- Strict enforcement of domestic laws such as the Electronic Commerce Act and mandatory designation of domestic agents to overseas business operators
- Four major items, including harmful food and medicine, temporary products, harmful media for teenagers, and personal information infringement, are jointly responded by ministries
- Active relief and prevention of consumer damage, such as establishing a hotline, activating information provision, and issuing damage warnings
As the use of overseas online platforms has increased rapidly in a short period of time along with the recent increase in the size of overseas direct purchases*, the number of consumer complaints and disputes has also increased, raising voices that the government needs to actively respond. Rapid measures have been needed to address concerns about reverse discrimination against domestic platforms and to strengthen compliance with the obligations of overseas operators under domestic law, and the need to check and respond to damage situations without partitions between ministries has increased, especially as consumer damage occurs in connection with various issues.
* Overseas direct purchase amount: ('21) 5.1 trillion → ('22) 5.3 trillion (4.1% increase) → ('23) 6.8 trillion (26.9% increase) (Statistics Korea, Online Shopping Trend)
Accordingly, the Fair Trade Commission (Chairman Han Ki-jung, hereinafter referred to as the Fair Trade Commission) announced the Consumer Protection Measures related to Overseas Online Platforms at the 'Emergency Economic Ministers' Meeting' presided over by the Deputy Prime Minister for Economic Affairs on the 13th (Wednesday). This measure is a comprehensive government measure to solve problems in terms of consumers and businesses, and consists of three implementation strategies and four major items.
The main contents of 「Consumer Protection Measures related to Overseas Online Platforms」 are as follows.
First of all, we plan to strengthen management of overseas online platforms so that domestic laws can be enforced without discrimination.
It will strengthen monitoring of violations of e-commerce laws by overseas online platforms and promptly deal with violations of the law. In addition, it will continue to monitor violations of fair trade laws, including restrictions on competition by overseas online platforms to form monopoly status and abuse of trading status for domestic companies. In the case of overseas online platforms, it is true that it is not easy to investigate and sanction whether they comply with domestic laws due to physical limitations even though they are subject to domestic laws, but the FTC will faithfully fulfill its role of investigating and sanctioning violations to prevent consumer damage and establish a fair trade order.
Next, in order to fulfill consumer protection obligations, the revision of the E-Commerce Act will be promoted to mandate the designation of domestic agents to overseas businesses of a certain size or larger. In the case of overseas businesses that do not currently have addresses or offices in Korea, it was difficult to solve them even if consumers were dissatisfied or damaged. In the future, through the revision of the law, we will strengthen management to thoroughly implement consumer protection obligations under the E-Commerce Act regardless of whether or not we have an address or office in Korea.
* Domestic agents of overseas businesses are responsible for relieving ❶ consumer damage and resolving disputes, and are subject to ❷ document delivery and ❸ investigation related to domestic e-commerce law enforcement
A joint response between ministries will also be made to the four major items that are feared to be damaged by consumers. The Ministry of Food and Drug Safety will strengthen management of overseas online platforms, such as requests to block advertisements and special inspections, to respond to illegal distribution and unfair advertisements related to food and medicine.
To prevent damage caused by fake products, the Korean Intellectual Property Office and the Korea Customs Service will strengthen the detection of fake products at the customs clearance stage of overseas direct purchases and promote and expand the introduction of a self-purification system in which overseas online platforms reply results after follow-up when the government provides monitoring details of fake products.
The Ministry of Gender Equality and Family and the Korea Communications Standards Commission will strengthen inspections of whether overseas online platforms have implemented youth protection measures such as age and identity verification when selling adult products to block harmful media for teenagers.
The Personal Information Protection Committee will investigate whether major overseas direct purchase operators comply with the Personal Information Protection Act, and the Korea Communications Commission will respond to the leakage of personal information through overseas online platforms by checking whether overseas online platform operators have notified users of their access to smartphone apps.
In addition, the activities of the overseas hazardous product management working-level consultative body organized by the Fair Trade Commission will be strengthened. Established in February to prevent the inflow of harmful goods into the domestic market due to the activation of overseas direct purchases, the consultative body is a working-level organization for joint monitoring and response to overseas hazardous goods*. In the future, it will prepare regular communication and joint countermeasures between practitioners in charge of blocking harmful goods related to overseas online platforms.
* Seven organizations, including the Fair Trade Commission (supervisor), Consumer Agency (supervisor), Korea Customs Service, National Institute of Technology and Standards, Ministry of Food and Drug Safety, Ministry of Environment, and Korea Product Safety Management Agency
Next, the risk management system related to customs clearance will be advanced to strengthen the management of items that are prohibited from being brought in and block dangerous goods during the customs clearance process. The Korea Customs Service is planning to expand the scope of collaborative inspections for overseas direct purchase goods and establish a smart customs clearance system.
Consumer damage caused by overseas online platforms will be preemptively prevented and damage relief will be actively carried out.
First of all, in the case of consumer complaints and disputes that occur or frequently occur in many people, a hotline between overseas online platforms and consumer sources will be established to respond closely, and a unified response to counseling and dispute settlement will be possible by expanding the overseas online platform consumer complaint-related window (crossborder.kca.go.kr )*.
* Comprehensive consumer portal related to international transactions that provides consumer counseling applications related to international transactions, such as overseas direct purchase, aviation, and OTA (Online Travel Agency), and overseas direct purchase information and damage prevention in international transactions
In addition, information provision will be activated through "Consumer 24 (www.consumer.go.kr )*" so that consumers can know and trade information related to overseas online platforms in advance. First of all, damage cases related to overseas online platforms and damage prevention information are provided through the analysis of consumer counseling data related to international transactions. In addition, it provides consumer toolkits such as foreign language refund forms that consumers can individually use.
* A window that integrates consumer-related information distributed among government, public, and private institutions, and allows a total of 21 government agencies to apply for comprehensive damage relief
If serious consumer damage occurs or is feared to occur, such as the possibility of spreading rapidly to a large number of consumers, we plan to issue a damage warning quickly to minimize related damage.
Meanwhile, a survey will be conducted on domestic and international online platforms to check whether or not consumer protection obligations are fulfilled. Considering the current lack of understanding of whether domestic and foreign online platforms are fulfilling their consumer protection obligations, a consumer awareness survey on online platforms and a comprehensive review of whether business operators fulfill their consumer protection obligations under the Electronic Commerce Act will be conducted, and future system improvements will be derived based on this.
In addition, it plans to sign an autonomous agreement with overseas online platform operators to preemptively block the inflow of dangerous goods into Korea, which are feared to spread damage, such as threatening public safety. Currently, the FTC and the Korea Consumer Agency (hereinafter referred to as the "Consumer Resources") are blocking online distribution of goods to sign an autonomous agreement with seven open markets and four major used trading platforms* ('21.April ~), but some pointed out that overseas online platforms, which are the main channels for distribution of harmful goods, are excluded from the agreement.
* Naver, 11th Street, eBay Korea, Interpark, Coupang, Wemakeprice, Timon (7 open markets, secretary of the Korea Online Shopping Association), Carrot Market, Lightning Market, Secondware, Used Country (4 second-hand trading platforms)
As a result, to prevent the inflow of harmful products in advance, major overseas online platforms, the FTC, and the Korea Consumer Agency will strengthen the management of harmful products by promoting separate autonomous agreements.
Finally, it also plans to monitor overseas online platforms through consumer groups to strengthen monitoring of areas that may cause damage from the perspective of consumers.
The government decided to establish a pan-government response system, recognizing that consumer issues related to overseas online platforms arise in various areas and that it is difficult to respond to complex issues with a single ministry response. Accordingly, this countermeasure will be checked through the "Comprehensive Overseas Direct Purchase Countermeasures TF" (Team Leader: Deputy Secretary of State) in the future.
On the other hand, in order to effectively respond to overseas hazardous products and expand the scope of authority, it will establish a legal basis for the current overseas hazardous product working-level consultative body activities, such as proposing a bill to enact the Framework Act on Consumer Safety.
The FTC said, "We will comprehensively examine related issues and implement related measures at the level of all ministries to prevent consumer damage related to the use of overseas online platforms and ensure that overseas operators faithfully fulfill their consumer protection obligations under domestic law."