Citizen Group Reports Coupang to Fair Trade Commission... "Item Winner System is an Unfair Practice"

[Image source=Yonhap News]

[Asia Economy Reporter Song Seung-yoon] Civic groups have reported Coupang to the Fair Trade Commission, alleging violations of the Fair Trade Act, the Electronic Commerce Act, and the Act on the Regulation of Terms and Conditions regarding Coupang's terms and the 'Item Winner' system.

On the 4th, the People's Solidarity for Participatory Democracy and the Minbyun Civil Economy Committee held a press conference at the People's Solidarity office in Jongno-gu, Seoul, stating, "We have reported Coupang's unfair and unjust terms and the Item Winner system to the Fair Trade Commission for violations of the Act on the Regulation of Terms and Conditions, the Electronic Commerce Act, and the Fair Trade Act." The press conference was jointly hosted by the People's Solidarity, Minbyun, the National Franchisee Association, the National Network for Realizing Chaebol Reform and Economic Democratization, and the Korea Federation of Small and Medium Business Owners and Self-Employed.

The People's Solidarity explained that Coupang's Item Winner system is a mechanism that exposes the cheapest and highest-rated product on the product introduction page, creating a winner-takes-all system where the seller offering the same product at the lowest price gets everything.

They pointed out, "When a seller becomes the Item Winner, they take over the representative product images, customer inquiries, and reviews posted by the previous seller," adding, "To reclaim the stolen product images, reviews, and star ratings, sellers have no choice but to be selected as the Item Winner again, which forces them into price competition and triggers a chicken game among sellers."

The civic groups criticized Coupang's terms as the background that allows such issues to occur. They stated, "Through its terms, Coupang demands sellers to waive and transfer copyrights on content materials such as trademarks, trade names, logos, text, and images, effectively confiscating copyrighted works without compensation," and added, "In July last year, a review of Coupang's unfair terms was requested to the Fair Trade Commission, but it has been under review for nearly a year."

Furthermore, they emphasized, "The product name, images, customer reviews, and Q&A are important information that influences consumers' product choices," and "Coupang concealed and downplayed the fact that these could belong to sellers other than the Item Winner, increasing the possibility of consumer misunderstanding."

They continued, "To resolve unfair trade practices by online platform operators including Coupang, legislation for the Online Platform Fairness Act is necessary."

This content was produced with the assistance of AI translation services.