Coupang’s U.S. shareholders say they suffered losses due to Korean government, file ISDS notice of intent to arbitrate

[Financial News] U.S. investment institutions that hold shares in Coupang have submitted a notice of intent to arbitrate under Investor-State Dispute Settlement (ISDS), claiming they suffered losses because of the Korean government’s fact-finding investigation following a massive personal data leak at the company.
According to the Ministry of Justice of the Republic of Korea on the 23rd, Greenoaks Capital and Altimeter Capital, U.S. firms that are shareholders of Coupang, submitted a notice of intent to arbitrate to the Korean government on the 22nd under the United States–Korea Free Trade Agreement (KORUS FTA).
A notice of intent to arbitrate is a written document sent to the respondent state before a formal arbitration is filed. The claimant may initiate formal arbitration proceedings 90 days after serving this notice.
The investors argue that, after the Coupang personal data leak incident, Korea’s National Assembly and executive branch broadly targeted Coupang with fact-finding investigations, various administrative measures, and threatening remarks. They claim these actions violate provisions of the KORUS FTA.
In response, the Ministry of Justice of the Republic of Korea stated, "Centering on the International Investment Dispute Response Team, we will establish a joint response system with relevant agencies and thoroughly review the legal issues related to the notice of intent to arbitrate," adding, "We will respond actively, including disclosing relevant information, in order to enhance the public’s right to know and procedural transparency."
Meanwhile, in the United States, Coupang shareholders have filed a class action lawsuit against the company over the data leak, alleging that "Coupang failed to make the necessary disclosures, causing investors to suffer losses." Last month, Coupang shareholder Joseph Berry filed a securities class action in the United States District Court for the Northern District of California against Coupang, its chairman of the board Bom Kim, and others.
hwlee@fnnews.com Lee Hwan-joo Reporter