NTS launches full-scale investigation of Coupang's domestic and international transactions

The National Tax Service (NTS) has launched a large-scale tax investigation into Coupang following a massive data breach that affected tens of millions of customers.

The Coupang logo is seen at the firm's headquarters in Songpa District, southern Seoul, on Dec. 9. [NEWS1]

The National Tax Service (NTS) has launched a large-scale tax investigation into Coupang following a massive data breach that affected tens of millions of customers.

On Monday morning, over 150 investigators from the Seoul Regional Tax Office’s fourth investigation bureau and the international transaction bureau were dispatched to Coupang Fulfillment Services in Songpa District, southern Seoul, according to industry sources. Investigators collected accounting and financial documents from the office, which are necessary for the probe. Another team was also sent to a separate Coupang Fulfillment Services office located within Coupang’s Korean headquarters, which is also in Songpa District.

Established in 2016, Coupang Fulfillment Services is a wholly-owned subsidiary of Coupang’s Korean corporation. It oversees key logistics operations such as receiving, storing, packing and shipping at the company’s warehouses.

The fourth investigation bureau is tasked with special tax probes that go beyond regular audits, including investigations into slush funds and tax evasion. While Coupang’s Korean unit underwent a routine audit last year and was not expected to be subject to a special investigation this year, the latest probe into CFS is being viewed as a de facto examination of Coupang’s entire Korean operations.

The involvement of the international transaction bureau suggests that authorities are also scrutinizing profit-shifting arrangements or possible tax evasion involving Coupang’s U.S. headquarters. Coupang is incorporated in Delaware and listed on the New York Stock Exchange. Its executive chairman and largest shareholder, Bom Kim, is a Korean American.

On Nov. 29, Coupang disclosed that the personal data of 33.7 million users had been leaked. The scandal has since snowballed into massive consumer backlash, with users quitting the platform, a boycott campaign gaining traction and lawsuits being filed. Police have begun an investigation, and pressure is mounting from lawmakers as well.

The Democratic Party announced on Monday that five National Assembly standing committees will hold a joint hearing on Dec. 30 and 31 to address the breach.

The NTS declined to comment on the investigation, saying, “We cannot confirm information regarding individual taxpayers or audits.”

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom. BY JANG WON-SEOK [yoon.soyeon@joongang.co.kr]