The Fair Trade Commission imposed a penalty surcharge of about 2.1 billion won on two affiliates of the overseas direct shopping platform "AliExpress" for exaggerating discount rates and misleading consumers.
On the 31st, the Fair Trade Commission imposed correction orders and a penalty surcharge of 2.093 billion won on AliExpress affiliates Ocean Sky and MICTW for violating the law on the fairness of labeling and advertising.
According to the Fair Trade Commission, Ocean Sky and MICTW, which sell products to Korean consumers on AliExpress, falsely labeled prices that had never been sold in their cyber mall as the pre-discount price. For example, they listed a product that had never been sold for 100,000 won at that price and then claimed the final consumer price was 50,000 won after a 50% discount. The Fair Trade Commission determined that they engaged in false and exaggerated advertising by stating discounts based on the difference in actual selling prices.
The period of Ocean Sky's violation of the law on labeling and advertising is from June 3, 2023, to October 15 of last year, involving 2,422 related products. The period of MICTW's violation is from May 27, 2023, to October 15 of last year, involving 5,000 related products. The Fair Trade Commission imposed a penalty surcharge of 90 million won on Ocean Sky and 2.030 billion won on MICTW based on their related sales.
The Fair Trade Commission also imposed correction orders and fines of 2 million won on Alibaba Singapore, the operator of AliExpress, and Ali Korea for violating the Consumer Protection Act in Electronic Commerce.
Alibaba Singapore failed to display essential information such as its name, representative's name, address, phone number, and email address on its initial screen. According to the Electronic Commerce Act, businesses must register as a telemarketer to engage in telemarketing, but Alibaba Singapore did not fulfill this obligation. It also did not disclose on its initial screen that it was not a party to the telemarketing transaction and failed to provide consumer information from telemarketing clients until after the purchase.
Ali Korea also did not display necessary information on the initial screen of its cyber mall webpage and app. It similarly failed to provide the identity information of telemarketing clients to consumers until after the purchase. The Fair Trade Commission imposed fines of 1 million won each on both companies.
The Fair Trade Commission said, "We will enforce the law uniformly for domestic and international businesses regarding the business activities of global online platform operators in Korea" and added, "We will create a market environment where consumers can engage in transactions with confidence."