The Korea Fair Trade Commission (the “KFTC”) and the Korea Consumer Agency (the “KCA”) announced that they would strengthen their collaboration by organically linking the KCA’s advertising monitoring activities with the KFTC’s investigative authority. This joint effort aims to more effectively detect and address false or exaggerated advertisements online.
This collaboration stems from the increasing prevalence of unfair labelling and deceptive advertising online, fueled by the expansion of transactions on open markets, intermediary platforms, and social media. The goal is to minimize consumer harm and swiftly correct violations. The details of the collaboration are as follows:
First, before the KCA conducts sector surveys or investigations into advertising practices, it will consult with the KFTC to jointly identify specific areas where sector surveys or inspections are necessary. During these surveys and inspections, the KCA will leverage not only its own personnel, but also utilize multiple channels encouraging participation, such as direct consumer reports and collaboration with relevant organizations.
This year, the KFTC is planning to conduct an ex officio investigation into unfair advertising in the child care products and AI washing sectors, which are already currently being inspected by the KCA. Going forward, the two agencies will remain vigilant in identifying sectors with frequent instances of unfair labelling and advertising, as well as areas warranting further inspection.
If violations are identified during the KCA’s inspection process, the KCA will recommend improvements to encourage voluntary compliance. If the businesses in question do not respond to these recommendations or if significant violations with far-reaching impacts are identified, the KFTC will intervene and commence an ex officio investigation.
During the KFTC’s investigation, the KFTC and the KCA will form a joint investigation team to strengthen their investigative capabilities, actively utilizing the findings of monitoring/inspection initiated by the KCA during the investigation.
In April 2023, the KFTC underwent an organizational restructuring, during which the responsibility for investigating cases related to labelling and advertising was assigned to the Anti-Monopoly Investigation Bureau. Through close and effective cooperation with the KCA, the Anti-Monopoly Investigation Bureau is expected to conduct its investigations into false and exaggerated online advertising more efficiently, leading to the rapid resolution of such cases.
In summary, by actively leveraging the KCA’s unfair advertising monitoring system, the KFTC is anticipated to enhance its monitoring functions, and is allowed to concentrate its investigative powers to more important and significant cases. At the same time, businesses will continue to be encouraged to promptly address minor issues voluntarily through the KCA’s improvement recommendations.
