A South Korean court has approved the sale of assets seized from Japan's Nippon Steel to compensate plaintiffs seeking damages for wartime labor.

In 2018, South Korea's Supreme Court ordered Nippon Steel to compensate South Koreans who say they were forced to work for the firm in Japan during World War Two.

Judicial sources say a district court branch in the city of Daegu on Thursday ordered the sale of the company's shares that were held in South Korea and later confiscated by the plaintiffs. The court decision is the second of its kind in the country.

In another wartime labor case, a district court in September approved the sale of some of the assets seized from Japan's Mitsubishi Heavy Industries. The company immediately appealed.

The Japanese government says any rights to claims were settled completely and finally in 1965, when Tokyo and Seoul normalized ties.

The government argues that the compensation orders issued to Japanese firms and the legal proceedings are in breach of international law, and is urging South Korea to rectify the situation.