South Korea to Strengthen Platform Accountability for Consumer Protection

South Korea’s Fair Trade Commission (FTC) is preparing to overhaul consumer protection regulations for large online platforms like Naver and Coupang, addressing concerns that current laws fail to adequately protect consumers in the evolving e-commerce landscape. The move comes as platforms increasingly blur the lines between brokerage and direct sales, prompting calls for greater responsibility when disputes arise.

Growing Concerns Over Platform Responsibility

The current Electronic Commerce Act largely allows online platforms to avoid liability for consumer damages, such as payment or refund issues, by claiming they are merely “mail order brokers” and not direct parties to the sale. However, platforms like Coupang and Naver are expanding their roles to include payment processing (Coupang Pay, Naver Financial), delivery services (Coupang Logistics Service), and direct sales of private brand products. This expansion has led to calls for a reassessment of their responsibilities.

Past Attempts at Reform and Consumer Sentiment

In 2021, the FTC attempted to revise the system, proposing that platforms mixing brokerage and direct purchases clearly differentiate products and share liability with sellers for consumer damages. However, this amendment faced strong opposition from the IT industry, labeled as “excessive regulation,” and ultimately failed to pass the National Assembly.

Recent consumer surveys indicate a growing expectation for platforms to seize greater responsibility. According to the Korea Consumer Agency’s 2025 Korea Consumer Life Index, 86.3% of consumers believe platforms should be held responsible in the event of a dispute, and 85.8% recognize them as actual contracting parties.

FTC’s New Research and Potential Changes

The FTC has initiated a six-month research service, running from April to October 2026, to examine the current state of the domestic mail order brokerage market and analyze international legislative trends, such as Europe’s Digital Services Act (DSA). The goal is to define new consumer protection obligations and clarify the scope of joint responsibility for platforms. An FTC official stated that the market demands strengthened responsibility given the expanded role of platforms and that the commission will function to prevent future consumer damage.

Coupang and US Trade Pressure

Recent developments also involve Coupang, which faced scrutiny over a 2025 data breach. Although the FTC initially signaled a potential business suspension, it has softened its stance, citing a lack of evidence of specific financial damage to users. This shift coincides with concerns over potential trade friction with the United States, as Coupang’s interim CEO, Harold Rogers, is scheduled to testify before the U.S. House Judiciary Committee on February 23, 2026, regarding his treatment during a Korean police probe. U.S. Lawmakers have criticized the investigation into Coupang as “discriminatory targeting.”

Other FTC Actions

The FTC has also initiated sanctions against Coupang, Market Kurly, and Naver for allegedly blocking consumers from canceling paid memberships mid-term and failing to refund unused portions of subscription fees. the FTC decided against imposing a business suspension on Coupang over the 2025 data breach, stating there was no evidence of financial harm to consumers.

The FTC also initiated a consent decision procedure against Coupang regarding allegations of lowering supply prices for subcontractors producing private brand goods and shifting promotional event costs to them.

Looking Ahead

The FTC’s ongoing research and potential legislative changes signal a growing commitment to strengthening consumer protection in the digital marketplace. The outcome of this process will likely have significant implications for the operational practices of major online platforms in South Korea and could set a precedent for other countries grappling with similar challenges.