Coupang Calls Site Inspection Dispute a Matter of “Procedural Relief,” Says It Did Not Receive Proper Notice

Joo Seong-won, Coupang's executive vice president, appeared before the Fair Trade Commission audit at the National Assembly's committee on political affairs on the 12th and responded to questions from Rep. Lee Kang-il of the Democratic Party of Korea. The audit focused on Coupang's refusal to comply with the Fair Trade Commission's on-site inspection and the company's legal response.

The clash began during an investigation into allegations that costs for customized discount coupons were being passed on to suppliers. On August 19, the FTC conducted an on-site inspection to determine whether there had been a violation of the Act on the Distribution of Large-Scale Retail Business.

Coupang said it did not receive written notice seven days before the inspection and refused to comply with the on-site inspection. It then filed a lawsuit seeking to cancel the on-site inspection decision and requested a stay of execution. Coupang said its refusal to comply with the FTC's on-site inspection and its legal response were aimed at securing the company's procedural rights and remedies. Joo said the response policy was decided after internal discussions among multiple departments.

In response, the FTC emphasized the effectiveness of its investigative powers. It also said it would strengthen procedural fairness in the investigative process.

The FTC said investigations can be conducted without prior notice when there is a risk of evidence destruction. FTC Chairman Joo Byung-ki said investigative authority is the starting point for enforcing fair trade-related laws, and added that the agency would further strengthen the fairness of procedures for exercising that authority. Lawmakers from both parties said that if refusals to comply with investigations spread, they could extend to other companies and make law enforcement difficult.

The court ruled that keeping the effect of Coupang's on-site inspection in place was more consistent with the public interest. The Seoul High Court rejected Coupang's request for a stay of execution on September 23, finding that suspending the inspection's effect would have a greater impact on the public interest than the disadvantage the company would suffer. Coupang filed a further appeal on September 28, asking the Supreme Court to rule on the investigation process and the company's procedural rights, but the further appeal alone cannot once again suspend the effect of the on-site inspection decision.

At the audit that day, the scope of compensation for service disruptions was also on the agenda. Rep. Lee said service outages occurred at Coupang and Coupang Eats on the 9th. He then asked who would be responsible for the loss of sales at partner merchants and the drop in income for delivery workers if only orders placed before the outage were compensated.

Vice President Joo expressed regret to users over the service disruption and said compensation plans had been prepared by category. He also said the finalized compensation details had been announced and that compensation was being carried out according to the guidance provided.

Rep. Lee then demanded that the full compensation plan be submitted to members of the committee before the audit ended. In response, Vice President Joo said he intended to comply with the request.

Source: IT DAILY · Kim Byeong-ju
Original: https://www.itdaily.kr/news/articleView.html?idxno=242130

References

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