As person-to-person secondhand transactions increase, disputes over product defects and refunds are also rising. But person-to-person transactions are hard to regulate under consumer protection rules like general online shopping, and observers have noted that even when problems arise, it is not easy to determine who is responsible. The government has moved to overhaul the system to reduce these blind spots.
According to the industry on the 28th, the Korea Internet & Security Agency (KISA) Electronic Transaction Dispute Mediation Committee is now operating a voluntary dispute mediation system linked with major secondhand transaction platforms. In disputes arising from person-to-person secondhand transactions, platforms first attempt mediation, and cases unresolved at the platform stage are handed over to the Electronic Transaction Dispute Mediation Committee. The Electronic Transaction Dispute Mediation Committee mediates disputes arising from transactions using electronic documents and can engage in disputes across all digital transaction processes, including person-to-person transactions.
Person-to-person secondhand transaction disputes have long been criticized for falling into a regulatory blind spot. The main reason is that the legal status of the transaction parties is the same, so consumer protection rules applied to transactions between businesses and consumers cannot be applied. As a result, even when damage occurs, it was difficult to obtain relief through the Korea Consumer Agency's damage relief or the Consumer Dispute Settlement Commission. Many disputes also relate to product defects, and in secondhand transaction processes it is hard to prove when an item was damaged, whether a defect existed before the transaction, or whether it arose during delivery.
Initially, KISA handled all disputes directly through the Electronic Transaction Dispute Mediation Committee, but the rapid, platform-centered market growth created an administrative burden. In response, KISA signed public-private cooperation agreements with major platforms such as Karrot, Bungaejangter, and Joonggonara, and established a two-track structure in which platforms attempt first-stage mediation and only cases where agreement fails are transferred to the committee.
When platforms take the lead in mediation, it also helps filter out repetitive disputes or malicious transactions. Public mediation bodies have limited means to compel participation if parties refuse, but platforms hold user information and transaction histories. In practice, platforms can impose strong internal sanctions, such as account suspensions, on users who repeatedly cause disputes or maliciously avoid mediation.
KISA and related ministries also revised standards for dispute resolution last year. Previously, the Ministry of Science and ICT's "person-to-person transaction dispute resolution standards" and the Korea Fair Trade Commission's "person-to-person secondhand transaction dispute resolution guidelines" operated separately, requiring coordination on which standards to apply to actual cases. The Ministry of Science and ICT's standards assumed sellers and buyers are equal individuals, while the Korea Fair Trade Commission (FTC) standards placed relatively more weight on buyer protection, given that sellers know more about the item.
The revised standards first assess the obligations each party must meet in the transaction process and the degree of defect. They examine whether the platform and seller properly disclosed the item's condition and transaction terms, whether the buyer checked items that should be verified before the transaction, and whether the defect significantly affects the product's use. They then calculate actual refund and compensation levels by reflecting factors such as the timing of defect discovery, usability, and refund scope across nine categories, including general goods and home appliances.
There are limits to the system. Mediation is difficult if a seller leaves the platform or cuts off contact. Even if KISA verifies personal information through the platform and attempts to make contact, it has limited means to compel participation if the other party refuses the mediation process. Cases suspected of fraud are referred to police, but it is hard to obtain substantive monetary adjustments.
Jang Seok-gwon, head of KISA's Digital Dispute Mediation Support Team, said, "The person-to-person transaction market has been an area with a lack of institutional discussion," adding, "Our goal is to develop statistics that can capture market conditions and to establish basic policies for consumer protection."