ED Plug antitrust loopholes

Excluding Coupang owner from watchlist gives preference to foreigners

The Korea Fair Trade Commission (KFTC) designated Coupang last Thursday as a large business group with assets of 5 trillion won ($4.48 billion) or more. However, the antitrust watchdog did not name Kim Bom-suk, the founder and chairman of the e-commerce giant, as the group's head because he has U.S. citizenship. Accordingly, Kim, who has a 10.2-percent equity stake in his group and 76.7 percent of the voting rights, is free from the obligation of disclosing his financial transactions with his family members and relatives.

This means that Kim can also dodge regulations on obtaining stakes in, or dealing with, Coupang and its affiliates by his family members and people who have a special relationship with group owners, which are strictly applied to Korean tycoons. “We recognize Chairman Kim's control over his group,” the KFTC said. “However, even if we designate Kim as the group's head, it will have little effects because of institutional loopholes.” The antitrust overseer also pointed out that since Coupang is listed on the New York Stock Exchange and supervised by U.S. regulators, it is under sufficient corporate oversight.

However, Kim is obviously enjoying privileges ― just because he is not a Korean national ― if the government exempts him from antitrust regulations and legal responsibility for the possible violation of labor and environmental laws. Given that most of Coupang's business takes place in Korea and several of its delivery workers have died from overwork, the current laws and systems have too many loopholes. Kim's brother and brother-in-law are now working at Coupang, receiving annual salaries of $100,000, while staying off the KFTC's radar.

In comparison, Lee Hae-jin, chairman of Naver, Korea's largest search engine, has been designated as the group's head subject to various regulations, raising controversy over “reverse discrimination” against Korean entrepreneurs. Considering that more companies will list their shares abroad while operating in Korea as Coupang does, the government should urgently come up proper measures to better deal with the heads of such business groups. Already, Korean companies are reeling under various business barriers overseas. The government should plug the antitrust loopholes to prevent Korean companies from being discriminated against even at home.