South Korea’s antitrust watchdog, the Fair Trade Commission, has ordered Google and Apple to revise unfair provisions, including the no-refund policy, in operating their mobile application stores, The Korea Times reports. ‘‘We expect the measure, aimed at protecting consumers, will have a ripple effect on similar cases throughout the world,” the Korea Fair Trade Commission (FTC) said. The Google Play webstore now has to develop a customer refund system based on web developers’ refund polices. Apple’s iTunes app store will have to send a notice to users when it modifies the terms in its contract.
“The FTC’s corrective orders will become benchmark cases for other countries, which face growing customer complaints over unfair provisions in contracts of mobile webstore operators,” said Hwang Won-chul, head of the KFTC’s Adhesion Contract Division. “While Google will limit its response to the FTC to the domestic market, Apple said it would consider applying the revised contract terms globally,” he added.
The FTC initiative follows repetead requests by the Citizens’ Coalition for Economic Justice, a nongovernmental organization, which back in 2013 urged the FTC to correct unfair sales practices of domestic and foreign mobile app stores. In response to the demand, the antitrust watchdog ordered domestic companies including KT, SK Planet, LG Electronics and LG Uplus to correct their unfair business terms in contracts for the webstores in March 2014.
The organization will report the repair clauses for Apple’s iPhone to the KFTC this week. “Currently, users are not able to get their original phones back from repair shops after they have their phones repaired. We will file a complaint against it (Apple) to see if that is also an unfair sales practice,” said Yoon Chul-hwan, an official at the Citizens’ Coalition for Economic Justice.
