FTC says electric scooter firms are responsible for accidents
Electric scooter-sharing companies will be held responsible for injuries or damages caused by their scooters, according to new rules laid out by the Fair Trade Commission (FTC).
The FTC on Tuesday ordered five electric scooter-sharing service operators to correct 12 terms and conditions that it deemed unfair. As well as requiring companies to take responsibility for injuries, it also ordered them to change rules that allowed firms to remove money or discount coupons from customers' accounts without prior warning.
The antitrust watchdog looked into the terms of five scooter-sharing service operators — Kickgoing operator Olulo, XingXing operator PUMP, Gogosing operator Mass-Asia, Gbike and Lime Korea — as reports of scooter-related accidents increase along with the rising popularity of personal mobility services.
Four of the operators have already voluntarily corrected the terms mentioned by the FTC. The fifth, Lime Korea, will update its terms by Dec. 4.
Companies will now be responsible for accidents that are the fault of the company, such as technical defects.
Previously, the terms and conditions used by ride-sharing services meant that they were not responsible for any physical or property damage occurred by users. Some limited the maximum compensation to 100,000 won ($90) or only provided compensation if an accident was due to gross negligence and an operator deemed that they were at fault.
“There’s an inherent risk of accidents in scooter-sharing services, and companies are liable to strict supervisory responsibilities; therefore, it’s unfair to discount their responsibility for small accidents,” read the statement from the FTC.
Accidents caused by electric scooters have been rapidly increasing every year, according to Korea Consumer Agency data. Numbers especially jumped the most this year due to the pandemic, by 88 percent, from 257 accidents in 2019 to 483 as of October this year.
Four operators have also corrected unfair terms in their refund policies.
Olulo, Mass-Asia and Lime were ordered to correct their refund policies so that customers can receive refunds of unused money they have charged to their accounts. Before the correction, the three operators did not offer refunds.
Policies related to coupons and discount events were also subject to change.
Olulo, PUMP and Mass-Asia will now inform users when the company plans to make changes to customer’s use of discount coupons distributed by the company. Before, the three operators could cancel or take back discount offers and even stop certain customers from using their service without prior notice.
“The FTC hopes such corrections will protect customer rights and become an opportunity for the industry to grow in a healthy direction,” said the FTC.
“We will continue to check for unfair terms in [products and services from] various sharing and subscription businesses and work to enhance customer’s rights in the respective fields.”
BY KANG JAE-EUN [firstname.lastname@example.org]
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