South Korea's foreign minister has intervened over a provincial proposal to apply stickers to some Japanese-made items in schools as "made by a Japanese firm responsible for war crimes".

South Korea and Japan are both democracies and US allies faced with an increasingly assertive China and the long-running threat of nuclear-armed North Korea.

But their own ties have remained icy for years due to bitter disputes over history and territory stemming from Japan's 1910-45 colonial rule of the Korean peninsula, with forced labour and wartime sexual slavery key examples.

Now 27 members of the Gyeonggi provincial legislature have proposed ordering all schools in the region to put stickers on items such as cameras and photocopiers made by Japanese firms they believe are implicated in abuses.

They have put together a list of 284 companies, including household names like Toshiba, Mitsubishi and Hitachi.

"These Japanese companies caused Koreans serious harm during colonial rule," the label would read, "taking their lives and causing physical harm and financial damage by organising forced labour, among other actions."

Gyeonggi surrounds Seoul and is one of the South's richest provinces, with a population of 12 million people -- almost a quarter of the national total.

Foreign Minister Kang Kyung-wha told the national assembly Thursday that the proposal needed to be "reviewed with caution" and "diplomatic relations should be taken into consideration".

Japan maintains that all historical compensation issues between the two nations were settled under the 1965 treaty that re-established diplomatic relations, which included a reparations package of about $800 million in grants and cheap loans.

Conservative South Korean lawmakers have criticised the proposal, with Kim Jeong-hwa, a spokeswoman for the minor opposition Bareunmirae party saying in a statement: "We urge the ruling party to differentiate the past and the present, as well as our diplomacy and our emotions."

She also accused the Moon administration of spreading anti-Japanese propaganda to "cover up its incompetence."

The Korea Herald newspaper condemned what it called "outmoded nationalism" in an editorial Friday, pointing out that the war ended more than 70 years ago and some companies had since changed hands.

"Their current employees can hardly be said to be related to the war or war crimes," it added.

The dovish South Korean President Moon Jae-in -- who brokered talks between Washington and Pyongyang -- has stressed the independence struggle against Japan is at the heart of national identity in both Koreas, while framing the South's right-wing as the descendants of pro-Japanese collaborators.

Earlier this month, he said: "The task of setting history right is what is needed to help our future generations stand tall."

The Gyeonggi educational department has come out against the sticker proposal, but the provincial assembly is due to discuss it next week. (AFP)