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Coupang to Face Regulatory Scrutiny Over Alleged Unfair Business Practices, Sexual Harassment
South Korean ecommerce firm warns of new regulatory investigations as it expands geographically.
August 17, 2021
While Coupang (CPNG), a South Korean ecommerce play with a market cap of $57 billion, waits to see if it will be sanctioned following a 2019 probe stemming from a dispute with a vendor, the company revealed it is now the target of a new investigation which aims to determine whether Coupang favors its own brands over those of suppliers.

In its latest 10-Q, Coupang revealed investigators raided one its offices in connection with:

“...a potential violation of the Korean Fair Trade Act, including alleged unfair trade practices in our dealings with suppliers or merchants and the providing of preferential treatment for private labelled products sold by our subsidiary, Coupang Private Label Business (“CPLB”). We are diligently cooperating with these investigations, and actively defending our practices as appropriate.”

Coupang has previously disclosed multiple regulatory investigations over employment and labor issues. However, it appears the scope of those investigations is widening. In its latest quarterly filing, Coupang added the following accusations it may be under investigation for:

“...workplace harassment, workplace sexual harassment…”

Coupang cites China as a key export market. In light of China’s tech company crackdown, investors should also take note of new language Coupang includes in the filing detailing the potential consequences of regulatory violations that also run afoul of trade sanctions which may:

“...restrict or prohibit transactions and dealings (including the sale, supply, or sourcing of products and services) with certain governments, persons, entities, countries, and territories..”
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