🧔♂️ A friendly human may check it before it goes live. More news here
South Korea tightens ecommerce rules, data collection
South Korea’s antitrust regulator, Korea Fair Trade Commission (KFTC), plans amendments to the ECommerce Act to curb data collection and require local agents for some overseas platforms.
Under the changes, platforms handling secondhand trades must verify only phone number and email for personal sellers instead of multiple personal details previously required. The KFTC said aims to address concerns about personal information leaks on platforms following Coupang’s large-scale data breach.
Overseas marketplaces without a domestic address or business location must appoint a domestic agent if they meet any of three criteria, if they exceed revenue or user thresholds set by the regulator, accessing their cyber mall monthly over the preceding three months as of the end of the previous year, or having received a request from the KFTC to submit reports, data, or goods.
The KFTC said penalty surcharges will be increased by up to 50 percent for businesses that repeatedly violate the law even once, and by up to 100 percent for those with four or more violations, and that the reduction rate for penalty surcharges in cases of voluntary correction by businesses has been reduced from a maximum of 30 percent to 10 percent.
🔗 Source: Chosun Daily
🧠 Food for thought
Implications, context, and why it matters.
These rules target consumer-protection gaps linked to fast-growing overseas platforms
- The requirement for local agents responds to the rise of overseas platforms such as AliExpress and Temu in South Korea, where their user bases now exceed some domestic Korean rivals 1.
- A recent KFTC survey found that some overseas platform operators lean on overseas staff and translation tools for consumer replies, while keeping limited staff and processes in Korea for dispute resolution 2.
- The move follows a May 2024 voluntary agreement in which some platforms agreed to tighten product-safety checks after Korean inspections found harmful substances in some items sold through their services 1.
- In November 2024, South Korea’s antitrust regulator ordered fixes for unfair terms at AliExpress and Temu. Both companies updated their terms after the order, including clauses that capped platform responsibility and required disputes to go only to foreign courts 3.
Korea’s approach fits a wider effort to close cross-border e-commerce gaps
- South Korea’s steps track a broader global shift as governments apply tougher oversight to platforms using a “China-to-door” cross-border model with limited local responsibility 4.
- Mandating a domestic agent raises local responsibility and can steer platforms toward more local operations, which may lift compliance costs compared with a low-overhead setup 4.
- The shift from voluntary product-safety commitments to proposed legal duties for domestic agents offers a possible model for applying domestic consumer-protection rules to overseas platforms 1.
- Higher compliance duties for overseas firms could narrow some rule gaps compared with domestic e-commerce companies that already follow Korean consumer-protection requirements.
Stay updated on the go with our mobile app.
Get latest insights with smoother, more personalized experience through TIA mobile app.