Greenoaks, Altimeter cite broader US probe into discrimination against American tech firms
Two US investors in Coupang – Greenoaks and Altimeter – have withdrawn their petition urging the United States Trade Representative (USTR) to investigate the South Korean government’s handling of the e-commerce platform following a significant data breach in November of last year. The move comes as the USTR signals a broader investigation into potential unfair trade practices affecting US technology firms.
The investors initially filed the petition in January under Section 301 of the US Trade Act of 1974, a key legal tool used to address unfair trade practices imposed by foreign governments, alleging discriminatory practices against Coupang.
“Over the last several weeks, we have had constructive discussions with the USTR that underscored the threat posed by the Korean Government’s actions against US technology firms like Coupang,” said Greenoaks in a press release. The investors highlighted the potential for broader US action as a key reason for the withdrawal.
“USTR has further announced that it expects to initiate broader Section 301 investigations into unfair trade practices affecting American companies, including discrimination against US technology companies and their digital goods and services,” Greenoaks added, suggesting a more comprehensive approach was on the horizon.
Coupang Inc., which owns 100 percent of Korea’s Coupang, is incorporated in Delaware and successfully went public on the New York Stock Exchange in March 2021, making it a significant player in the e-commerce landscape.
The statement also alluded to the previous US administration’s stance, noting that the US government intends to hold Korea accountable and that the USTR will take concrete action to level the playing field for US technology firms, including in response to Korea’s treatment of Coupang.
“Those actions would provide a more comprehensive and powerful approach to address the concerns we raised than a company-specific investigation,” said Greenoaks. “In light of these efforts, pursuing a standalone petition focused on a single company would be redundant, and we have therefore withdrawn it.”
The US investors emphasized that their potential action against the Korean government continues independently, even with the withdrawal of the petition to the USTR. They previously notified Seoul of their intent to pursue an investor-state dispute settlement (ISDS) under the Korea-US free trade agreement, highlighting their commitment to addressing the perceived unfair treatment.
Korea’s Ministry of Trade, Industry and Resources stated Tuesday that despite the USTR’s announcement of a Section 301 investigation into alleged discriminatory treatment of American tech companies, it has not yet received an official notice specifying which countries will be subject to the investigation.
In response to the initial data breach concerns, Korea formed a public-private joint investigative team to conduct a thorough, pan-governmental probe into Coupang’s data breach. While both parties agree that the personal information of 33.7 million user accounts was accessed by a former Coupang employee, Coupang maintains that data from approximately 3,000 of the accounts was retained and subsequently deleted by the perpetrator. The joint investigative team has yet to publicly announce the results of its probe, adding further complexity to the situation.
Seoul has communicated to Washington that the investigation into the Coupang data breach is being conducted in accordance with relevant laws and legal processes, arguing that an isolated incident should not warrant a Section 301 investigation.
hwkan
