A Chinese online travel agency (OTA), Trip.com, has been issuing and selling prepaid gift cards to Korean consumers without registering with Korea's financial authorities, a claim raised in the National Assembly.
Kim Jae-seop of the People Power Party (National Policy Committee) said in a press release on the 23rd that Trip.com is selling gift cards by changing the country and language settings on its website and application (app) but has not registered as a prepaid issuer with the Financial Services Commission. Gift cards are a means of payment used for payment and refunds (reimbursements), the same as prepaid stored value.
Trip.com currently guides domestic users to change their country and language settings to purchase gift cards through the phrase "available for purchase after changing country." However, Kim argued that this effectively induces circumvention payments to evade domestic regulations. Although the company is effectively selling to domestic consumers, it is not subject to the authorities' oversight and regulation.
Under Article 28 of the Electronic Financial Transactions Act, businesses that issue and manage prepaid electronic payment instruments are required to register with the Financial Services Commission. Violations are punishable under Article 49 of the same law by up to three years in prison or a fine of up to 20 million won. In fact, in Mar., financial authorities detected and sanctioned the operation of Culture Gift Certificate Co., Ltd. while it was unregistered.
Kim said, "Trip.com has effectively sold gift cards to domestic consumers without registering with the financial authorities," adding, "It is a clear reverse discrimination to impose registration, guarantee, and reporting obligations on domestic corporations while leaving foreign companies as they are."
Moreover, core information such as the scale of Trip.com's gift card issuance and whether redemption is guaranteed is managed by its overseas headquarters, making confirmation in Korea impossible. This structure is highly likely to directly lead to consumer harm in the event of non-refundability or default.
Kim said, "Financial authorities should no longer leave foreign platforms in a blind spot," adding, "They must promptly determine whether Trip.com's gift cards fall under prepaid electronic payment instruments under the Electronic Financial Transactions Act and take immediate measures to apply the same regulations as those for domestic corporations."