Gmarket-Aliexpress merger gets conditional approval from anti-trust regulator

SEOUL, September 18 (AJP) - South Korea’s Fair Trade Commission (FTC) has conditionally approved the high-profile merger between an affiliate of Shinsegae Group and Chinese e-commerce powerhouse Alibaba Group's Korean unit.

On Thursday, the commission announced its decision to greenlight the merger of Shinsegae affiliate Gmarket and Alibaba's AliExpress Korea, but only under strict conditions designed to prevent the two companies from sharing consumer data and to ensure their platforms operate independently.

The FTC's primary focus was on the potential anti-competitive effects of combining the vast datasets of the two e-commerce platforms. Gmarket holds information on over 50 million members in South Korea, while Aliexpress has global purchase data spanning more than 200 countries.

The commission warned that combining this data with Alibaba's advanced AI and cloud technology could raise market entry barriers, and stifle innovation.

A new joint venture, Grand Opus Holding, was established to house both Gmarket and Aliexpress Korea. The merger followed Apollo Korea, a Shinsegae affiliate, acquiring a 50 percent stake in Grand Opus Holding in January.

The regulator’s concern was particularly pronounced in the rapidly growing domestic online direct purchase market. The FTC noted that the share of Chinese direct purchases has surged, rising from 35 percent in 2022 to 60 percent in 2024. Within this market, Aliexpress holds a leading 37.1 percent share, while Gmarket has a 3.9 percent share. The merger could boost their combined market share to 41 percent.

Lee Byung-geon, the director of the Corporate Merger Review Bureau, emphasized the importance of the ruling. "We will continue to scrutinize the effects of data integration in mergers and conduct in-depth research on its impact on competition and consumer welfare," he stated. "Our goal is to foster innovative investment in the digital era and protect consumer welfare in the online platform market."

* This article, published by Aju Business Daily, was translated by AI and edited by AJP.

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