Coupang's Mountain View, California headquarters, which was hit with massive fines by the Lee Jae-myung administration. The building also houses the headquarters of the security firm SentinelOne. October 28, 2018. [AP=Fox News]

The U.S. government has expressed significant concern over the online platform regulations currently being pursued by the Lee Jae-myung administration.

On the 27th (local time), the influential U.S. media outlet Fox News reported on simulation model results suggesting that if the South Korean government's proposed online platform regulation bill is passed, it could cause catastrophic economic damage totaling hundreds of billions of dollars across major U.S. states over the next decade.

According to the report, the think tank Competere Foundation, citing the latest economic model estimates, announced that if the "Online Platform Fairness Act"—led by the Korea Fair Trade Commission (KFTC) and supported by the "left-leaning" Lee Jae-myung administration—is adopted, the total loss in economic activity across the U.S. over the next 10 years is estimated to reach $525 billion (approximately 700 trillion KRW).

Furthermore, it is reported that conservative lawmakers in the U.S. Congress are strongly opposing the bill, arguing that it targets American innovative companies while providing an indirect advantage to competitors with ties to China.

Projected Economic Losses by Major U.S. State

Fox News stated that according to the model, major regions such as California, where technology and innovation companies are concentrated, would be hit the hardest.

It also warned that U.S. households could suffer an average economic loss of approximately $4,000 (roughly 6.14 million KRW) per household. The estimated losses by major state are as follows:

▲ Projected 10-Year Economic Loss by U.S. State

California: $123 billion (approx. 160 trillion KRW)

Texas: $48.7 billion

New York: $33.9 billion

Washington: $27.4 billion

Strong Warning from U.S. House Republicans: "Concern Over Discriminatory Policies by an Ally"

About 50 members of the U.S. House of Representatives, led by Congressman Darrell Issa, have collectively voiced warnings regarding these discriminatory policies by South Korea.

A senior U.S. government official stated that Trump is expected to pressure Xi Jinping regarding China’s economic and strategic support for Iran and Russia, including oil revenue, dual-use components, and potential weapons transfers. [Getty Images=AFP]

The lawmakers pointed out that South Korea's new legislative push could disrupt market balance by harming American firms while granting unilateral economic advantages to China-linked competitors.

U.S. Republican Congressman Darrell Issa criticized the move, stating, "Because South Korea is a key U.S. ally and a prime example of economic success, the recent measures to excessively restrict American companies are very concerning. For example, the 20-year ban on Google Maps is a case in point." He argued that the tradition of a free market that has unified Seoul and Washington is being broken by South Korean trade and fair trade authorities.

In an interview with the media last April, Congressman Issa criticized the nature of the policies held by the Democratic Party—which currently holds a majority in the Korean National Assembly—and its leadership, alleging that they are "closely linked to China," and raised suspicions about the political motives underlying these regulations.

Shifts in Korean Politics and Expanding Regulatory Authority

Fox News further analyzed that the shifting political landscape in South Korea, as viewed by U.S. politicians, is a factor exacerbating this conflict.

According to the report, conservative President Yoon Suk-yeol was elected in 2022 but was impeached and ousted following the martial law incident in December 2024. Following the 2025 presidential election, which was won by the left-wing progressive Lee Jae-myung, South Korea is now operating under a system where both the legislature and the executive branch are dominated by the Democratic Party of Korea, forming a progressive government with an overwhelming majority in the assembly.

Supporters of President Yoon Suk-yeol hold a rally in front of the Seoul Supreme Court on April 29, 2026. [AP=Fox News]

Amidst this political transition, a bill to significantly expand the authority of the Korea Fair Trade Commission (KFTC) has been proposed, drawing criticism that it treats U.S. companies unfairly and raises regulatory barriers.

Shanker Singham, CEO of the Competere Foundation and an expert in international trade and competition economics, expressed concern, stating, "South Korea is already becoming an increasingly unfriendly place for American companies to do business, and the upcoming new regulations will worsen that environment."

Perspectives from Security and Trade Experts

Former Utah Republican Congressman Chris Stewart warned that this attitude from South Korea could lead to security ramifications beyond mere trade friction.

"South Korea's campaign against American companies is not just a trade issue. It is a strategic mistake that benefits China," he analyzed. "Every time Korean regulators make it harder for U.S. innovators like Coupang, Google, and Meta to compete, they open space for Chinese firms to expand their influence in one of the world's most important digital economic markets."

Conflict Over Heavy Fines and Data Leaks

Fox News reported that according to a recent editorial in the Wall Street Journal (WSJ) by foreign policy experts Nicholas Eberstadt and Lawrence Peck, tensions between the two countries have reached a peak, with South Korean government officials even raiding U.S. Air Force bases as part of domestic investigations.

In particular, regarding the U.S.-backed innovative commerce company Coupang, the report noted that the South Korean government imposed a record-breaking fine of approximately $410 million (about 500 billion KRW) citing data leaks. Citing an announcement by the South Korean Ministry of Science and ICT, the report stated, "A former Coupang employee of Chinese nationality stole customer information, which included data from American companies and information on South Korean citizens."

In relation to this, Seo Min-sung, a spokesperson for the South Korean Embassy in the U.S., told Semafor in an interview that "the investigation into the Coupang matter was conducted thoroughly, proportionate to the gravity and nature of the data breach, and is entirely consistent with the investigative standards applied to domestic Korean companies in similar cases," denying allegations of discriminatory regulation.

However, 50 U.S. House members sent a joint letter to South Korean Ambassador to the U.S. Cho Tae-yul, expressing deep concern that "many American tech companies are being penalized by discriminatory regulatory measures aimed at protecting local Korean competitors," and urged South Korea not to undermine the free-market values of the U.S.-ROK alliance.

Furthermore, Fox News prominently featured photos of the "Yoon Again" rally taken by an AP reporter, indirectly conveying that South Korean youth do not recognize the Lee Jae-myung regime.

Reporter Im Yo-hee