ACT’s Letter to the House Judiciary Committees on Interim Report of Discriminatory Acts on American Companies

Dear Chairman Jordan and Chairman Fitzgerald,

The Association for Competitive Technology (ACT) represents small app developers, startups, and software companies around the world. We appreciated the opportunity to testify last year in your Committee and Subcommittee on competition frameworks overseas that disadvantage American curated online marketplaces (COMs) and digital platforms. Your sustained focus on this issue helps shine a spotlight on the costs to startups and small business innovators of policy regimes that prohibit basic product integrations, marketplace management, and trust-building activities.

We applaud your July 1 interim report, Closed for Competition: South Korea’s Discriminatory Attacks on American-Owned Businesses, which is a welcome addition to your efforts on these issues. The report brings long overdue and well-documented attention to a pattern small businesses operating in the Republic of Korea (RoK) have described to us directly: a regulatory environment that has grown unpredictable, punitive, and, in important respects, closed to fair competition from American firms.

For the small and medium-sized businesses (SMBs) ACT represents, COMs like Coupang are not just distribution channels. They serve as the digital storefront, the fulfillment network, and often the only realistic path a U.S. small developer or seller has to reach consumers in the Korean market. Our members told us this directly during our visits to Korea last year, that access to a stable, well-governed COM lets a small business inherit a level of consumer trust and market reach that would otherwise take years and capital most SMBs do not have. That access depends entirely on the platform’s ability to operate free of politically motivated interference. The report makes clear that this condition has not been met.

The report’s account of Coupang facing simultaneous scrutiny from four separate agencies, of the Korea Fair Trade Commission’s (KFTC) disproportionate fines relative to its actual share of violations, and of the National Intelligence Service (NIS) directing Coupang to retrieve devices from a river in Shanghai under
threat of criminal exposure illustrates a level of state coordination against a single company that few American companies would survive. Coupang is one of the largest employers in Korea and still absorbed a more than 40 percent decline in market capitalization and a $410 million fine following this campaign.¹

A small developer or seller, which typically has significantly fewer resources, has no comparable ability to withstand such an attack. When a platform of Coupang’s size can be destabilized by government intervention, a SMB operating through a COM in Korea cannot consider its market access secure.

The report’s significance extends beyond this one case. As the Committee documents, the RoK is simultaneously advancing platform legislation modeled on the European Union’s Digital Markets Act (DMA), including the Online Fairness Act and its successor proposals.² ACT has tracked digital platform regulation across 11 Asia-Pacific jurisdictions, and the RoK stands apart for combining aggressive ex-post enforcement with an active push toward DMA-style ex-ante rules. The Committee’s report is a timely and credible warning to other governments in the region that are weighing similar frameworks: the DMA has not delivered its promised consumer benefits in Europe, and layering a comparable regime on top of already assertive competition enforcement compounds cost and uncertainty for the SMBs regulators claim to protect, without a clear competition rationale. The Southeast Public Policy Institute modeled a DMA-style regime applied across nine APEC economies last year, and found that under an ex-ante regime, annual compliance costs would reach roughly $3.07 billion, with about 70 percent, or $2.15 billion, falling on SMBs rather than the large platforms such rules are meant to target.³ Digital platforms and the bundle of services they provide are critical to SMBs’ ability to scale and compete, so government interventions into these markets must be based on demonstrated harms.

The report also documents the trade dimension of this dispute, including the RoK’s obligations under the 2025 Korea Strategic Trade and Investment Deal and Section 301 measures that have followed Seoul’s enforcement conduct.⁴ That escalation is further proof that discriminatory digital regulation is not a contained, domestic policy matter. It carries direct trade consequences, and other trading partners now have a clear, well-sourced record of what those consequences can look like.

ACT appreciates the Committee’s continued oversight of this issue and stands ready to serve as a resource on how discriminatory platform enforcement and DMA-style regulation affect small technology businesses, both in Korea and across the broader Asia-Pacific region.

Sincerely,

Graham Dufault
General Counsel
Association for Competitive Technology (ACT)

1 Kwanwoo Jun, South Korea Fines Coupang $410 Million Over Data-Law Breaches, WALL STREET JOURNAL (June 11, 2026)

2 Kyung-Hwan Chung & Hye Sook Seo, South Korea: Fresh online platform regulations kickstart new era of antitrust law, GLOBAL COMPETITION REVIEW (Nov. 27, 2024)

3 Southeast Asia Public Policy Institute, Digital Platform Regulation in APEC Economies, A Policy White Paper (Sept. 2025)

4 White House, Joint Fact Sheet on President Donald J. Trump’s Meeting with President Lee Jae Myung (Nov. 13, 2025)