In 1920, Karafuto was officially designated an external territory of Japan, and its administration and development came under the aegis of the Ministry of Colonial Affairs. Following the Nikolaevsk Incident in 1920, Japan briefly seized the northern half of Sakhalin, and occupied it until the establishment of formal diplomatic relations with the Soviet Union in 1925; however, Japan continued to maintain petroleum and coal concessions in northern Sakhalin until 1944. In 1943, the status of Karafuto was upgraded to that of an "inner land", making it an integral part of the Empire of Japan.