South Korea’s Fair Trade Commission (FTC) approves voluntary corrective measures proposed by Coupang and its private-label affiliate to address allegations of unfair subcontracting practices. Under a consent decree finalized on Tuesday, the FTC approves a remedy package worth 3 billion won. The FTC says it found that Coupang and Coupang Private Label Brands (CPLB) issued contracts to 314 subcontractors that omitted legally required information. It also says that from 2022 onward, Coupang lowered supply prices for 94 subcontractors through discount promotions that were not included in the companies’ agreements. Coupang and CPLB previously sought to resolve the matter without further legal proceedings, and in March of the prior year they submitted a co-prosperity plan aimed at supporting shared growth with subcontractors. The companies’ proposed spending for the corrective measures is described as higher than the level of potential fines discussed during the process. The consent decree allows the companies to settle regulatory concerns without admitting liability while funding measures such as support for subcontractors’ costs and related activities tied to product development and advertising.
FTC approves Coupang’s voluntary remedies over unfair subcontractor deals
South Korea’s Fair Trade Commission (FTC) approves voluntary corrective measures proposed by Coupang and its private-label affiliate to address allegations of unfair subcontracting practices. Under a...
- The FTC approves a voluntary corrective measures package worth 3 billion won proposed by Coupang and Coupang Private Label Brands.
- The FTC says contracts for 314 subcontractors omitted legally required information.
- The FTC says supply prices were lowered for 94 subcontractors via discount promotions not included in agreements since 2022.
- Coupang and CPLB seek settlement through a consent decree to avoid further legal proceedings without admitting liability.
- The approved remedies are aimed at supporting subcontractors, including funding related costs and co-prosperity activities.
The Fair Trade Commission (FTC) has approved a 3 billion won ($2 million) "co-prosperity" remedy package proposed by Coupang to resolve its allegation that the e-commerce giant unfairly slashed supply prices for its private brand (PB) products. The decision will allow Coupang to avoid regulatory sanctions and will instead fund product development, advertising and other related expenses for its subcontractors. Since October 2022, Coupang had been under investigation for violating the Fair Transactions in Subcontracting Act. The company allegedly failed to issue formal, legally compliant contracts to 314 subcontractors. It was also accused of forcing 94 suppliers to fund uncontracted promotional events and cut supply prices for its PB goods. The FTC finalized Tuesday the consent decree for Coupang and Coupang Private Label Brands, which handles manufacturing and sales operations for the retailer’s private brand products. Under the consent decree, companies can settle antitrust cases without admitting liability by offering voluntary remedies. The decision marks the first time a consent dec
9 hours agoSouth Korea's fair trade watchdog on Tuesday approved voluntary corrective measures worth 3 billion won ($1.94 million) proposed by Coupang and its private-label affiliate over unfair dealings with subcontractors. The decision by the Fair Trade Commission (FTC) came after the watchdog's probe found that Coupang and its wholly owned subsidiary, Coupang Private Label Brands (CPLB), had sought a consent decree to resolve the case without further legal proceedings. According to the FTC, the two companies had provided 314 subcontractors with contracts that omitted legally required information and lowered supply prices for 94 subcontractors through discount promotions that were not stipulated in their agreements since 2022. Coupang and CPLB later proposed a set of corrective measures in March last year, including programs worth a total of 3 billion won aimed at promoting shared growth with subcontractors. The amount is far higher than the anticipated fines of 600 million won to 1.1 billion won. In detail, Coupang pledged to provide 1.05 billion won to support subcontractors' costs related to pr
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