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CDSC found that “a purchaser has the right to cancel an order in case emoticons purchased online as a gift are not downloaded” 2019-07-19

CDSC found that “a purchaser has the right to cancel an order in case emoticons purchased online as a gift are not downloaded”

 

    With the growth in the number of people who use emoticons to represent emotions or feelings in text messaging from smartphones, or purchase or receive them as a gift, emoticon-related consumer disputes are also increasing.

 

    With regard to a case where a consumer claimed a refund for the emoticons which he/she purchased online and gave as a gift, the Consumer Dispute Settlement Commission (CDSC) (Chairperson Shin Jong-won) of the Korea Consumer Agency (KCA) made a resolution that the business operator who sold the emoticons should refund the purchase price because the consumer has the right to cancel his/her order* based on the Act on the Consumer Protection in Electronic Commerce, etc. (hereinafter referred to as “e-Commerce Transaction Act”) unless the person who receives the emoticons as a gift downloads them.

      * According to the e-Commerce Transaction Act, a consumer has the right to revoke a contract within 7 days from the date the consumer places an order.

 

Case Summary

 

 

 

    Consumer A (female, in her 30s) noticed that the purchased emoticons were not the ones she intended to buy shortly after purchasing the emoticons, and so requested a cancellation and refund for the purchased emoticons on the same day that she purchased them. However, the business operator who sold the emoticons argued that he could not provide a refund for the emoticons to her because her mother had the ownership of the emoticons and thus, she herself should request a cancellation and refund for the emoticons. In response, consumer A applied for mediation by the CDSC arguing that her mother herself could not request a refund because she was unfamiliar with mobile messenger apps.

 

    With regard to the case above, the business operator argued that it would be possible for the order to be cancelled only when consumer A’s mother requests a refund within 7 days from the date when she receives the purchased emoticons as a gift because a person who receives emoticons as a gift actually has the ownership of the emoticons, according to the terms and conditions of the business operator’s company.

 

    However, the CDSC found that consumer A, as a contract party, could exercise the right to cancel an order based on the e-Commerce Transaction Act, because the contract between consumer A and the business operator was equivalent to a contract for a third party* in the civil law, and consumer A’s mother, who was an actual user of the purchased emoticons, didn’t download them and express her willingness to receive the emoticons to the business operator.     

         * A contract for a third party is a contract that requires one of the parties to the contract (obligor) to fulfill his/her contractual obligations for a third party. And the third party in question may directly ask the obligor to perform the obligations. In this case, the right to receive a contract benefit arise when the third party expresses his/her willingness to receive the benefit to the obligor.

 

    The decision by the CDSC is of great significance in that it has not allowed the consumer’s right to cancel an order, albeit small sums of money, to be unfairly restricted, by taking into account the situation where new types and forms of electronic commerce transactions have been carried out*, with the rapid growth of the mobile market.    

       * In 2018, the value of online shopping transactions stood at about 111.89 trillion won, up 22.6% from the previous year, and of the online shopping transactions, mobile shopping accounted for about 68.67 trillion won, up 31.7% (Statistics Korea).

 

    The CDSC said, “Going forward, it will strive to protect consumers’ rights and interests and create a sound market environment by making fair and reasonable decisions about new and various forms of disputes resulting from a rapidly changing consumption environment.

 

According to Article 60 of the Framework Act on Consumers, the CDSC is set up and operated within the KCA to resolve disputes between consumers and business operators, and if the parties to a dispute accept the mediation outcome produced by the CDSC, and thus a settlement is reached through the mediation, the settlement is as equally binding as a judicial reconciliation.

 

 

 

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