robert Bosch GmbH manufacturing plant in Hatvan, Hungary, on Tuesday, August 23, 2016. (AKOS STILLER / BLOOMBERG)

TOKYO / SEOUL -Japan said on Thursday it was disappointed South Korea was proceeding with a complaint to the World Trade Organization (WTO), a day after the body set up a panel to rule on curbs imposed by Tokyo on exports of some key technology materials to its neighbour.

A Japanese trade ministry official said that Japan believes the issue should be resolved through dialogue and that it is regrettable that South Korea acted in a way that could spoil talks between the two countries

“We think it is extremely regrettable that South Korea has not honoured our agreement to resolve the matter through dialogue and communication,” Mitsuhiro Fukuyama, director of the International Legal Affairs Office at Japan’s trade ministry, said.

“Under present situation, it is difficult to have policy dialogue with South Korea.”

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During a meeting in Geneva Wednesday, the WTO granted South Korea’s request for a dispute inquiry and agreed to establish a panel of three experts to determine if Japan violated WTO rules when it imposed restrictions on three classes of chemicals used in the production of smart-phone displays, TV screens and semiconductors. 

South Korea alleged Japan’s measures “constitute a politically motivated, disguised restriction on trade” that disrupted global value chains for South Korean manufacturers like Samsung Electronics Co and SK Hynix Inc, according to a statement seen by Bloomberg.

It usually takes 10 to 13 months for the WTO dispute settlement body to make a final decision, Seoul said.

The Japanese delegation expressed disappointment at South Korea’s decision to press ahead with the WTO complaint, saying in a statement Tokyo’s measures were intended to enhance control over dual-use items, and thus allowable under WTO rules. It added that bilateral talks were the “best and only way” to resolve the matter.

Trade relations between Tokyo and Seoul soured last year after South Korea’s top court ordered two of Japan’s largest companies -- Mitsubishi Heavy Industries Ltd and Nippon Steel & Sumitomo Metal Corp -- to compensate the families of South Koreans who were forced into labor during World War II.

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The Japanese government said the move was illegal and unsuccessfully called on Seoul to resolve the matter according to a 1965 treaty that normalized relations and included a US$300 million payment.

After the South Korean government rebuffed Japan’s overture, Japan announced its export restrictions and removed South Korea from its list of nations that are exempt from national-security export controls.

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Japan also this week condemned a statue in South Korea that appears to depict Japan’s prime minister, Shinzo Abe, kneeling and bowing to a seated “comfort woman,” a euphemism for women forced to work in Japan’s wartime brothels.