Seoul: South Korea's antitrust regulator on Wednesday newly designated Kim Bom, founder of U.S.-listed e-commerce giant Coupang Inc., as the company's de facto controller, placing him under stricter regulatory oversight. Kim, who also serves as chairman of the board, was designated as a "same person" of the group, a legal term referring to the individual who effectively controls a conglomerate, the Fair Trade Commission (FTC) said.
According to Yonhap News Agency, "Substantively, the biggest change will be the disclosure of overseas affiliates," Choi Jang-gwan, a senior FTC official, told reporters. Not only Kim but also his relatives will be required to submit extensive disclosures and comply with detailed investigations by the authorities. The FTC annually compiles a list of large business groups based on their total assets, subjecting them to regulations. The mandatory disclosure system is intended to promote greater transparency in corporate management.
The FTC said Coupang had previously met all requirements for an exception allowing a corporation, rather than an individual, to be designated as the same person. As a result, the company itself had been named the controlling entity. However, the FTC determined through on-site inspections that Coupang no longer met key conditions for the exception, as Vice President Yoo Kim, Kim Bom's younger brother, was effectively involved in management.
In particular, the watchdog said it has found that requirements intended to prevent the misuse of corporate control were not satisfied, citing evidence such as compensation records and business activities. The company has faced increased scrutiny following a data breach incident late last year that authorities say affected 33.6 million users. Coupang, however, said data from only about 3,000 accounts was actually leaked.
The U.S. government has also raised concerns with South Korean authorities over what it views as potentially discriminatory treatment of Coupang and Kim, who is a U.S. citizen. Meanwhile, a total of 102 business groups with assets of 5 trillion won (US$3.4 billion) or more, along with their 3,538 affiliates, were placed on this year's watch list for mandatory filings, the FTC said. A total of 11 groups were newly designated this year, including SK Shieldus Co., internet-only bank Toss Bank, and Kolmar Korea Co., a cosmetics company, it said.