|
|
|
|
|
Newsletter | February 2014, Issue 1 |
|
|
|
|
|
|
ANTITRUST & COMPETITION |
|
|
|
Consent Decree System Introduced in the Amendments to the Act on Fair Labeling and Advertising |
|
|
|
On December 31, 2013, the plenary session of the National Assembly passed the Amendments to the Act on Fair Labeling and Advertising (“AFLA”) which introduces the consent decree system. The consent decree system allows businesses to voluntarily propose corrective measures for their misleading advertisements. Such system allows for a prompt resolution of an investigation and may provide consumers with substantial and immediate relief from such misleading advertisements. The consent decree process under the AFLA amendments is not significantly different from the consent decree process under the Monopoly Regulation and Fair Trade Law (“FTL”).
|
|
|
|
The following are the key features of the consent decree system under the amended ALFA:
|
|
|
|
Applicability
|
|
|
|
The consent decree system is applicable to any violations of the AFLA, except serious and evident violations that require criminal punishment. Also excluded are cases that meet criminal referral requirements under the FTL or where the applicant revokes the application for the consent decree. |
|
|
|
Items to be Submitted
|
|
|
|
Materials that evidence the alleged misconduct; |
|
|
|
Corrective measures (such as suspension of business practices) and measures to remedy consumer misunderstandings; and |
|
|
|
Corrective measures necessary to hold consumers and/or other business operators harmless. |
|
|
|
Process
|
|
|
|
Business operators under investigation by the Korea Fair Trade Commission (“KFTC”) propose corrective measures; |
|
|
|
The KFTC receives public comments on the draft consent decree, particularly from related regulatory bodies or interested parties; and |
|
|
|
The consent decree is finalized after deliberation and approval by the KFTC’s plenary meeting or relevant sub-committees. |
|
|
|
Revocation
|
|
|
|
Revocation may occur:
|
|
|
|
When the proposed corrective measures are no longer appropriate because of significant changes in the related facts, including changes in market conditions; |
|
|
|
When a consent decree is obtained based on incomplete or inaccurate information provided by the applicant or based on any other unjust method; or |
|
|
|
When applicants do not fulfill the corrective measures in the consent decree without any justifiable reason. |
|
|
|
The amendments to the AFLA will come into effect as of April 29, 2014.
|
|
|
|
Back to Main Page |
|
|
|
|
|
If you have any questions regarding this article, please contact below: |
|
|
|
|
|
|
|
For more information, please visit our website: |
|
|
|
|
|
|
|