Seoul, Jan 23 (NationPress) Two investors from the United States, involved with the e-commerce titan Coupang, have formally communicated their intention to initiate arbitration claims against the South Korean government, citing what they describe as "discriminatory" actions directed at the US-listed company. They have also requested an investigation from the US government regarding the issue.

Greenoaks Capital Partners and Altimeter Capital Management expressed their concerns regarding the South Korean authorities’ inquiries into Coupang, which followed alarming revelations in November about a substantial customer data breach, according to documents submitted by their legal advocate, Covington & Burling LLP, to both governments, as reported by Yonhap news agency.

The South Korean government, together with experts, is conducting an inquiry into the incident that is believed to have impacted around 33.7 million customers. However, Coupang asserts that only about 3,000 accounts had their data accessed.

In a communication sent to President Lee Jae Myung and Chung Hong-sik, the deputy minister for international legal affairs at South Korea's justice ministry, the US investors voiced their plans to file arbitration claims under the South Korea-U.S. free trade agreement. Their equity interests in Coupang exceed US$1.5 billion.

In a separate message to the Office of the U.S. Trade Representative (USTR), they urged Washington to investigate what they termed as "unreasonable" and "discriminatory" actions taken by the Seoul government against Coupang, advocating for "appropriate" trade remedies. They referenced Section 301 of the Trade Act of 1974.

The two investors claimed that the regulatory actions and policy enforcement from South Korea regarding Coupang seem to "far exceed" the scrutiny faced by domestic Korean and Chinese rivals.

According to their joint press release, "As Coupang gained more market share from Korean and Chinese competitors, enforcement actions by various bodies such as the Korea Fair Trade Commission, National Tax Service, Ministry of Employment and Labor, and Financial Supervisory Service, increased significantly. This resulted in hundreds of audits, inspections, and raids, leading to more penalties against Coupang than any other company in Korean history."

They characterized the data breach as a "limited and constrained" event, accusing the South Korean government of making "false and defamatory" statements, alleging that senior officials from the ruling party are attempting to stir public sentiment against Coupang to favor domestic and Chinese competitors.

Furthermore, they argued that the Seoul government’s "targeted and hostile interference" related to the data breach has resulted in billions of dollars in lost market capitalization.

"These losses have been directly absorbed by U.S. shareholders, including individual investors and institutional funds managing the retirement savings of millions of American workers," they stated.

In their notice to the South Korean government, they asserted that as Coupang posed a threat to the traditional dominance of its Korean and Chinese competitors, the Seoul government began "weaponizing the administrative power of the state" and even acted beyond its sovereign capacity to disrupt Coupang's operations.

In their correspondence to the USTR, they noted that South Korean Prime Minister Kim Min-seok had urged regulators in December to pursue enforcement against Coupang regarding the data breach with the same vigor as they would against organized crime.

Founded by Korean American entrepreneur Kim Bom-suk, also known as Bom Kim, Coupang generates approximately 90 percent of its sales within South Korea.