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Tipsheet

House Judiciary Committee Launches Investigation Into South Korea's Treatment of U.S. Companies

AP Photo/Ahn Young-joon, File

The House Judiciary GOP is demanding answers related to South Korea's reported discrimination against American companies. The investigation stems from Seattle-based tech firm Coupang, which is allegedly facing targeted abuse by South Korean politicians.

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Chairmen of the House Judiciary Committee, Rep. Jim Jordan of Ohio and Rep. Scott Fitzgerald of Wisconsin, have sent a letter and subpoena to Coupang as part of that investigation.

Here's some of what that letter says:

Pursuant to the Rules of the House of Representatives, the Committee on the Judiciary has jurisdiction to conduct oversight of matters concerning the “protection of trade and commerce against unlawful restraints and monopoly” to inform potential legislative reforms.1The Committee is conducting oversight of how and to what extent foreign laws, regulations, and judicial orders are being used to discriminate against innovative American companies andinfringe on the rights of U.S. citizens. The Committee has previously expressed concerns about the Korea Fair Trade Commission (KFTC) and its efforts to target innovative American companies and subject them to punitive obligations, excessive fines, and discriminatory enforcement practices to protect their Korean rivals from competition.

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In recent years, foreign governments have taken increasingly aggressive actions to punish innovative American companies through the targeted application and enforcement of digital laws and regulations. In 2022, the EU adopted the Digital Markets Act (DMA), giving the EuropeanCommission the ability to designate certain companies as “gatekeepers,” impose overlyburdensome regulations, and threaten those companies with severe fines and penalties in order to provide their European competitors with an advantage.

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The targeting of Coupang and the potential prosecution of its American executives serve as a sharp escalation of South Korea’s campaign against innovative American-owned companie sand directly conflicts with its recent commitment to avoid discriminatory treatment and thecreation of unnecessary barriers for U.S. digital service providers.21 To this end, to advance our oversight, we require communications between Coupang and the Korean government regardingthe company’s compliance with foreign laws, regulations, judicial orders, or other government-initiated efforts and how these foreign laws affect U.S. companies. We also require that youappear for a deposition with the Committee to answer questions related to the Korean government’s targeting of Coupang and other innovative American companies.

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These investigations signal a shift from diplomacy to formal congressional oversight, as the committee will examine South Korea's regulatory conduct under President Lee Jae-myung. The targeted abuse of Coupang has caused the company to lose billions in revenue and suffer reputational harm. It's also setting a dangerous precedent for how South Korea treats American companies doing business in the nation.

The committee plans to use the hearings to develop effective legislation, including new laws that protect American companies and citizens from discriminatory laws and enforcement decisions by foreign governments.

As part of the investigation, Coupang is being asked to submit all records of communication with the Korean president's office, the government, and the National Assembly. Coupang's executive leadership, including Harold Rogers, Chief Administrative Officer and General Counsel, will testify before the committee on February 23.

According to Fox News, a Coupang spokesperson said, "Coupang will fully cooperate with the U.S. House Judiciary Committee investigation, including production of documents and witness testimony as required by the subpoena."

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