South Korea's government on Thursday disputed a U.S. congressional report that accused Seoul of discriminating against Coupang, a U.S.-listed e-commerce company that was fined a record 625 billion won ($403 million) in June for a significant data breach.
The U.S. House Judiciary Committee's report alleged that South Korean antitrust authorities used "coercive investigation tactics" and engaged in a "harassment campaign" against Coupang, suggesting a pattern of escalating discrimination against American-owned businesses operating in the country.
Park Il, a spokesperson for South Korea's Foreign Ministry, expressed regret over the report, stating it appeared to reflect "only Coupang’s unilateral claims" and did not incorporate the South Korean government's perspective. Park asserted that the investigation into Coupang and the subsequent measures were conducted in accordance with domestic law and denied any discriminatory or unfair regulatory treatment.
South Korean authorities emphasized that their handling of the Coupang case focused on addressing the personal data breach and protecting consumers. The Personal Information Protection Commission stated that the breach exposed the personal information of over 37 million individuals, including 33 million Coupang customers. The commission noted that Coupang failed to report the breach within the legally mandated 72-hour period, indicating inadequate security awareness and safeguards.
According to South Korean officials, the breach did not involve sophisticated hacking techniques and could have been prevented. A former Coupang employee reportedly gained unauthorized access to customer accounts using a stolen security key. The company's lax security measures allegedly allowed an unidentified developer to continue accessing customer data even after leaving the company.
Coupang, which is headquartered in Seattle and described itself as a "U.S. technology and Fortune 150 company," has stated it will challenge the fine in administrative court. The company has accused the privacy regulator of not properly considering its efforts to enhance security and prevent further harm. Coupang also expressed a commitment to finding a "constructive resolution" to strengthen U.S.-Korea relations and facilitate trade and investment.
Reports indicate that Coupang has spent over $1 million on lobbying efforts in the U.S. since the data breach scandal emerged in November, engaging with both the White House and Congress.