A growing dispute between Washington and Seoul over the treatment of US technology companies has turned into a wider trade confrontation. A White House official told FOX Business that South Korea assured lower tariffs under a trade agreement with the Trump administration, but has not fulfilled its obligations.

“The simple reality is that South Korea reached an agreement with the Trump administration to secure lower tariffs,” the official said. “While the president lowered tariffs on Korea, the Koreans have made no progress in meeting their end of the bargain.”

Coupang, a Seattle-based e-commerce company listed on the New York Stock Exchange, has become one of the most visible examples cited by US officials, lawmakers and investors as scrutiny of South Korea’s regulatory environment has intensified.

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U.S. President Donald Trump (R) and South Korean President Lee Jae-myung speak to reporters before an Oval Office meeting at the White House on August 25, 2025 in Washington, DC. (Chip Somodevilla/Getty Images/Getty Images)

In recent weeks, Coupang’s investors, including major US investment firms, have initiated arbitration proceedings against the South Korean government under trade agreement mechanisms, alleging that regulatory actions have harmed the company’s business and market value.

The investor action helped draw more attention in Washington to concerns that US companies may face unequal treatment under South Korea’s regulatory system.

The White House official emphasized that the administration’s concerns go beyond any one company.

“Our issues with the Republic of Korea’s continued discrimination against major US digital platforms and related service providers are long-standing and remain an area of ​​concern regardless of the ongoing Coupang case,” the official said.

The issue has also drawn bipartisan scrutiny capitol hill.

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An American and South Korean flag hang together in Yongin, South Korea, on August 23, 2016. (Ken Scar/US Army/Handout via Reuters/Reuters Photos)

During a hearing of the House Ways and Means Subcommittee on Trade on January 13, lawmakers from both parties warned that Korean regulators were targeting US companies in ways that could violate US trade commitments.

“Unfortunately, it is my observation that Korea continues to make legislative efforts that explicitly target American companies,” said committee Chairman Adrian Smith, R-Neb. “An example would be Coupang through discriminatory regulatory actions.”

Rep. Suzan DelBene, D-Wash., echoed those concerns: “I’m hearing from companies in my home state of Washington, like Coupang, that (Korean) regulators are already violating (the trade agreement) commitments,” DelBene said.

Only later did the dispute turn into direct commercial action. In a Truth Social post this week, President donald trump said the United States would raise tariffs on South Korean autos, lumber, pharmaceuticals and other goods from 15 percent to 25 percent, citing Seoul’s failure to enact the trade deal due in 2025.

“The South Korean legislature is not living up to its agreement with the United States,” Trump wrote, adding that the agreement was reached on July 30, 2025 and reaffirmed during his visit to South Korea in October

The trade pact includes explicit language intended to prevent discriminatory treatment of American companies, particularly in the technology sector.

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Logos on the facade of the shared headquarters of Internet company Coupang and security firm SentinelOne in the Silicon Valley city of Mountain View, California, on October 28, 2018. (Smith Collection/Gado/Getty Images/Getty Images)

Officials argue that discriminatory pressure on US companies, even by close allies, undermines the economic basis of security partnerships at a time when Washington is asking Indo-Pacific allies to take greater responsibility for countering China.

That theme was echoed this week by Under Secretary of War for Policy Elbridge Colby during remarks in Seoul. “For too long, the security of key regions has relied disproportionately on American resolve and contributions, while many allies have invested little in their own defense,” Colby said Monday.

FOX Business reached out to the South Korean embassy and its foreign ministry for comment, but did not hear back by publication.