U.S. Think Tank Urges Trade Response Over Korean Fines

Logo of the U.S. Information Technology and Innovation Foundation (ITIF), A U.S. think tank pointed out that the Korea Fair Trade Commission has imposed penalty surcharges on U.S. companies that are on average 21 times higher than those on domestic companies, and urged the U.S. government to take trade countermeasures. The argument is that Korea’s enforcement of competition laws and regulations on online platforms are placing a disproportionate burden on U.S. companies. In particular, as the possibility of an investigation and trade retaliation under Section 301 of the U.S. Trade Act is being raised, attention is focused on whether Korea’s platform regulations will emerge as a point of trade conflict between Korea and the U.S. According to a report released on Oct. 19 by the U.S. Information Technology and Innovation Foundation (ITIF), an analysis of the penalty surcharge imposition records of the Korea Fair Trade Commission from 2016 to 2025 showed that the average penalty surcharge for U.S. companies reached approximately 21 times that of Korean companies. The average penalty surcharge imposed on U.S. companies was approximately 39.2 billion won (about $29.58 million), significantly exceeding the Korean company average of approximately 1.9 billion won. The average for the four major domestic groups and their affiliates, including Samsung, SK, Hyundai Motor, and LG, was 14.1 billion won, while the level for Korean companies excluding them was 1.6 billion won. In particular, it was found that 96.5% of the total penalty surcharges imposed on U.S. companies were concentrated on three companies: Qualcomm, Google, and Coupang. Excluding cases of abuse of market-dominating position and the sanctions against Coupang in 2024, the average penalty surcharge for US companies drops to 1.6 billion won. The Information Technology and Innovation Foundation interpreted this as a result showing that high-value sanctions are being concentrated on major U.S. technology companies. However, the gap in penalty surcharges alone does not prove actual discriminatory law enforcement. The Information Technology and Innovation Foundation argued that the Office of the United States Trade Representative should utilize Section 301 of the Trade Act to investigate Korea’s competition law enforcement and platform regulations. Section 301 is a provision that allows for responses to unjust or discriminatory foreign policies and practices that place a burden on U.S. commerce. The Information Technology and Innovation Foundation suggested that if the Korean government does not improve the related systems, response measures such as imposing fees and restrictions on Korean services or suspending trade concessions could also be considered. Trade conflict surrounding Coupang was also presented as a major example. In January of this year, Coupang’s U.S. investors, Greenoaks and Altimeter, submitted a petition for a Section 301 investigation to the Office of the United States Trade Representative, taking issue with the Korean government’s investigations and regulatory measures related to Coupang. The petition in question was withdrawn last March, but the Information Technology and Innovation Foundation argued that the Coupang case demonstrates the need to review the law enforcement of the Korean competition authority from a trade perspective. The report also mentioned the case where the Fair Trade Commission imposed a large-scale penalty surcharge in 2024 regarding suspicions of Coupang manipulating search rankings and its employees writing product reviews. This is to support the argument that sanctions against major U.S. technology companies are excessively concentrated. Korea’s Act on Fair Transactions in Online Platform Intermediary Business was also pointed out as a potential factor for trade conflict. The Information Technology and Innovation Foundation argued that the bill could place a disproportionate burden on U.S. platform companies, as it adds obligations such as contracts and settlements to platform operators and allows for the imposition of penalty surcharges amounting to up to 10% of related sales. It also emphasized that the intent of agreements between Korea and the US must be faithfully implemented so that Korea’s competition law enforcement and platform regulations do not discriminate against U.S. companies. This report is a policy suggestion from a U.S. think tank, and the U.S. government has not actually decided on a Section 301 investigation or retaliatory measures. However, given that arguments to treat the Korea Fair Trade Commission’s sanctions and platform regulations as trade issues are continuing within the U.S., future related discussions draw attention.