WWII-era dispute could ensnarl release of 2019 iPhones

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iPhone 11 rumor from Olixar
Apple could feel the fallout from a dispute between Japan and South Korea.
Photo: Olixar

Another dispute between countries looms over Apple, but this one dates back to World War II and could cause the tech giant heartburn as it readies the lineup of 2019 iPhones.

Japan will tighten export restrictions on South Korea for materials used to make smartphone chips and displays beginning Thursday. Japan imposed the rule after a court in South Korea ordered Japan’s Nippon Steel to compensate South Koreans for wartime forced labor.

Japan, according to a report by Reuters news service, called the ruling “unthinkable” and said the issue was settled in 1965 when the countries resumed diplomatic ties.

The restricted materials include fluorinated polyimide, used in smartphone displays; high-purity hydrogen fluoride, an etching gas for building semiconductors; and resist, used to transfer circuit patterns onto a semiconductor substrate.

The materials are critical for producing OLED panels, which Apple gets from South Korean manufacturers LG and Samsung. Two of Apple’s 2019 iPhones are expected to feature OLED panels.

The materials were given a fast-track status through customs, but will now be slowed by a 90-day permit process, Reuters reported.

Japan is the biggest producer of these materials, according to smartphone industry news site phoneArena, and the new rule could force Apple to “scramble” to acquire OLED panels for the initial demand.

It is unknown whether Apple has the chip and OLED panel inventory in place to avoid the new rule impacting soon-to-be-announced new products.

South Korea’s Supreme Court made the compensation ruling against Nippon Steal in October and leaders have not responded to requests from Japan’s government to negotiate.

This comes as China, where the majority of iPhones are assembled, and the U.S. appear to have trade talks back on track.

Source: Reuters> and phoneArena