Tensions are rising in the retail and food sectors ahead of next month's National Assembly audit. With major issues looming—including the Homeplus crisis, collusion in the food industry, and a data breach at Coupang—industry observers worry that the audit will focus solely on criticizing companies rather than establishing institutional solutions, as in previous years.
According to political circles and the retail and food sectors on the 27th, the National Assembly audit will run from the 6th to the 27th of next month. Issues related to the retail and food industries are expected to be addressed by the Ministry of Trade, Industry and Energy and Small and Medium Enterprises Committee (hereinafter referred to as the SME Committee), the Agriculture, Food, Forestry, Fisheries and Ocean Affairs Committee (hereinafter referred to as the Agri-Fisheries Committee), and the Political Affairs Committee (hereinafter referred to as the Political Affairs Committee).
The SME Committee plans to summon Kim Byung-ju, Chairman of MBK Partners, as a witness for the Ministry of SMEs and Startups audit to question him about the Homeplus crisis. Although Homeplus has overcome its liquidation crisis following court approval of its reorganization plan by the Seoul Bankruptcy Court on the 2nd, challenges remain regarding debt repayment and M&A (mergers and acquisitions).
The Agri-Fisheries Committee has summoned Jo Young-sik, Vice President of CJ CheilJedang; Lee Woon-ik, CEO of Samyang Foods; and Park Yun-gi, CEO of Lotte Chilseong, as witnesses. Given that CJ CheilJedang and Samyang Foods were fined by the Fair Trade Commission for collusion in flour manufacturing and sales, as well as starch and starch sugar pricing, questions are expected regarding their related conduct and measures to prevent recurrence. Lotte Chilseong, a major buyer of sugar supplied by sugar refining companies, is likely to face inquiries about the price formation structure in Korea's B2B (business-to-business) sugar market.
Issues related to Coupang are also expected to be key points of discussion during the audits by the Ministry of Science and ICT and the Korea Communications Commission (hereinafter referred to as the KCC) and the Political Affairs Committee. The KCC plans to summon Brett Anthony Mattis, Coupang's CISO (Chief Information Security Officer). In late November last year, Coupang was fined 624.681 billion won by the Personal Information Protection Commission following a personal data breach incident.
While the Political Affairs Committee has not yet confirmed its witnesses, industry observers are focusing on the possibility of Coupang's attendance. The Korea Fair Trade Commission launched an on-site investigation into allegations of violating the "Act on Fair Transactions in Large Retail Stores," but Coupang refused to cooperate, citing lack of prior notice. Additionally, GS Retail and Lotte Home Shopping are expected to face inquiries from the KCC regarding the TV home shopping re-approval system. There is also a possibility that witnesses will be called from Maeil Dairy (where a worker fatality occurred), OurHome, and Starbucks Korea (which faced marketing controversies).
Industry observers express concern that the National Assembly audit may focus more on criticizing corporate CEOs than on developing policy or institutional solutions. Due to intensified partisan conflict between ruling and opposition parties and competition among lawmakers for attention, responses from company representatives are likely to be limited, making it difficult to lead to substantive institutional improvements or follow-up discussions.
In fact, during last year's Political Affairs Committee audit, Kim Byeong-ju (Chairman) faced more criticism regarding allegations of fraud and MBK Partners' market influence than questions about solutions to the Homeplus crisis. Similarly, Coupang representatives who appeared before the SME Committee stated that they were implementing relevant programs to improve settlement methods but continued to face harsh criticism over abusive practices.
An industry representative said, "The reason the atmosphere of the National Assembly audit repeats is because it is filled only with one-sided scolding and criticism directed at companies," adding, "It should become a platform for constructive dialogue between businesses and political leaders to solve problems."
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