S. Korea simplifies ID checks for private online resellers, mandates local reps for major foreign e-commerce firms

South Korea will narrow the personal information that online platforms must collect from individual sellers in consumer-to-consumer transactions, require large foreign e-commerce operators to designate local representatives, and impose surcharges of up to 100 percent on repeat violators.

The Korea Fair Trade Commission said Tuesday the Cabinet approved an amendment to the enforcement decree of the E-Commerce Act at a meeting held the same day.

The amendment first narrows the scope of seller identity information that platforms must verify in consumer-to-consumer transactions such as secondhand trading. Previously, individual sellers were subject to the same five-item requirement as businesses — name, date of birth, address, phone number and email address. Under the revised rules, only a phone number and email address will be required.

Where a seller's identity has already been verified through an accredited identity-verification agency, only a phone number will need to be confirmed, reducing the volume of personal data collected and lowering the risk of privacy breaches.

The amendment also tightens rules on foreign operators. Foreign e-commerce businesses with no domestic address or place of business must designate a local representative if they recorded sales of 1 trillion won ($664 million) or more in the previous year, averaged at least 1 million monthly domestic users during the three months preceding the end of the prior year, or received a request from the Fair Trade Commission for reports or data submissions due to actual or potential significant consumer harm resulting from a legal violation.

Once a representative is designated, the operator must submit the representative's name, address, phone number and email address to the Fair Trade Commission and display that information on the front page of its online storefront.

A new requirement will also oblige operators to publicly disclose their review management policies so consumers can assess product reviews more transparently. Businesses must post on the first screen where reviews appear the eligibility criteria for writing reviews, the duration reviews remain posted, the rating evaluation criteria, deletion standards and the procedure for filing objections.

A three-month grace period will be granted to give businesses time to prepare for the new review disclosure requirements.

Penalties for legal violations will also be strengthened. The surcharge multiplier for repeat offenses has been raised: a single repeat violation can now trigger a surcharge increase of up to 50 percent, and four or more repeat violations can result in an increase of up to 100 percent. At the same time, the discount for voluntary compliance has been reduced from a maximum of 30 percent to a maximum of 10 percent.

The amendment also streamlines the procedure for reporting the closure of a mail-order business. Operators who have lost or damaged their registration certificate will no longer need to submit a separate written explanation — they may simply note the reason on the closure report form.

Most of the changes will take effect Tuesday, alongside amendments to the enforcement rules and surcharge notice announced for public comment in March. The requirement for foreign operators to designate a local representative, however, will not take effect until Jan. 21 next year.

The Fair Trade Commission said it expects the overhaul to help protect consumer rights and deter legal violations in step with the evolving e-commerce landscape — including secondhand trading and cross-border direct purchases — thereby strengthening competitive order in the market.