Coupang’s Rocket Delivery faces antitrust fine


South Korean e-commerce giant Coupang has been penalized by the nation's antitrust watchdog for allegedly favoring its own private label products, particularly those eligible for its Rocket Delivery service, on its platform's ranking system. The Korea Fair Trade Commission imposed a fine of 140 billion won ($102 million) and initiated legal action against Coupang, accusing the company of engaging in "consumer deception" by promoting its own products and those of major electronics companies it directly purchased for sale, such as Apple's iPhone series and Samsung's Galaxy series, over other products. The commission alleged that Coupang manipulated search rankings and used internal employee reviews to elevate its private label products, contrary to objective search indicators. In response, Coupang criticized the decision as outdated and anti-innovation, arguing that its Rocket Delivery service is a popular choice for consumers due to its affordability and convenience. The company plans to file an administrative lawsuit against the KFTC, claiming that the commission's actions disregard consumer choice. The dispute centers on whether Coupang should have the discretion to recommend products through its algorithm-driven ranking system or if recommendations should be based on market-driven free competition, potentially favoring products from large corporations. The retail industry views the government's actions as de facto regulation on product placement and recommendations, which could impact Coupang's Rocket Delivery service and overall business. The KFTC has pledged to continue monitoring the online shopping market to investigate potential violations of fair competition by companies acting as both marketplace and retailer.


Previous Post Next Post