On March 13, a meeting was held by the Deputy Prime Minister for Economic Affairs where relevant ministries had a discussion on the “Consumer Protection Measures for Users of Overseas Online Platforms” (the “Protection Measures”).

With the recent growth in the number and volume of overseas direct purchases, as well as the rapid increase in consumers’ use of overseas online platforms, concerns over consumer damages and reverse discrimination against domestic platforms have been escalating and became a social issue. Accordingly, on March 7, the Government decided to organize the Task Force (“TF”) for Comprehensive Measures on Overseas Direct Purchase under the auspices of the Office for Government Policy Coordination to jointly respond to these issues with the relevant ministries.

Against such backdrop, the Protection Measures have been prepared as a comprehensive measure to strengthen compliance by overseas online platform operators with their obligations under Korean laws and to prevent and provide remedies for consumer damage. Accordingly, it is expected that various ministries will carry out inspections and surveillance on overseas online platforms, conduct investigations on legal violations, and make a concerted effort to improve relevant systems. In this regard, it would be highly advisable for overseas platform operators to pay close attention to the Government’s policy and enforcement trends. 

The Protection Measures are comprised of Three Major Implementation Strategies and Four Key Items. The key points are as follows.
 
Strict Enforcement of Korean Laws against Overseas Online Platforms
 
With regard to the Four Key Items of concern over consumer damage, the Government announced that it will focus on preventing consumer damage through a joint response system involving relevant ministries as follows, and strengthen its management and enforcement of Korean laws vis-à-vis overseas online platforms.
 

In addition, the Korea Fair Trade Commission (“KFTC”) plans to amend the E-commerce Act to require overseas business operators of a certain size to designate a local agent in order to fulfill their obligations to protect consumers. Further, in order to block the entry of hazardous goods at the customs clearance stage and strengthen the management of items prohibited from importation, the KFTC plans to strengthen overseas risk management activities and upgrade the customs clearance-related risk management system.
 
Establishment of a Pan-Government Response System
 
Considering that consumer damage caused by overseas online platforms is linked to various issues, the Government has decided to establish a pan-government response system with the TF for Comprehensive Measures on Overseas Direct Purchase under the Prime Minister’s Office. The Government plans to regularly inspect the implementation status of the Protection Measures through this TF, thoroughly check the status of direct overseas purchases, and prepare/implement comprehensive measures such as (i) strengthening of safety management by blocking the entry of hazardous goods, (ii) resolving consumer complaints and inconveniences, and (iii) resolving difficulties in related industries.

Furthermore, the Government plans to establish legal grounds for activities by the working-level consultative body for blocking the entry of hazardous goods from overseas by proposing the enactment of the Framework Act on Consumer Safety to effectively respond and expand the scope of authority.
 
Prevention and Relief of Consumer Damage
 
The KFTC and the Korea Consumer Agency plan to proactively prevent and relieve consumer damage caused by overseas online platforms as follows:
 

• Promote consumer damage relief (establishment of a hotline to communicate with overseas platforms, operation of an exclusive window for consumer complaints and dispute settlement, etc.).

• Provide integrated information through the “Consumer 24,” etc.

• Provide prompt response in case of a crisis (e.g., issuance of a warning) when there is risk of serious consumer damage.

• Conduct fact-finding surveys on domestic and overseas platforms to inspect whether they are in compliance with their obligations to protect consumers (e.g., obligations under the E-commerce Act).

• Execute voluntary agreements with overseas platforms to preemptively block the entry of hazardous goods into Korea.
   

• Work in parallel with consumer groups monitoring hazardous goods.