Tesla Compensation Expansion: "Including Company's Intentional and Negligent Acts"

Measures to Prevent Passing Delivery Delay Losses to Customers
Tesla's Delivery Obligation Exemption Rule Removed
Specific Regulations on Customer Order Cancellation Reasons
Fair Trade Commission: "Correcting World's No.1 Unfair Terms to Protect Customer Rights"

[Image source=Yonhap News]

[Asia Economy Reporter Moon Chaeseok] The Fair Trade Commission announced that it has expanded the scope of compensation by Tesla, which had only compensated 100,000 KRW for order fees. Tesla will be held responsible for consumer damages caused by Tesla's intentional or negligent actions.

On the 18th, the Fair Trade Commission stated that it had corrected five unfair terms and conditions implemented by Tesla. This came as the sales volume surged following the domestic launch of the affordable 'Model 3' last year. The number of newly registered Tesla vehicles increased from 283 units in 2017 to 7,078 units as of June.

Source=Korea Fair Trade Commission

First, Tesla's exemption from liability for damages and limitation of the scope of compensation were restricted. Tesla had exempted itself from all indirect and special damages as a business operator. The scope of compensation was limited to the order fee of 100,000 KRW.

The Fair Trade Commission viewed this practice as unfair because it contradicts the general principles that "compensation for damages should be within the scope of damages that can generally occur" and "a business operator is liable for compensation if they are aware of the occurrence of special damages."

Accordingly, a principle was established that Tesla will be held responsible if damages occur due to Tesla's intentional or negligent actions. Tesla's liability was changed to cover cases where Tesla was aware of the consumer's special damages.

Source=Korea Fair Trade Commission

The clause that shifted all damages occurring after the vehicle delivery period to the customer was also revised. Tesla's intentional or negligent actions will be held accountable by Tesla. The provision allowing Tesla to evade delivery obligations was also eliminated.

Tesla has voluntarily corrected and implemented the revised terms and conditions since the 14th. Additionally, Tesla plans to introduce contactless consignment delivery not only at the shipping location but also to locations desired by customers.

Lee Taehwi, head of the Fair Trade Commission's Terms and Conditions Review Division, expressed, "By making Tesla responsible for damages that may occur after the delivery period, it will contribute to enhancing customer rights."

Source=Korea Fair Trade Commission

Besides this, the Fair Trade Commission also ▲specifically defined the reasons for Tesla to cancel customer orders (such as sales for purposes other than final consumption), ▲allowed Tesla to transfer contracts to affiliates considering not only Tesla's discretion but also the Civil Act and Personal Information Protection Act, and ▲stipulated that not only the Seoul Central District Court but also other courts designated under the Civil Procedure Act can have jurisdiction over all disputes.

Lee said, "By correcting the unfair terms and conditions of Tesla, the world's number one electric vehicle company, not only has damage prevention been achieved, but customers' rights have also been institutionally guaranteed."

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