Baemin takes dispute with Coupang to the FTC

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Baemin takes dispute with Coupang to the FTC

Food delivery platform Baedal Minjok reported e-commerce firm Coupang to the Fair Trade Commission (FTC) for obtaining its confidential business information and unfair business acts, it announced Monday.

Baedal Minjok - also known as Baemin - is the dominant player in the food delivery market. It said it reported Coupang to the FTC on Friday and requested a police investigation. Coupang, a major e-commerce operator, launched its own food delivery platform, Coupang Eats, on Saturday.

According to Baemin, Coupang asked Baemin’s 50 best-selling restaurant owners to suspend their contracts with the company and sign an exclusive contract with Coupang Eats. Baemin argues the e-commerce firm proposed a 15-percent discount to restaurant owners on their commission fee for a certain period in exchange for the deal and also promised heavy compensation if Baemin sales dip.

Food delivery platforms usually receive commissions from restaurant owners for signing up to use the service.

“Coupang at first seemed to have acknowledged the issue, but is distorting it in the media and blaming us as a market leader that is trying to prevent the entry of a competitor,” said Baemin in a statement. “The core issue here is Coupang’s illegal misconduct.”

In response, Coupang told the Korea JoongAng Daily that some “excessive expressions” may have been used by its salespeople while promoting Coupang Eats to restaurant owners.

“We believe some of our sales people used excessive expressions ahead of the service launch,” said a spokesperson for Coupang. “We’ll strengthen the education of our salespeople and try not to repeat such an incident.”

Coupang said it did not break the law to obtain information on Baemin’s lucrative restaurant partners.

“We did not use illegal means to obtain the information on Baemin’s [high-performing restaurants]. We conducted market research based on the information Baemin unveiled on the number of its orders,” said Coupang.

Baemin claims the sales of restaurants can’t be calculated based on the number of orders, arguing Coupang was able to find high performing restaurants after obtaining Baemin’s sales records, which is confidential information.

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