Rapid Growth of Live Commerce... Political Circles Move Toward Regulation

Consumer Protection System Inadequacies... Related Bills Proposed

Yang Jeong-suk, Independent lawmaker. [Image source=Yonhap News]

[Asia Economy Reporter Lim Chun-han] # Mr. A had a hard time after purchasing a product through live commerce. He washed the product because it was said to be washable with water, but it broke. When he contacted the seller, he was told that the product was not washable with water. When he mentioned live commerce, there was no broadcast record left, making it difficult to prove the damage.

◆ Political circles move to regulate live commerce = According to the industry on the 19th, political circles are actively moving to strengthen regulations on live commerce. This is because consumer damage caused by live commerce has emerged as a social issue. In particular, since there is no broadcast record left, it is often difficult to conduct a proper investigation even when consumer damage occurs.

Independent lawmaker Yang Jeong-suk proposed a bill last month that obligates telecommunication sales intermediaries to preserve telecommunication sales videos conducted via live commerce by recording or other methods, and to provide a way for the telecommunication sales consignor and consumers to view and preserve the videos.

According to the Korea Consumer Agency, in a survey conducted from November 19 to 24 last year targeting 500 consumers who had experience using live commerce in the past year, 81.6% of respondents answered that live commerce is similar to TV home shopping.

Live commerce has emerged as a new growth engine in the distribution industry. Unlike TV home shopping, it is popular among younger generations because sellers and consumers can communicate with each other through chat. Live commerce and TV home shopping both sell products via live broadcasts, but there is a significant difference in legal responsibility. TV home shopping uses public broadcasting media, so it is subject to pre-review, labeling and advertising regulations, and consumer protection obligations, whereas live commerce lacks related laws and systems. The Korea Consumer Agency pointed out that among 120 broadcasts from five live commerce platforms inspected from October 19 to 30 last year, 30 broadcasts contained content that could be considered unfair labeling and advertising.

◆ Fair Trade Commission and Korea Communications Commission strengthen e-commerce regulations = The government is promoting the amendment of the Act on Consumer Protection in Electronic Commerce and the Act on Fairness in Online Platform Intermediated Transactions to strengthen e-commerce regulations. Both bills aim to strengthen the responsibility of platform operators. Although not directly targeting live commerce, the intention is to hold platform companies accountable and strengthen self-regulation.

The distribution industry is closely watching the regulatory discussions in political circles. An industry official said, "Live commerce has become the trend after experiencing COVID-19," adding, "While some government guidelines are necessary, the growing market should not be destroyed like the case of the mobility platform ‘Tada’."

This content was produced with the assistance of AI translation services.