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The South Korean government has used its regulatory authority to discriminate against U.S. companies and has waged an unprecedented campaign against online retailer Coupang, according to a House Judiciary Committee report released Wednesday.

The report is the result of an investigation opened by the committee in February. It highlights the treatment of Coupang, which is based in the U.S. but is known as the "Amazon of Asia," and other U.S. companies going back decades.

"South Korea's conduct is part of a broader attempt by foreign governments to weaponize their laws and regulations in an effort to harm American companies and limit their ability to compete in the global economy," the committee, which is chaired by Rep. Jim Jordan, R-Ohio, reported.

The South Korean embassy did not immediately respond to a request for comment on Wednesday.

The committee said in the report that Coupang has been the target of discriminatory pressure from the South Korean government that intensified in 2025 after a data breach perpetrated by a disgruntled former employee.

The company apologized for the breach and its CEO, Park Dae-jun, resigned as a result of the incident.

But according to testimony given to the committee by Coupang's acting CEO Harold Rogers — who took over in December after Park resigned — South Korean officials were informed by the company that same month that the scale of the breach was smaller than initially expected and "that the leak was limited in nature," according to the House Judiciary report. 

Despite that information, the committee found that the South Korean government launched a campaign against Coupang that included dozens of investigations, thousands of document requests, excessive fines and threats of criminal charges against Rogers, who is a U.S. citizen.

According to the committee, the South Korean National Intelligence Service compelled Coupang to send divers on a covert mission to retrieve a laptop used by the disgruntled former employee and that had been discarded in a river in Shanghai, then lied to the public about its involvement in the recovery operation.

"We regret the circumstances that led to the House Judiciary Committee's investigation and we remain committed to finding a constructive resolution so Coupang can once again serve as a bridge to strengthen the U.S.-Korea alliance, accelerating trade and investment that benefits both countries," the company said in a statement.

The result of South Korea's campaign against Coupang has been a more than 40% drop in Coupang's market capitalization, according to the committee, and could have a negative effect on its investors.

"South Korean regulators have consistently targeted Coupang and subjected the company to hostile regulatory treatment, unfair enforcement practices, and disproportionately large penalties not faced by their Korean competitors," the Judiciary report states.

The U.S. and South Korea have had a free trade agreement since 2012. South Korea has been a crucial trade partner for the U.S. in Asia, according to Demetrios Marantis, former acting U.S. trade representative under President Barack Obama, told CNBC.

But the relationship has at times been strained, and other digital companies based in the U.S. — like Google and Netflix — have also at times struggled with South Korean regulators, according to Marantis.

"Korea has had a long history of discriminating against foreign companies, just generally, and being protectionist, and a little bit inward looking," he said. "But the situation with Coupang — I have never seen anything this intense. This much of a whole-of-government assault on one company."

The U.S.-South Korea trade deal was renegotiated in 2025 as part of President Donald Trump's sweeping global tariffs. South Korea negotiated a lower tariff rate with Trump in exchange for investments in U.S. shipbuilding and national security, as well as regulatory rollbacks for American companies. 

In its report, the House Judiciary Committee argued South Korea's actions against Coupang violate the deal.

"South Korea's discriminatory treatment of American-owned businesses directly violates its recent trade agreement with the United States," the report states.