FTC ups efforts to stamp out 'dark commercial patterns'

Industry

Published: 09 Aug. 2023, 11:33 Updated: 11 Aug. 2023, 18:38

FTC ups efforts to stamp out 'dark commercial patterns'

The Fair Trade Commission is stamping out advertisements with fake time limitations. [SHUTTERSTOCK]

Ever purchased a product under a “last day offer” only to find out the offer was still valid the next day?

Korea’s antitrust regulator is looking to stamp out such consumer-deceiving practices.

The Fair Trade Commission (FTC) has been sending examination reports to online lecture platforms for violating the Act on Fair Labeling and Advertising since late 2022, industry sources said Monday. These platforms include Conects, the operator of Gongdangi, and Eduwill.

Presenting an examination report to an entity under review for allegedly engaging in an antitrust activity is one of the steps in the FTC's regulatory process. The examined entity is given an opportunity to submit objections or comments on the report, which is followed by FTC deliberation, resolution and remedies.

This is the first time Korea’s antitrust regulator is rolling up its sleeves to hunt down these so-called “dark commercial patterns.”

An ad says a 30 percent discount offer expires in two hours and 30 minutes. Stirring a sense of urgency is one of the commonly used marketing techniques. [FAIR TRADE COMMISSION]

Ads under question included phrases such as “sold at this price today” or “sold in this bundle today only.” These phrases would not have violated the advertisement act if the special offer did end on the stated date but the sales promotion reportedly continued for days.

Some online platforms programmed their website to display consumers’ dates of access as the expiration date.

Cram school chains Megastudy and Sidae Injae are currently under government review for exaggeratedly publicizing students’ college entrance exam results and falsifying lecturers’ career histories, and could also receive examination reports for implementing deceptive patterns.

FTC’s probe over dark patterns in the online lecture market is in tandem with the government’s effort to eradicate private education “cartels” — a systematic practice in which private cram schools hire test organizers to come up with extremely difficult college entrance exam questions to charge exorbitant tuition fees.

″Dark commercial patterns″ currently under regulatory review by the National Policy Committee. [FAIR TRADE COMMISSION]

The FTC on July 31 released guidelines on 19 categories of dark patterns to fuel the National Assembly’s drive to ban such practices.

Rep. Song Seok-jun and 10 other lawmakers drafted an amendment to the Act on Consumer Protection in Electronic Commerce on April 20 to prohibit six dark commercial practices that are currently unregulated.

These include hidden subscriptions that automatically renew free trials to paid services and drip pricing that charges fees higher than the advertised price as customers go through the payment process.

The bill is currently under review by the National Policy Committee. If passed, it will be sent to the National Assembly’s plenary session for a final parliamentary review.