- Reducing subcontractors’ burden by specifying the cost-sharing ratio for PB product promotions in contracts -
The Korea Fair Trade Commission (KFTC) decided on August 27, 2025, to initiate consent order procedures for
Coupang Co., Ltd. and CPLB Co., Ltd. (hereinafter “Coupang, etc.”) regarding alleged violations of the Subcontracting Act.
CPLB was established through a spin-off from Coupang on July 1, 2020, and inherited the PB product manufacturing and sales business. Coupang holds 100% of CPLB’s shares.
The consent order system allows a company under investigation to voluntarily propose corrective measures—such as compensation for damages or improvement of trade practices. If the KFTC deems the proposal appropriate after gathering stakeholder opinions, it suspends judgment on the alleged violation and focuses on swift implementation of the corrective plan. The process includes:
decision to initiate procedures → preparation of a provisional consent order → stakeholder consultation → deliberation and adoption of the final order.
The KFTC had been investigating Coupang, etc. for (1) issuing unsigned purchase orders to subcontractors for PB (Private Brand) products, and (2) unilaterally lowering supply prices for 94 subcontractors during unagreed promotional events.
Coupang and CPLB, instead of disputing the KFTC’s findings, applied in March for a consent order aimed at improving subcontracting practices and ensuring prompt relief.
Their proposed corrective measures include:
- Ensuring signatures or seals on contracts and order forms.
- Specifying minimum order quantities (MOQ) and lead times in written agreements for new PB products.
- Requiring prior consultation for promotional events and stipulating that Coupang bears at least 50% of promotion costs.
They also proposed mutual-growth measures worth at least 3 billion KRW (≈ 30 billion won), including:
– Support for PB product development and related expenses,
– Subsidies for discount coupons and online advertising,
– Assistance for trade fair participation and offline promotion,
– Incentives for outstanding subcontractors, and
– Consulting and market-development support.
Additionally, Coupang, etc. plan to establish a regular consultative body to gather feedback and address subcontractor concerns.
Considering the effectiveness of the measures and their proportionality to potential sanctions, the KFTC decided to initiate the consent order procedures.
After refining the corrective plan, the Commission will collect stakeholder opinions, consult relevant agencies, and deliberate on final approval.