CJ Targeted... Coupang Sharpens Focus on Olive Young This Time

Coupang, which is engaged in an all-out battle with CJ CheilJedang, has now turned its sights on CJ Olive Young.

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On the 24th, Coupang announced that it had reported CJ Olive Young to the Fair Trade Commission for violating the Large-scale Distribution Business Act. Coupang claimed, "CJ Olive Young has been engaging in 'gapjil'?abusing its power?by blocking deliveries and transactions to Coupang through small and medium-sized suppliers for years to hinder Coupang's entry and growth in the beauty market." According to Coupang, when a small supplier informed Coupang of its delivery, CJ Olive Young designated the supplier's popular products as a "prohibited product group" that cannot be supplied to Coupang, thereby obstructing deliveries.

Coupang emphasized, "Many suppliers gave up doing business with Coupang due to pressure from CJ Olive Young," adding, "As a result, Coupang suffered significant damage, such as not being able to procure competitive products, which led us to decide to file the report."

Coupang further stated, "Since 2019, when Coupang officially began selling cosmetics, CJ Olive Young has regarded Coupang as a competitor and has continuously obstructed Coupang's entry and growth in the beauty market," adding, "They explicitly prohibit suppliers from delivering to Coupang, impose disadvantages on suppliers who do so, force exclusive transactions on suppliers, and interfere with transactions with other businesses." They claim that CJ Olive Young violated Article 13 of the Large-scale Distribution Business Act, which prohibits dominant distributors from unfairly forcing exclusive transactions that hinder suppliers from dealing with other distributors.

CJ Olive Young flagship store image [Photo by CJ Olive Young].

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Coupang argued, "CJ Olive Young has strong economic power, recording annual sales exceeding 2 trillion won, and 80% of the products handled by CJ Olive Young are sourced from domestic small and medium-sized suppliers," adding, "CJ Olive Young holds a superior bargaining position over its suppliers." They reiterated that from 2019 to recently, due to CJ Olive Young's exclusive transaction coercion, deals with suppliers handling competitive products were repeatedly canceled.

Within the industry, as the Fair Trade Commission is expected to decide as early as next month whether CJ Olive Young is a 'market-dominant business operator' in the health and beauty (H&B) sector, Coupang's recent moves are seen as more sensitive at this point. Some interpret that Coupang, which recently started an all-out battle after ongoing conflicts over supply prices with CJ CheilJedang, has now launched a full-scale fight against the CJ Group.

In response, CJ Olive Young stated, "It is difficult to confirm whether a report has been filed with the Fair Trade Commission," and added, "CJ Olive Young has never restricted partner companies from entering any distribution channels, including Coupang."

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