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SAPPORO, Japan - A week after a maritime collision in which seven Japanese fishermen lost their lives, apparently after being hit by an Israeli cargo ship near Japan's Hokkaido Island, the story is still hitting the local headlines. The Japanese media yesterday gave wide coverage to a Haaretz story according to which the captain of the Zim Asia was not awakened by the crew when the Israeli vessel apparently hit the small fishing boat. The Japanese are now demanding to know whether this was a hit-and-run accident.

The management of Zim Israel Navigation has been put in an unfavorable light after declaring on Saturday that the Israeli vessel had not been involved in the crash and then on Monday admitting that it was the Zim Asia that collided with the fishing boat. Even then, Zim management did not admit all the facts.

After a meeting with the Japanese ambassador to Israel, Jun Yokota, Zim's owner, Idan Ofer, said that the captain had been unaware of the collision. Ofer forgot to mention that the captain had been sleeping and was not awakened even though the ship's radar had shown that the fishing boat had changed course suddenly. It was only on the following day that these facts were published.

Zim president Doron Goder announced in Japan yesterday that after the conclusion of an internal investigation, the shipping firm will open negotiations on compensation with the families of the seven fishermen who died in the crash, regardless of the outcome of the Japanese probe. Zim, which has been operating in Japan for decades and has seven agencies there, understands the economic implications of the affair and has hired a Japanese public relations firm.

The firm's decision to order the captain to return home, as well as Goder's apology, are seen in Japan as steps in the right direction.

Goder is due to meet today with the governor of Hokkaido, Japan's northern island, where the fishing boat is based. Tomorrow, he will meet with the bereaved families and offer apologies.

The chairman of the Israel-Japan Friendship Society, MK Ehud Rassabi, blasted Zim's role in the affair. Its initial denial of any involvement, without checking the facts, Rassabi said, damaged Israel's diplomatic standing and reputation in Japan.

Rassabi spoke yesterday with Japan's ambassador to Israel and conveyed the Knesset's condolences to the victims' families.

An official at the Israeli Embassy in Tokyo said that Japanese families accept death more easily if those responsible come to apologize to them. "The most important point in the eyes of the Japanese is an apology from the depths of the heart," the official said. "A father who has lost his son says: `I told my son that soon the director will come and apologize to him.' This is a great help to them."

The most important newspaper in Hokkaido, Hokkaido Shinbun, said that Zim was behaving correctly, especially when compared to other shipping lines that have caused maritime accidents in the past. The paper wrote that it is easy to avoid responsibility under international maritime law but that Zim has assumed full responsibility for the collision.

The next step is the Israeli Transportation Ministry investigation. In Japan, they expect criminal charges to be brought against those responsible.

The Hokkaido Shinbun correspondent who is covering the story pointed out, however, that if the investigation reveals that the crew of the Zim Asia knew they had caused the fishing vessel to capsize and then fled from the scene of the accident, "the negative feelings against Zim will resurface again."

The Transportation Ministry has meanwhile sent its own investigator to Hong Kong, where the Zim Asia was due to dock during the Rosh Hashanah holiday.