UNIQLO is one of Japan's world-renowned brands outside the automotive and electronics industry. The company has nearly 190 stores in Korea and sells about 140 billion yen (US $1 billion 300 million) clothing annually, accounting for 6.6% of its total revenue.

Uniqlo boycotted Japanese products and affected the sale of Uniqlo, a casual wear chain, in South Korea last Friday. The company stressed that the impact of the diplomatic dispute surrounding Japan's role in the war is expanding.

Japan decided last month to tighten export controls on raw materials used for manufacturing semiconductors and smart phone monitors in South Korea, triggering a strong rebound in South Korea, from beer to pens, and consumers boycotting Japanese products.

The relationship between the two US allies is at its lowest level in decades. The root of the dispute is the compensation of forced labor in Japan's occupation of Korea. Korea has repeatedly mentioned the difficult history of Japan. During World War II, Japan was colonized on the Korean Peninsula.

"We can confirm that sales in South Korea have been affected," said a spokesman for Fast Retailing, UNIQLO. She declined to give specific figures.

The spokesman said the company recently decided to close a store in Seoul, irrespective of its boycott. She also said that the contract of the property had been terminated and the company decided not to renew it.

Japan says these restrictions are for safety reasons. However, this is also seen as revenge. Last year, a court in South Korea ordered Japanese businesses to compensate Koreans who were forced to work for Japanese occupants during World War II.