Coupang to Face Fair Trade Commission Again in Court... Administrative Lawsuit Expected

Disputing the Issuance of 'False Unit Price Document'
"Write the Agreed Price in a Separate Document"

Appeal Filed in High Court Over 3 Billion Won Fine Cancellation

Coupang is once again taking legal action against the Fair Trade Commission (FTC). It intends to seek a court ruling on the FTC’s corrective order decision, which found that Coupang issued documents with false unit prices to subcontractors. In addition, Coupang is preparing for the Supreme Court appeal in a lawsuit challenging the approximately 3 billion KRW fine imposed by the FTC.

On the 22nd, Coupang issued a statement in response to the FTC’s corrective order and a fine of 178 million KRW for violations of the Subcontracting Act. In the statement, Coupang claimed, "We only listed provisional prices under an agreement to prevent exposure of the product unit price information, which is the core competitiveness of the subcontractors," and asserted, "There was no false unit price listed." Coupang further explained, "We prepared a separate document (estimate) with the prices agreed upon with the subcontractors, and since we paid 100% of the agreed prices, no damages occurred."

Earlier, the FTC investigated an incident where Coupang and CPLB commissioned 218 subcontractors to manufacture private brand (PB) products from March 2019 to January 2022, issuing order documents that listed unit prices either higher or lower than the actual subcontracting prices. According to the FTC’s investigation, during this period, the two companies issued 31,405 orders using this method, amounting to 113.4 billion KRW.

The FTC rejected Coupang’s claim that the actual purchase prices were listed in the estimates, stating that these were unilateral declarations of intent. The only documents with legal effect equivalent to contracts are the order forms. The FTC considers the issuance of order forms containing information different from the actual subcontracting transactions as non-issuance of documents. This is because listing false unit prices makes it unclear whether the prices reflect the actual transaction relationship. Accordingly, the legal validity of the estimates is expected to become a key issue in the upcoming litigation.

Coupang is currently engaged in a legal battle with the FTC. This concerns a lawsuit challenging the approximately 3 billion KRW fine imposed by the FTC for alleged abuse of power against suppliers to reduce margin losses caused by the 'lowest price guarantee' policy. Previously, the Seoul High Court ruled in favor of Coupang, canceling the 3.3 billion KRW fine and the corrective order, but the FTC filed an appeal on the 20th, bringing the case before the Supreme Court for a final decision.

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