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Coupang beset on all sides after data leak sparks full-scale regulatory assault

Published: 12 Jan. 2026, 15:00

JIN MIN-JI
[email protected]

Members of the Korea National Council of Consumer Organizations hold a rally urging Coupang members to quit the service in Jonggak, central Seoul, on Dec. 17, 2025. [NEWS1]

The turmoil at Coupang, triggered by a massive data leak, has become a full-blown regulatory risk, with the New York-listed e-commerce company potentially facing operational suspension amid numerous ongoing investigations, including accusations ranging from data protection failures to unfair business practices and insufficient labor protections.

The investigation also involves multiple government ministries, including the Fair Trade Commission (FTC), the Ministry of Science and ICT and the Ministry of Employment and Labor, as well as the Personal Information Protection Commission, all of which are examining Coupang from various angles.

Most recently, the police summoned Harold Rogers, interim CEO of Coupang, for questioning for the second time as part of an investigation into the company’s alleged wrongdoing, according to the Seoul Metropolitan Police Agency on Monday, after he did not comply with the first request to appear. Former CEO Park Dae-jun appeared last week as a witness over a luncheon meeting last September with Kim Byung-kee, the former floor leader of the ruling Democratic Party.

The police raid Coupang headquarters in Songpa District, southern Seoul, on Dec. 9, 2025, over data leak. [NEWS1]

Alleged violations of FTC regulation

At the center of the crackdown is Korea’s antitrust watchdog, which is investigating four allegations against Coupang, the country's largest e-commerce platform, which disclosed in November that the personal data of 33.7 million users had been leaked.

It is investigating allegations that Coupang unfairly charged advertising fees to third-party sellers and is reviewing possible sanctions. The action in question dates back to 2024, when Coupang is estimated to have received a total of 2.34 trillion won ($1.6 billion) from third-party sellers on its platform in the form of advertising and promotional fees, discount coupons and sales incentives, according to the FTC data. That represents around 9.5 percent of its total direct-purchase transactions.

Such conduct was a violation of the Act on Fair Transactions in Large Retail Business, according to the FTC, which is scheduled to announce the outcome of its sanctions review on the agenda in the coming days.

According to the act, large-scale distributors can receive sales incentives only when the purpose and method of payment have been agreed in advance through a contract. It also stipulates that the portion of sales promotion event costs borne by suppliers must not exceed 50 percent.

Coupang also faces a pending Supreme Court case over the FTC’s 2021 order requiring corrective measures and imposing a 3.3 billion won fine for shifting promotional costs onto suppliers and pressuring them to raise prices on competing platforms.

The authorities could impose various penalties if necessary, "including a suspension of business operations," depending on what information was leaked, the extent of the damage and whether Coupang is taking appropriate measures to remediate the harm," said FTC Chairperson Ju Biung-ghi in late December.

Ju repeated that warning on Monday, saying that the FTC "may suspend Coupang's operations if it fails to comply with an order, or if the authority determines that the order itself does not adequately remedy consumer harm."

The FTC had said in December that it is "pursuing a policy to implement a class-action-like group lawsuit system," noting that such a system is "definitely worth considering." The system allows some victims to file a lawsuit, and if they win, the ruling applies to all affected victims, enabling them to receive compensation as well.

The FTC is also looking into whether Coupang bundled its paid membership, which will be brought to a full commission meeting for review, as well as demanded most-favored treatment from merchants on its food delivery platform and passed costs on to contractors for its private-label brand products. Coupang’s service expands to over-the-top services and food delivery apps, all included in its Wow membership subscription.

“Coupang was able to grow to this extent because the legal framework to regulate online distributors has been insufficient,” said Choi Chul, a professor of consumer economics at Sookmyung Women’s University. “There was considerable discussion in the previous National Assembly on an online platform act, but it ultimately failed to pass. As new platform-based business models have emerged, regulatory frameworks need to be established to reflect the new economic environment shaped by platform structures.”

A Coupang deliveryperson moves packages at a warehouse in Seoul on Dec. 16, 2025. [NEWS1]

The Coupang incident revived calls to pass the controversial Online Platform Act, which seeks to regulate large digital platforms to ensure fair competition and consumer protection. The legislation was also one of President Lee Jae Myung’s campaign pledges, but stalled after the United States singled it out as a form of digital regulation.

Financial and data leak accusations pending

Scrutiny from other regulators is also intensifying.

The Financial Supervisory Service (FSS) on Wednesday sent a notice to Coupang Financial, its financial unit, to launch an official audit over its high-interest loan product following a preliminary inspection.

Since December, the FSS has conducted an on-site inspection of Coupang for charging high interest rates on loans to sellers by leveraging its dominant market position. The company charges rates of up to 18.9 percent annually on loans of up to 50 million won, based on merchants’ sales performance on the shopping platform.

Harold Rogers, interim CEO of Coupang Korea, answers lawmakers’ questions at a joint parliamentary hearing on Coupang's personal data leak, unfair trade practices and labor conditions at the National Assembly in Yeouido, western Seoul, on Dec. 30, 2025. [NEWS1]

FSS Gov. Lee Chan-jin said last month that the financial watchdog would formally seek cooperation with the U.S. Securities and Exchange Commission regarding key executives’ sales of shares worth millions of dollars between the company’s data breach and its public disclosure, if potential signs of unfair trading are confirmed.

In December, the National Tax Service also launched a special audit of Coupang, involving potential tax evasion and unfair profit transfers to its U.S. parent company.

Other government ministries are also actively probing the e-commerce giant through a task force on Coupang's security breach and personal data leak.

The Ministry of Science and ICT is focusing on the cause of the incident and Coupang's security flaws, while the Personal Information Protection Commission is focusing on the scale and the scope of the data leak, as well as the potential violations of the Personal Information Protection Act.

The issue has reached the Ministry of Employment and Labor, which has pledged to take strict action against Coupang over suspected violations of labor and industrial accident laws. The ministry plans to investigate reports that Coupang engaged in illegal worker dispatch and implemented programs targeting the dismissal of low-performing employees.

“Whether to leave Coupang should be left to consumers to decide," said Suh Yong-gu, a professor of business administration at Sookmyung Women’s University. "However, Coupang should not overlook that alternative services offering comparable convenience are continuing to emerge and that Koreans tend to have a strong collectivist mindset,” which may lead to stronger boycotts against the platform.

BY JIN MIN-JI [[email protected]]