"3-Hour Compensation Standard Is Unfair" Gyeongsilryeon Reports Telecom Companies' Damage Compensation Terms to Fair Trade Commission

[Asia Economy Reporter Eunmo Koo] The Citizens' Coalition for Economic Justice (CCEJ) has filed a request with the Fair Trade Commission for an unfair terms review regarding the liability clauses in the terms of service of the three major mobile carriers (SKT, KT, LGU+).

CCEJ pointed out that the liability clauses in the terms of service of the three telecom companies are unfair. On the 25th of last month, KT experienced a nationwide wired and wireless internet outage lasting 89 minutes. Although KT later announced its own compensation plan, the terms of service did not impose any liability for damages, making these clauses effectively unfair.

Currently, the terms of service for mobile communication, high-speed internet, and IPTV services of the three carriers, including KT, limit the scope of liability to cases where service is unavailable for “more than 3 consecutive hours or a cumulative 6 hours in a month.”

CCEJ stated, “Limiting the scope of liability to 3 or 6 hours through terms of service is a restriction without reasonable grounds under the Terms and Conditions Act, and it shifts the risk that the business should bear onto customers, constituting a ‘prohibition of exemption clauses’ and grounds for invalidity.” Regarding the ‘reasonable grounds’ in the terms, they criticized, “It is judged based on whether the terms appropriately reflect the circumstances of the time, such as the intent of the terms, the characteristics of the traded product, and the extent of customer damage, but the current terms were established based on standards from 20 years ago.”

They also pointed out the need to review ways to update the compensation amounts in the terms. Furthermore, “According to the same terms, the timing for compensation is set based on the moment the company ‘recognizes’ the damage caused by the service disruption, but this may overlook the ‘actual damage’ that occurred before recognition, so additional supplementation is necessary,” they added.

The KT network outage began around 11:16 a.m. on the 25th and lasted between 40 to 89 minutes. During a router replacement operation at the KT Busan office, an operator entered an incorrect configuration command, which caused routing errors and led to a nationwide internet network outage. Following an increase in DNS traffic, the network failure occurred, and KT completed recovery measures around 12:45 p.m.

Subsequently, on the 1st, KT announced a plan to compensate 10 times the service fee for the outage period regardless of the terms. Calculated as an average amount per person based on KT’s disclosed compensation, individual wireless subscribers on a 50,000 KRW plan would receive about 1,000 KRW, and small business owners up to approximately 8,000 KRW.

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