Coupang Korea Transfers Major Expenses to US Headquarters
Coupang’s audit documents showed that “so-called related-party expenses” paid to the parent company or other US-based affiliates totaled 939 billion won last year. The report also noted that transfers to the US, including service fees and royalties, exceeded 2.5 trillion won ($1.7 billion) between 2020 and 2024.
Industry experts have raised concerns that the arrangement might reduce profits at the South Korean unit while inflating assets at the US parent company. "Dividends are clearly taxable, but service fees and royalties are areas where determining appropriateness is difficult, which is why tax avoidance controversies repeatedly arise," said a tax specialist who requested anonymity.
"Transparency is especially important when transactions involve a parent company."
South Korean tax authorities are reportedly conducting a broad investigation into Coupang, including transactions with its US headquarters. The company has also faced heightened scrutiny following a data breach that regulators estimate may have affected nearly 33 million users. Coupang, however, maintains that only about 3,000 accounts were compromised, a claim contested by authorities.
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