Lee, a 30-something office worker and a customer of Card Company A, had a baffling experience at year's end when trying to book a high-end Japanese restaurant with a card company voucher (voucher, monetary gift certificate). The restaurant said the reservation was unavailable because it was closed for remodeling on the desired date. Lee immediately complained to the card company, but the response was that "the terms and conditions state that 'due to partner circumstances, it may be difficult to use on the desired date.'"
The Fair Trade Commission said on the 17th that it reviewed 1,668 sets of terms and conditions of specialized credit finance companies (including credit card companies) that were enacted or revised last year and found 46 unfair clauses in the terms of such companies. It requested corrective action from the Financial Services Commission (FSC), the competent ministry. The Fair Trade Commission annually reviews financial transaction terms enacted or revised by financial institutions and requests corrections from the FSC, the competent ministry.
The Fair Trade Commission determined that, like Card Company A, having terms that restrict or suspend service use depending on the circumstances of partner companies and affiliated merchants violates the Terms and Conditions Act. Article 10 of the Act prohibits clauses that allow a business operator to unilaterally determine or change the content of performance without reasonable cause. In addition, Article 6 of the same Act prohibits clauses that are unfairly disadvantageous to customers.
The Fair Trade Commission also said it is a violation of the Terms and Conditions Act for a card company to specify reasons for service suspension in abstract terms. For example, Card Company B stated in its financial platform terms of use that "if a customer uses the service in an improper manner, the company may suspend service use." Article 9 of the Act prohibits "clauses that grant a business operator rescission or termination rights not provided by law and may disadvantage customers," and it viewed this as falling under that category.
The Fair Trade Commission requested the Financial Services Commission (FSC) to correct terms that allow a card company to conduct lawsuits with customers at a court with jurisdiction over the location of the card company's head office or place of business, saying such terms are problematic. Under Article 66 of the Financial Consumer Protection Act, the court with jurisdiction over lawsuits related to non-face-to-face financial product contracts is set as the consumer's address. Card Company B stated in its personal debit card member terms that "lawsuits related to the transaction under these terms shall be brought in the court with jurisdiction over the member's address or the location of the card company's head office or place of business."