Four Idol Goods Sellers Banned from Refunds, Fair Trade Commission Imposes Sanctions

Four idol goods sellers who failed to fulfill consumer protection obligations, such as refusing refunds without videos of the product unboxing process or not providing information on the possible timing of product receipt, have been sanctioned by the Fair Trade Commission.

On the 11th, the Fair Trade Commission decided to impose corrective orders, warnings, and fines totaling 10.5 million KRW on four idol goods sellers?Weverse Company, YG Plus, SM Brand Marketing, and JYP 360?for violating the "Act on Consumer Protection in Electronic Commerce, etc." (Electronic Commerce Act).

The Electronic Commerce Act stipulates that consumers can withdraw their purchase within 7 days from the date of receiving goods or within 3 months (and within 30 days from the date the defect was discovered) if the product is defective.

However, the four sellers including Weverse Company arbitrarily shortened the withdrawal period and notified consumers accordingly, stated that exchanges or refunds are not possible if the packaging is damaged, required consumers to attach videos of the product unboxing process when requesting exchanges or refunds due to missing components in the received product, and imposed return restrictions on made-to-order products that are essentially simple pre-orders, thereby setting and notifying exception reasons for refusal of withdrawal arbitrarily.

The Fair Trade Commission judged these actions to constitute interference with consumers' right to withdraw from a contract (Article 21 of the Electronic Commerce Act).

Weverse Company also violated the obligation to provide information on transaction conditions under Article 13 of the Electronic Commerce Act by indicating the supply timing of some products, such as membership kits, as "scheduled for sequential delivery within the next quarter based on the purchase date."

The Fair Trade Commission stated, "This measure is significant in that it corrects illegal acts by the entertainment industry targeting teenagers, who are the main demand group for idol goods but have relatively low awareness of their rights under the Electronic Commerce Act."