Not Guilty!
Recently, the Busan District Public Prosecutor's Office and the Gwangju District Public Prosecutor's Office cleared up suspicions that Coupang might have violated the country’s transport service law by operating its Rocket delivery service. Prosecutors, who have the right of accusation, ruled the company not guilty.
On July 31st, the Busan District Public Prosecutor's Office dismissed charges filed by the Korea Integrate Logistics Association (KILA), which represents the interests of logistics firms, arguing that Coupang violated the Transport Service Act by operating its own delivery system, Rocket Delivery. The prosecution concluded that Coupang did not break the Transport Service Act because it delivered parcels for free to customers who had purchased goods worth more than 9,800 won (US$8.44) through its web site. The company did not comply with requests or provide the service at a cost, so there is no evidence for the suspicion, said the prosecutors. On Sept. 10, the Gwangju District Public Prosecutor's Office also cleared the company of the suspicion.
Coupang introduced Rocket Delivery to send goods to customers in a faster, safer and friendlier manner. With its logistics centers across the country, it is a free home delivery service directly provided by its employees. The KILA filed a complaint with 21 local governments across the nation in May this year, arguing that it is illegal for Coupang to provide the Rocket delivery system at a cost by private cars.
With the ruling of the prosecution and the police, the KILA’s claim of Coupang’s illegality is likely to lose steam. Also, the association will not be able to initiate criminal proceedings against Korea's leading e-commerce site, though it has announced that it will continuously take legal action against the company in the future.
An official from Coupang said, “The rulings of the prosecution and the police are a very meaningful result at the moment, and we will continue to expand and maintain our delivery services in the future within legal boundaries. We hope that customers also consider the fact that our fast Rocket Delivery service has greatly boosted customer satisfaction and has a positive effect on the Korean economy.”
In fact, Coupang has started providing Rocket Delivery services in March last year and hired 3,000 delivery people a year and half after the launch. It is a rare case that a single company operates such a large delivery group.
Meanwhile, Coupang plans to open the nation’s largest e-commerce warehouse on a 99,173 square-meter site in Incheon in 2016. It will also increase the number of its warehouses from the current 8 to 16, and invest in the logistics IT system to build and operate an advanced logistics infrastructure to boost direct delivery efficiency.