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A Coupang banner hangs outside the New York Stock Exchange on the day of the company's initial public offering, March 11, 2021. NYSE
The South Korean government's dismissal of the findings of a congressional report alleging it's waged a targeted campaign against U.S.-based Coupang — commonly known as the Amazon of South Korea — is straining the relationship between the two global allies, officials in Congress and people close to the company told CNBC. CNBC spoke with nearly a dozen people familiar with the Coupang-related tensions, some of whom asked not to be named in order to discuss sensitive matters. The company's representatives and supporters on Capitol Hill say they're seeking a quick end to what they describe as South Korea's campaign against the online retailer. People familiar with the situation raised the specter of retaliation from Congress or the White House, including potentially additional tariffs on South Korea, if the dispute drags on. The report by the House Judiciary Committee's Republicans alleges the South Korean government waged an unprecedented offensive on Coupang — which is headquartered in Seattle and does the bulk of its business in South Korea — over a data breach that the company maintains was minimal.
This is really about the relationship between two key allies. Chris Stewart Former GOP congressman from Utah and president of lobbying firm Skyline Capitol, which has consulted for Coupang
The South Korean government disagrees on the scope of the breach and has said consumers in the country faced potential harm from their personal details being exposed. It held hearings, threatened criminal charges against Coupang's interim CEO, and levied a record-breaking data-privacy fine on the company. "This isn't about just some commercial dispute," Chris Stewart, a former Republican congressman from Utah and president of lobbying firm Skyline Capitol, which has a consulting relationship with Coupang, told CNBC about the Coupang issue. "Policymakers, leaders in Congress and the White House understand this is really about the relationship between two key allies." "The worst thing that could happen is if we get into a tit-for-tat environment, where [the U.S. seeks] to punish Korea in some way or tie this to an increase in tariffs. That's not my hope or desire at all," he said. But if South Korea doesn't back down, he said, "ultimately the president has the power of tariffs, which can be very powerful."
The South Korean government, through its embassy in Washington, said its alliance with the U.S. is "stronger than ever" and criticized the congressional report, which the Judiciary Committee released in July, as largely reflecting only Coupang's claims. "The Korean Government has consistently engaged with members of the U.S. Congress and officials of the U.S. administration to explain our position regarding the Coupang matter, and we will continue these efforts going forward," a spokesperson for the embassy said. The Coupang dispute is unfolding against a broader backdrop of friction in the crucial U.S.-South Korea alliance. President Donald Trump on Aug. 16 said he would scale back annual military drills with South Korea. Asked in late August if the move was related to Coupang, a White House official, who asked not to be named in order to discuss the dispute, told CNBC via email that "there is no direct connection." Still, the official cited a Trump executive order from last year that targets foreign governments that the administration says are overregulating U.S. technology companies. "This is not a new focus or issue. That said, the Korean government has been misaligned with us on a number of bilateral issues," the official said.
A U.S. soldier from the 2nd Infantry Division, Stryker Battalion, takes part in river-crossing exercises with the South Korean army in Yeoncheon, Gyeonggi Province, South Korea, March 14, 2026. SeongJoon Cho | Bloomberg | Getty Images
Sen. Bernie Moreno, R-Ohio, last week sent a letter to U.S. Trade Representative Jamieson Greer urging a formal investigation into South Korea, and potentially additional tariffs on the country, over its treatment of Coupang in the aftermath of the data breach, which he called a "regulatory crusade." "This specific data breach deserves investigation and may warrant even-handed enforcement. However, the larger pattern emerging in South Korea is cause for intense concern. Seoul has weaponized a small incident into a pretext for widespread weaponization against American enterprise," Moreno wrote. Coupang spokesperson Erika Reynoso declined to comment on the prospect of tariffs or the specifics of South Korea's response. "We regret the circumstances that led to a congressional investigation, but we acknowledge the Committee's thorough work to bring the facts to light. We continue to seek a constructive resolution that will strengthen the US-ROK alliance," Reynoso said in a statement, using an abbreviation for the Republic of Korea.
Pressure from Coupang shareholders
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