Sanctions Imposed Even for Unintentional Violations, but "Dark Patterns Still Pervasive Online"

Guidance Period Ends
"Three-Month Business Suspension for Violations"

The guidance period for the new "dark pattern" regulations, which were added to the Electronic Commerce Act in February, ended on August 13. Ahead of the end of the guidance period, the Fair Trade Commission announced, "We will respond strictly not only to intentional violations, but also to cases where violations occur out of ignorance." There is speculation that the Fair Trade Commission may launch a full-scale investigation in the second half of this year, but companies still appear to be confused and unprepared.

A dark pattern refers to a design in which an online service provider subtly and covertly manipulates the user interface to hide necessary information or induce users to take unintended actions. The six types of dark patterns designated by the Fair Trade Commission as subject to regulation are: hidden renewal, sequential price disclosure, pre-selection of specific options, misleading hierarchy, obstruction of cancellation or withdrawal, and repeated interference.

Among these, "sequential price disclosure," newly established in Article 21-2 of the Electronic Commerce Act, refers to a method in which only part of the total price is displayed on the initial screen to attract consumers, and then additional costs are disclosed sequentially during the payment process, resulting in the final amount being charged. To prevent this, the Fair Trade Commission provided a six-month guidance period, giving companies time to modify their interfaces.

Despite the end of the guidance period, overall, companies' responses still appear insufficient. While most large corporations and OTT companies have rectified issues related to "hidden renewal," improvements regarding "sequential price disclosure" have been relatively slow. An attorney specializing in fair trade said, "For sequential price disclosure, the costs that must be disclosed vary depending on the nature of the goods, making uniform measures difficult," adding, "For these reasons, companies have yet to take active corrective actions." Lee Heejae (49, Judicial Research and Training Institute class 34), an attorney at HwaWoo, also stated, "In the case of sequential price disclosure, online intermediary businesses must design the UI/UX so that participating vendors can make improvements," emphasizing, "A comprehensive review of online interfaces across companies is necessary."

To prevent sequential price disclosure, the new provision requires e-commerce businesses or online sellers to display the "total amount" on the initial screen. The total amount must include value-added tax and other statutory charges, while costs such as shipping or installation fees, which can be selected by the consumer, may be excluded if there are legitimate reasons.

The main issue arises when taxes and similar charges are omitted from the initial screen. Lee Jeongran (44, class 37), an attorney at DaeryukAju, explained, "If only the amount excluding taxes is presented and the amount increases later by adding taxes, this may constitute 'sequential price disclosure.' However, if a lodging platform displays the price per night on the initial screen for a three-night booking, it cannot be considered price splitting simply because the total amount for three nights is not shown."

Violations of the dark pattern regulations can result in a three-month business suspension and fines even for a first offense, so thorough compliance checks are required.

Choi Yoomi (43, class 38), an attorney at Yulchon, said, "Dark patterns are still easily found online," and added, "Since the Fair Trade Commission has announced strict sanctions, including ex officio investigations, each company should re-examine its online interfaces."

However, the effectiveness of regulating overseas platforms is limited, raising concerns about "reverse discrimination" against domestic companies. This is because overseas platforms have servers, payment systems, customer support, and representatives located abroad, making it difficult for authorities to enforce regulations. There have also been cases where some overseas businesses have ignored official guidance notices from the authorities. To address this, a bill requiring the designation of a domestic representative under the Electronic Commerce Act has been proposed, but it is currently pending in the National Assembly.

Seo Hayeon, Legal Times Reporter

※This article is based on content supplied by Law Times.

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