SEOUL — The head of South Korea’s data protection authority issued a stern directive to Coupang on Wednesday, insisting the e-commerce giant provide a compensation package that is acceptable to the victims of a massive data leak. The demand follows a significant public and political backlash against the retailer’s initial offer of vouchers and discounts, which many critics have characterized as a marketing tactic rather than a genuine remedy.
Song Kyung-hee, chairperson of the Personal Information Protection Commission, addressed the issue during a parliamentary hearing regarding the breach, which compromised the personal information of 33.7 million users—roughly two-thirds of the South Korean population. Song emphasized that the burden of proof regarding the adequacy of the remedy lies with the corporation, stating that it is essential to establish a plan that truly compensates the victims for the violation of their privacy.
The controversy centers on a compensation package unveiled by Coupang on Monday, which promised 50,000 won (approximately $35) in coupons and discounts to each affected user. However, the proposal was met with immediate scrutiny when it was revealed that customers could only spend 5,000 won on Coupang’s primary platform. The remaining 45,000 won in vouchers was restricted to the company’s secondary commerce platforms, including its luxury goods vertical. Legislators and consumer advocates argued that the plan appeared designed to drive traffic and spending toward Coupang’s other business units rather than addressing the damages caused by the leak.
The hearing also touched upon the limitations of current South Korean law regarding collective lawsuits. While Song noted that personal data protection statutes allow for such filings, she pointed out that the current legal framework lack clear provisions for monetary damages, suggesting a need for legislative refinement to provide a firmer legal basis for victim compensation.
Amid these pressures, Harold Rogers, the interim CEO of Coupang’s South Korean unit, testified that the company’s offer would not be used as a legal shield. Rogers, who formerly served as the Chief Administrative Officer of the U.S.-listed parent company, Coupang Inc., assured lawmakers that the vouchers would not contain any “release of liability” clauses. He explicitly stated that accepting the coupons would not require customers to waive their rights to pursue civil or criminal legal action against the firm.
Furthermore, Rogers clarified that the company does not intend to use the distribution of these vouchers as a mitigating factor to reduce potential damages in future litigation. Referencing his experience with the U.S. legal system, Rogers indicated that such voluntary compensation measures would likely not be viewed as a valid reason to lower court-ordered payouts should claims be filed in the future. (Source: IANS)
