The Fair Trade Commission said on the 10th that it opened a consent decision process in connection with alleged violations of the subcontracting law revealed in the transaction between Coupang and its subsidiary CPLB and subcontractors.
At a full commission meeting on the 27th of 4th, the Fair Trade Commission decided to launch the consent decision process based on a voluntary corrective plan submitted by Coupang and others. A consent decision is a system in which a company proposes its own corrective measures, and if the Fair Trade Commission accepts them, the case is closed without a determination on whether the law was violated.
This case arose from actions such as Coupang and others issuing purchase orders for private-brand (PB) products without signatures or seals, or lowering supply unit prices while conducting promotional events not stipulated in contracts for 94 subcontractors. The Fair Trade Commission has been investigating, viewing these actions as potentially violating the subcontracting law.
Coupang submitted corrective measures aimed at remedying harm and improving transaction order instead of legal disputes. Specifically, the measures include: ▲ mandating signatures and seals on contracts and purchase orders ▲ specifying the minimum order quantity (MOQ) and lead time when placing orders for new PB products ▲ prior consultation on promotions and bearing at least 50% of the expense.
In addition, as support measures for subcontractors, it proposed win-win plans of at least 3 billion won, including: ▲ expenses related to PB product development and delivery ▲ support for discount coupons and online advertising ▲ support for trade show participation ▲ incentives for outstanding companies ▲ consulting and market development. The plan also includes installing a regular consultative body to regularly reflect subcontractor opinions.
Going forward, the Fair Trade Commission plans to work with Coupang and others to prepare a draft consent decision, gather stakeholder opinions, and consult related agencies before submitting it to the full commission. If the final decision is approved, Coupang will implement the corrective measures instead of facing legal sanctions; if rejected, the case will shift to standard sanction procedures.
A Fair Trade Commission official said, "We will flesh out the corrective measures and win-win support plans to prepare a draft," adding, "We plan to determine whether to issue a final consent decision after gathering opinions."