As the United States prepares to impose new tariffs on countries next month under Section 301 of the Trade Act, a report from the House of Representatives has emerged alleging that the Korean government continues to discriminate against American-owned firms, including Coupang. Much of the report reflects one-sided claims from Coupang, and controversy is expected.
The House Judiciary Committee published a 35-page report titled "Blocking Competition: Korea's Discriminatory Attacks on American-Owned Companies" on its website Monday, asserting that "Korea has targeted American-owned companies for decades, and the discriminatory treatment has intensified considerably in recent years." More than half of the report is devoted to Coupang's position, and it argues that such discriminatory treatment violates the Korea-US trade agreement.
The report criticized that "discriminatory practices include coercive investigations, excessively heavy-handed regulation, and enormous fines and penalties that punish American companies and hinder competition with Korean firms," adding that "the Korea Fair Trade Commission in particular is aggressive in its attacks on American companies." It relayed complaints from American companies that the Korean government launches investigations based on insufficient evidence and conducts early-morning search-and-seizure operations, failing to observe procedural fairness.
The report also claimed that Korea has weaponized digital-related laws and regulations to prevent American firms from competing effectively in its domestic market. Regarding Coupang's personal data breach, it characterized the incident as "unauthorized access to data systems by a disgruntled former employee" and noted that "Korea escalated the level of its attacks into a 'full-scale government offensive.'" The report also included claims by Harold Rogers, Coupang's interim chief executive, that Korea is trying to poach customers from Coupang and steer them to competitors. It also stated that the process by which Coupang recovered the laptop of a hacking suspect from China was an operation directed by the National Intelligence Service (NIS), and attached an English translation of what it said was a cooperation letter the NIS handed to Coupang.
The report also contained an assertion that a senior Presidential Office official instructed Coupang to cooperate closely with the NIS to recover and hand over the hacking suspect's electronic devices. It included a passage stating that when informed that the electronic devices had been secured in Shanghai, China, the senior official confirmed that President Lee Jae-myung had also been briefed on December 16 last year. The logic was that President Lee was also aware of the circumstances in which Coupang acted on the NIS's instructions.
The report added that Coupang's market capitalization has fallen more than 40% since becoming a target of the Korean government, negatively affecting American investors and harming American businesses that sell billions of dollars worth of products through Coupang each year. It further stressed that Korea's discriminatory practices and hostile regulation could result in losses of $525 billion for the United States and $469 billion for Korea, and could inflict an average of $3,800 in economic damage on American households over the next 10 years.
However, diplomatic circles assessed that the report is not a bipartisan document, given that it names only Republican leaders such as House Judiciary Committee Chairman Jim Jordan and Representative Darrell Issa. Because it lacks the endorsement of Democratic lawmakers, it is highly likely not to represent the view of the full committee.
The House Judiciary Committee summoned CEO Rogers to testify in February. According to an earlier US Senate report, Coupang spent $10.75 million (about 16.8 billion won) on lobbying targeting the US administration and Congress from its Nasdaq listing in 2021 through recently.
