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ENFORCEMENT DECREE OF THE ACT ON DOOR-TO-DOOR SALES, ETC.

Wholly Amended by Presidential Decree No. 17685, Jul. 24, 2002

Amended by Presidential Decree No. 18312, Mar. 17, 2004

Presidential Decree No. 19507, jun. 12, 2006

Presidential Decree No. 19629, Jul. 27, 2006

Presidential Decree No. 19958, Mar. 27, 2007

Presidential Decree No. 20177, Jul. 18, 2007

Presidential Decree No. 20341, Oct. 23, 2007

Presidential Decree No. 20351, Oct. 31, 2007

Presidential Decree No. 20587, Jan. 31, 2008

Presidential Decree No. 21214, Dec. 31, 2008

Presidential Decree No. 21765, Oct. 1, 2009

Presidential Decree No. 22151, May 4, 2010

Presidential Decree No. 22424, Oct. 1, 2010

Presidential Decree No. 22467, Nov. 2, 2010

Presidential Decree No. 22493, Nov. 15, 2010

Presidential Decree No. 24076, Aug. 31, 2012

Presidential Decree No. 24436, Mar. 23, 2013

Presidential Decree No. 25527, Jul. 28, 2014

Presidential Decree No. 25840, Dec. 9, 2014

Presidential Decree No. 26035, Jan. 6, 2015

Presidential Decree No. 26758, Dec. 22, 2015

Presidential Decree No. 27606, Nov. 22, 2016

Presidential Decree No. 27751, Dec. 30, 2016

Presidential Decree No. 27988, Apr. 11, 2017

Presidential Decree No. 28702, Mar. 13, 2018

CHAPTER I GENERAL PROVISIONS
 Article 1 (Purpose)
The purpose of this Decree is to provide for matters delegated by the Act on Door-to-Door Sales, Etc. and matters necessary for the enforcement thereof.
 Article 2 (Scope of Multi-Level Marketing Organizations)
(1) "Cases specified by Presidential Decree" in the proviso to subparagraph 5 (b) of Article 2 of the Act on Door-to-Door Sales, Etc. (hereinafter referred to as the "Act") means any of the following cases:
1. Where a method for paying bonuses to salespersons is the same as, or similar to, the method for paying bonuses where salespersons are classified as three or more levels;
2. Where a person (excluding a person registered as a multi-level marketing entity or door-to-door sales entity under sponsorship in accordance with Article 13 or 29 (3) of the Act) entrusted by another person, with sales or the management of an organization recruits, manages, and operates his/her subordinate salespersons and it is a sales organization with three or more levels or it is managed and operated in a similar manner, when the subordinate sales organizations of the entrusting person and the entrusted person are presumed to be a single sales organization.
(2) The method for paying bonuses to salespersons under paragraph (1) 1 and guidelines for the management and operation of an organization with three or more levels as defined in paragraph (1) 2 or a similar organization shall be prescribed by Ordinance of the Prime Minister.
 Article 3 (Payment of Bonuses for Door-to-Door Sales Under Sponsorship)
In paying bonuses in accordance with the former part of subparagraph 7 of Article 2 of the Act, a particular salesperson's outcomes of purchase or sales and activities for education, training, and organizational management that directly affect such outcomes shall affect bonuses only for one single salesperson at the immediately higher level: Provided, That the payment of allowances for any of the following costs and expenses shall not be included in the bonuses paid in accordance with the former part of subparagraph 7 of Article 2 of the Act:
1. Education and training fees paid on an irregular basis in accordance with the guidelines established in advance, such as hourly-rate education fees, regardless of outcomes of purchase or sales;
2. Bonuses paid equally to all salespersons or products for trial;
3. Subsidies paid for the operation of a business establishment according to expenses actually incurred.
 Article 4 (Scope of Consumers)
"A person specified by Presidential Decree" in subparagraph 12 of Article 2 of the Act means any of the following persons, who uses goods or services provided by business entities (hereinafter referred to as "goods, etc.") for any purpose other than for daily life as a consumer: <Amended by Act No. 24436, March 23, 2013>
1. An end-user of goods or services: Provided, That persons who use goods, etc. as raw materials (including intermediary goods) or capital goods shall be excluded herefrom;
2. A business entity who falls under the proviso to subparagraph 1 of Article 3 of the Act and who buys goods, etc. (limited to the relationship to a person who sells relevant goods, etc.);
3. A person who buys goods, etc. for the first time from a multi-level marketing entity or door-to-door sales entity under sponsorship in order to become a multi-level marketing salesperson or door-to-door salesperson under sponsorship;
4. A door-to-door salesperson or telemarketing salesperson (hereinafter referred to as a “salesperson engaging in door-to-door sales or telemarketing") who deals with a door-to-door sales entity or a telemarketing entity (hereinafter referred to as a "door-to-door sales entity, etc.");
5. A person who buys goods, etc. for activities for agriculture (including the livestock industry) or fisheries (excluding a person engaging in ocean fisheries with permission from the Minister of Oceans and Fisheries in accordance with Article 6 (1) of the Distant Water Fisheries Development Act).
 Article 5 (Scope of Persons Specially Related, etc.)
(1) "Persons specially related to him/her as defined by Presidential Decree" in subparagraph 13 (a) of Article 2 of the Act means persons who fall under any of the following subparagraphs:
1. A person who falls under any of the following items, if the controlling shareholder is an individual:
(a) Spouse;
(b) A relative by blood in the sixth or closer degree or a relative by marriage in the fourth or closer degree;
(c) A corporation, at least 30/100 of the capital of which has been invested solely by its controlling shareholder or jointly with persons in a relationship specified in item (a) or (b) with the controlling shareholder, or any of its executives;
(d) A corporation, at least 30/100 of the capital of which has been invested solely by its controlling shareholder or jointly with persons in a relationship specified in any provision of items (a) through (c) with the controlling shareholder, or any of its executives;
2. A person who falls under any of the following items, if the controlling shareholder is a corporation:
(a) An executive;
(b) An affiliated company (referring to an affiliated company as defined in subparagraph 3 of Article 2 of the Monopoly Regulation and Fair Trade Act) or any of its executives.
(2) "A person who has de facto control over the management of the corporation" in the former part of subparagraph 13 (b) of Article 2 of the Act means a person who falls under any of the following subparagraph:
1. A person who has appointed or dismissed the representative or who has appointed or has the power to appoint not less than 50/100 of executives solely or under an agreement or arrangement with other shareholders or investors;
2. A person who exercises dominant influence over decision-making in major matters or executing affairs, including a organizational change in and investment in a new project by the relevant corporation.
 Article 6 (Transactions Excluded from Application of the Act)
"A transaction specified by Presidential Decree" in subparagraph 3 of Article 3 of the Act means a transaction through which a door-to-door sales entity who does not have door-to-door salespersons sells any of the following goods or services by door-to-door sales:
1. An unprocessed product from agriculture, fisheries, livestock industry, or forestry;
2. Goods or services produced directly by a door-to-door seller.
CHAPTER II DOOR-TO-DOOR SALES AND TELEMARKETING
 Article 7 (Matters subject to Reporting by Door-to-Door Sales Entities, etc.)
"Matters specified by Presidential Decree" in the main sentence, other than subparagraphs of Article 5 (1) of the Act means assets, liabilities, and capital of a door-to-door sales entity, etc., which is a company as defined in the Commercial Act.
 Article 8 (Procedure, etc. for Reporting by Door-to-Door Sales Entities, etc.)
(1) When a door-to-door sales entity, etc. intends to file a report in accordance with the main sentence of Article 5 (1) of the Act, he/she shall file the report in the form specified by Ordinance of the Prime Minister with the Special Self-Governing City Mayor, the Governor of the Special Self-Governing Province, or the head of a Si/Gun/Gu (the head of a Gu means the head of an autonomous Gu; hereinafter the same shall apply) having jurisdiction over his/her principal place of business, along with a document certifying his/her assets, liabilities, and capital (applicable only to a company under the Commercial Act; including an electronic document): Provided, That if his/her principal place of business is in a foreign country, such report shall be filed with the Fair Trade Commission.
(2) Upon receipt of a report in accordance with paragraph (1), the Fair Trade Commission or the competent Special Self-Governing City Mayor or Special Self-Governing Province Governor or the head of the competent Si/Gun/Gu shall verify the following documents through administrative information sharing in accordance with Article 36 (1) of the Electronic Government Act: Provided, That if the person filing such report does not consent to verification of the document specified in the proviso to subparagraph 1 or subparagraph 2 or it is impossible to verify such document, the competent authority shall require the person to submit the relevant document (referring to a transcript in cases of subparagraph 2): <Amended by Presidential Decree No. 27988, Apr. 11, 2017>
1. A certified transcript of corporate register (applicable only to a corporation): Provided, That an abridged copy of the resident registration card of each promotor shall be submitted instead, if such report is filed before the registration for incorporation of the relevant corporation is completed;
2. A certificate of business registration.
(3) Upon receipt of a report in accordance with paragraph (1), the Fair Trade Commission or the competent Special Self-Governing City Mayor or Special Self-Governing Province Governor or the head of the competent Si/Gun/Gu shall issue a certificate of reporting in the form specified by Ordinance of the Prime Minister.
(4) A person who intends to report a change in accordance with Article 5 (2) of the Act shall file a report in the form specified by Ordinance of the Prime Minister, along with documents certifying the change, within 15 days from the date on which the change occurs (or the date on which accounts are finally settled, if there exist changes in assets, liabilities, or capital) with the Fair Trade Commission or the competent Special Self-Governing City Mayor or Special Self-Governing Province Governor or the head of the competent Si/Gun/Gu. In such cases, the Fair Trade Commission or the competent Special Self-Governing City Mayor or Special Self-Governing Province Governor or the head of the competent Si/Gun/Gu shall verify such change and re-issue a certificate of reporting with descriptions of the change thereon.
(5) If a door-to-door sales entity, etc. intends to temporarily or permanently close down his/her business or resume his/her business after temporary closure in accordance with Article 5 (3) of the Act, it shall file a report in the form specified by Ordinance of the Prime Minister with the competent Special Self-Governing City Mayor or Special Self-Governing Province Governor or the head of the competentSi/Gun/Gu. When a report on permanent closure is filed in such cases, such report shall be accompanied by the certificate of reporting.
(6) When a person intends to file a report required by any provision of paragraphs (1) through (5) by electronic documents as defined in subparagraph 1 of Article 2 of the Framework Act on Electronic Documents and Transactions (hereinafter referred to as "electronic documents"), he/she may file the report using the information processing system specified by the Fair Trade Commission. <Amended by Presidential Decree No. 24076, Aug. 31, 2012>
(7) If it is impractical to submit some data by electronic documents when a report is filed by electronic documents in accordance with paragraph (6), such data may be supplemented by mail or other similar means within one month, and a report supplemented in such manner shall be deemed to have been filed on the date it was filed by electronic documents.
(8) Except for matters provided for in paragraphs (1) through (7), matters necessary for the receipt and acceptance of reports by electronic documents shall be prescribed by Ordinance of the Prime Minister.
 Article 9 (Door-to-Door Sales Entities, etc. Exempt from Duty to Report)
"A door-to-door sales entity, etc. specified by Presidential Decree" in Article 5 (1) 1 of the Act means any of the following door-to-door sales entities, etc.:
1. Door-to-door sales entities without employing door-to-door salespersons;
2. Telemarketing sales entities without employing telemarketing salespersons.
 Article 10 (Disclosure of Information about Door-to-Door Sales Entities, etc.)
When the Fair Trade Commission intends to disclose information about a door-to-door sales entity, etc. in accordance with Article 5 (4) of the Act, it shall notify the relevant door-to-door sales entity, etc. of the details of information to be disclosed and the method of disclosure and shall provide the business entity, etc. an opportunity to correct any error in the details to be disclosed.
 Article 11 (Matters Included in Contract)
"Matters specified by Presidential Decree" in Article 7 (1) 11 of the Act means the following matters:
1. Details of charges, if any, the consumer shall pay in addition to the price for goods or services, and the amount of such charges;
2. Details of restrictions on the date and timing of sale, the place for sale, the quantity sold, the place for delivery, and other terms and conditions of sale, if such restrictions exist.
 Article 12 (Restriction on Withdrawal of Subscription, etc.)
"Cases specified by Presidential Decree" in Article 8 (2) 5 of the Act means cases where goods or services are to be produced specially in accordance with a consumer's order; the relevant door-to-door seller or telemarketer (hereinafter referred to as "door-to-door seller or telemarketer") is likely to sustain a severe and irrecoverable loss if the consumer is allowed to withdraw subscription or cancel the relevant contract (hereinafter referred to as "withdrawal of subscription, etc."); and thus the door-to-door seller or telemarketer notifies the consumer of such fact separately with regard to the relevant transaction and obtains written consent thereto from the consumer (including an electronic document).
 Article 13 (Interest Rate of Late Payment Penalty)
"The interest rate prescribed by Presidential Decree" in the latter part of Article 9 (2) of the Act means 15/100 per annum. <Amended by Presidential Decree No. 27606, Nov. 22, 2016>
 Article 14 (Means of Payment subject to Suspension or Cancellation of Billing for Proceeds Following Withdrawal of Subscription, etc.)
"Means of payment specified by Presidential Decree" in the main sentence of Article 9 (3) of the Act means any means of payment, other than cash, that a consumer who buys goods or services pays directly (including payment by bank account transfer) with the same effect as refunding proceeds to the consumer where the business entity who provides such means of payment (hereinafter referred to as "settlement agency") is requested to suspend or cancel billing for the proceeds or when the relevant door-to-door seller or telemarketer refunds proceeds to the settlement agency.
 Article 15 (Offset against Debts)
(1) A settlement agency may offset proceeds in accordance with the latter part of Article 9 (6) of the Act immediately when a consumer requests it to offset proceeds in accordance with the following subparagraphs:
1. Proceeds shall be offset in accordance with a document stating the refundable amount, etc. (including an electronic document);
2. A document certifying that withdrawal of subscription, etc. was made within the period specified in subparagraphs of Article 8 (1) of the Act or paragraph (3) of the aforesaid Article and that goods or services have been returned in accordance with Article 9 (1) of the Act (or a certificate, if the consumer attempted to return goods or services to the address of the door-to-door seller or telemarketer stated in the contract, but the door-to-door seller or telemarketer refused to accept the returned goods or services) shall be attached thereto.
(2) When a settlement agency offsets proceeds in accordance with paragraph (1), it shall dispatch a document stating the fact and the amount of offset (including an electronic document) to the door-to-door seller or telemarketer and the consumer without delay.
(3) Except for matters provided for in paragraphs (1) and (2), matters necessary for a settlement agency's offset shall be prescribed by Ordinance of the Prime Minister.
 Article 16 (Scope of Claimable Cost of Goods or Services Partially Consumed)
(1) "The costs and expenses within the limit prescribed by Presidential Decree" in Article 9 (8) of the Act means the following costs and expenses:
1. Where the use of goods or services makes it impracticable to re-sell consumable parts or significantly diminishes the resale price: The costs and expenses incurred in provision of such consumable parts;
2. Where goods or services are composed of many identical divisible components: The costs and expenses incurred in provision of consumed parts due to the consumer's partial consumption.
(2) If the Fair Trade Commission deems it necessary, it may establish and publicly announce detailed guidelines for the costs and expenses specified in subparagraphs of paragraph (1), taking into consideration the kind of goods or services, the trading price, commercial practice, etc.
 Article 17 (Level of Obligations Imposed on Salespersons Engaging in Door-to-Door Sales or Telemarketing)
"The level specified by Presidential Decree" in Article 11 (1) 3 of the Act means 20,000 won per annum per person who is, or intends to become, a salesperson engaging in door-to-door sales or telemarketing.
 Article 18 (Use of Consumer Information for Delivery of Goods or Services)
"Cases specified by Presidential Decree" in Article 11 (1) 9 (a) of the Act means the following cases:
1. Where information about a consumer is provided to a person to whom the delivery or conveyance of goods or services is entrusted, among persons engaging in the business of delivering or conveying goods or services;
2. Where information about a consumer is provided to a person to whom the provision of relevant services is entrusted, among persons engaging in the business of installing goods or services or providing after-sale services or other services as agreed.
 Article 19 (Use of Consumer Information Necessary for Verification of Identity for Prevention of Misappropriation)
"Cases specified by Presidential Decree" in Article 11 (1) 9 (c) of the Act means the following cases:
1. Where information about a consumer is provided to a person who falls under any of the following items in order to verify the identity or real name of the consumer or the consumer's actual intention:
(a) A key telecommunications business entity as defined in Article 5 (3) 1 of the Telecommunications Business Act;
(b) A credit information company as defined in subparagraph 5 of Article 2 of the Credit Information Use and Protection Act;
(c) A settlement agency directly related to the payment of proceeds for the relevant transaction;
(d) A person engaging in business of verifying real names for preventing misappropriation in accordance with any relevant Act and subordinate statutes or with authorization or permission under any relevant Act and subordinate statutes;
2. Where such information is used to verify whether a minor's legal guardian consents to a transaction by the minor.
CHAPTER III MULTI-LEVEL MARKETING AND DOOR-TO-DOOR SALES UNDER SPONSORSHIP
 Article 20 (Procedure, etc. for Registration of Multi-Level Marketing Entities, or Door-to-Door Sales Entities Under Sponsorship)
(1) A person who intends to register itself as a multi-level marketing entity or door-to-door sales entity under sponsorship in accordance with Article 13 (1) or 29 (3) of the Act shall file an application in the form specified by Ordinance of the Prime Minister with the Special Metropolitan City Mayor, Metropolitan City Mayor, Special Self-Governing City Mayor, Do Governor or Special Self-Governing Province Governor having jurisdiction over his/her principal place of business (hereinafter referred to as "competent Mayor/Do Governor"): Provided, That if his/her principal place of business is in a foreign country, such application shall be filed with the Fair Trade Commission.
(2) Upon receipt of an application for registration under paragraph (1), the Fair Trade Commission or the competent Mayor/Do Governor shall issue a certificate of registration in the form specified by Ordinance of the Prime Minister, if the application meets the requirements for registration.
(3) A person who intends to report a change in accordance with Article 13 (2) or 29 (3) of the Act shall file a report in the form specified by Ordinance of the Prime Minister, along with documents certifying the change, with the Fair Trade Commission or the competent Mayor/Do Governor within 15 days from the date on which the change occurs (or the date on which accounts are finalized, if a change occurs in the amount of capital as referred to in Article 21), and upon receipt of such report, the Fair Trade Commission or the competent Mayor/Do Governor shall verify the change and re-issue a certificate of registration stating the change: Provided, That if a change occurs in a consequence of termination or expiration of a contract for indemnity insurance against consumer loss, etc. required by Article 13 (1) 3 of the Act, documents certifying such change shall be submitted to the Fair Trade Commission or the competent Mayor/Do Governor by not later than three months before the date of termination or expiration of the contract.
(4) If a business entity engaging in multi-level marketing or door-to-door sales under sponsorship intends to temporarily or permanently close down his/her business or resume his/her business after temporary closure in accordance with Article 13 (3) or 29 (3) of the Act, he/she shall file a report in the form specified by Ordinance of the Prime Minister with the Fair Trade Commission or the competent Mayor/Do Governor. When a report on permanent closure is so filed, such report shall be accompanied by the certificate of reporting.
(5) When a person intends to file a report required by paragraphs (3) and (4) by electronic documents, he/she may file the report using the information processing system specified by the Fair Trade Commission.
(6) Article 8 (7) and (8) shall apply mutatis mutandis to reporting by a business entity engaging in multi-level marketing or door-to-door sales under sponsorship in accordance with any provision of paragraphs (3) through (5).
 Article 21 (Amount of Capital of Multi-Level Marketing Entities)
"The amount prescribed by Presidential Decree" in Article 13 (1) 2 of the Act means 500 million won (excluding the amount of capital impaired, if capital has been impaired, but including the amount of a legal reserve, if the legal reserve has been set aside).
 Article 22 (Disclosure of Information about Multi-Level Marketing Entities or Door-to-Door Sales Entities Under Sponsorship)
(1) Information about the following matters may be disclosed in accordance with Articles 13 (4) and 29 (3) of the Act:
1. The registration number and the date of registration;
2. The name (the representative's name, if the business entity is a corporation), trade name, address, and telephone number of the multi-level marketing entity or door-to-door sales entity under sponsorship;
3. Goods or services to be sold and the sales volume thereof;
4. Guidelines for the calculation and payment of bonuses;
5. Other matters specified by the Fair Trade Commission as necessary for consumer protection and maintenance of order in trading.
(2) When the Fair Trade Commission intends to disclose information in accordance with Article 13 (4) or 29 (3) of the Act, it shall notify the relevant business entity of the details of information to be disclosed and the method of disclosure and shall provide the business entity an opportunity to correct any incorrect details to be disclosed.
 Article 23 Deleted. <by Presidential Decree No. 27606, Nov. 22, 2016>
 Article 24 (Grounds for Withdrawal of Subscription, etc. against Multi-Level Marketing Salespersons and Door-to-Door Salespersons Under Sponsorship)
"A cause specified by Presidential Decree" in the proviso to Article 17 (1) of the Act (including where the aforesaid provisions shall apply mutatis mutandis pursuant to Article 29 (3) of the Act) means the following grounds:
1. Where it is impossible for a consumer to withdraw subscription or cancel a contract because the multi-level marketing salesperson or door-to-door salesperson under sponsorship has changed his/her address, telephone number, e-mail address, or other contact information or his/her whereabouts are unknown;
2. Where it is hardly expected to have proceeds refunded even if a consumer withdraws subscription or cancels a contract against the relevant multi-level marketing salesperson or door-to-door salesperson under sponsorship.
 Article 25 (When Multi-Level Marketing Salespersons and Door-to-Door Salespersons Under Sponsorship are not Allowed to Withdraw Subscription, etc.)
"Cases specified by Presidential Decree" in Article 17 (2) 3 of the Act (including where the aforesaid provisions shall apply mutatis mutandis pursuant to Article 29 (3) of the Act) means cases that fall under any of the following subparagraphs:
1. Where goods or services have been destroyed or damaged due to a cause for which the relevant multi-level marketing salesperson or door-to-door salesperson under sponsorship is responsible: Provided, That where the outer packaging is destroyed in order to verify components of goods or services shall be excluded herefrom;
2. Where the partial use or consumption of goods or services has significantly diminished the value of goods or services: Provided, That the foregoing shall apply only where measures have been taken to avoid any interference with the exercise of the right to withdraw subscription, etc. due to partial use of goods or services by clearly indicating the impossibility of withdrawing subscription, etc. on the outer packaging or any readily noticeable part of goods or services or by providing samples;
3. Where the outer packaging of replicable goods or services, has been damaged;
4. Where goods or services are to be produced specially according to the order of a consumer, multi-level marketing salesperson, or door-to-door salesperson under sponsorship; the business entity engaging in multi-level marketing or door-to-door sales under sponsorship is likely to sustain a severe and irrecoverable loss if the consumer, multi-level marketing salesperson, or door-to-door salesperson under sponsorship is allowed to withdraw subscription or cancel the relevant contract and thus the business entity notifies the consumer, multi-level marketing salesperson, or door-to-door salesperson under sponsorship of the fact separately with regard to the relevant transaction and obtains written consent thereto from him/her (including an electronic document).
 Article 26 (Deduction of Expenses from Refundable Proceeds for Goods or Services)
Cases where a business entity engaging in multi-level marketing or door-to-door sales under sponsorship may deduct expenses from proceeds for goods or services in accordance with the proviso to Article 18 (2) or 29 (3) of the Act shall be limited to cases where the relevant multi-level marketing salesperson or door-to-door salesperson under sponsorship returns supplied goods or services not earlier than one month from the date goods or services are provided, but such deductible expenses shall be subject to the following limitations: Provided, That if goods or services are returned because the registration of a business entity engaging in multi-level marketing or door-to-door sales under sponsorship is revoked, such deductible expenses shall not exceed one-half of the amount specified in any of the following subparagraphs:
1. Where goods or services are returned not earlier than one month, but not later than two months from the date of provision: The amount agreed on by and between parties, which shall not exceed five percent of proceeds for goods or services;
2. Where goods or services are returned not earlier than two months, but not later than three months from the date of provision: The amount agreed on by and between parties, which shall not exceed seven percent of proceeds for goods or services.
 Article 27 (Offset against Debts)
(1) When the opposite party to a transaction of multi-level marketing or door-to-door sales under sponsorship requests the relevant settlement agency to offset proceeds in accordance with the following subparagraphs, the settlement agency may offset proceeds immediately in accordance with Article 18 (4) or 29 (3) of the Act:
1. Proceeds shall be offset in accordance with a document stating the refundable amount (including an electronic document);
2. A document certifying that withdrawal of subscription, etc. was made within the period specified in Article 17 (1) or (2) of the Act (including where the aforesaid provisions shall apply mutatis mutandis pursuant to Article 29 (3) of the Act) and that goods or services have been returned in accordance with Article 18 (1) or 29 (3) of the Act (or a certificate, if the opposite party attempted to return goods or services to the address of the business entity engaging in multi-level marketing or door-to-door sales under sponsorship or the multi-level marketing salesperson or door-to-door salesperson under sponsorship stated in the contract, but the business entity or salesperson refused to accept the returned goods or services) shall be attached thereto.
(2) When a settlement agency offsets proceeds in accordance with paragraph (1), it shall dispatch a document stating the fact and the amount of offset (including an electronic document) to the relevant business entity engaging in multi-level marketing or door-to-door sales under sponsorship or the multi-level marketing salesperson or door-to-door salesperson under sponsorship and the opposite party without delay.
(3) Except for matters provided for in paragraphs (1) and (2), matters necessary for a settlement agency's offset shall be prescribed by Ordinance of the Prime Minister.
 Article 28 (Amendment of Guidelines for Calculation and Payment of Bonuses)
(1) When it is intended to amend guidelines for the calculation and payment of bonuses in accordance with Article 20 (2) or 29 (3) of the Act, each multi-level marketing salesperson or door-to-door salesperson under sponsorship shall be notified (including notice by e-mail or mobile phone text messages) of the amended guidelines, grounds for amendment, and the date when amended guidelines are applied, along with current guidelines for the calculation and payment of bonuses, by no later than three month prior to the date when amended guidelines are applied: Provided, That the guidelines for the calculation and payment of bonuses may be amended immediately if the amendment is beneficial to all multi-level marketing salespersons or door-to-door salespersons under sponsorship or if all multi-level marketing salespersons or door-to-door salespersons under sponsorship consent thereto. <Amended by Act No. 26035, Jan. 6, 2015>
(2) Notice under paragraph (1) by using e-mail or mobile phone text messages shall be limited to multi-level marketing salespersons or door-to-door salespersons under sponsorship who have given express consent to notification by e-mail or mobile phone text messages in advance. <Amended by Act No. 26035, Jan. 6, 2015>
(3) If it is impossible to give notice under paragraph (1) individually to a multi-level marketing salesperson or door-to-door salesperson under sponsorship because his/her address is unknown or due to any similar cause, such notice under paragraph (1) may be substituted by publishing the notice under paragraph (1) through the in-house newsletter or by posting such notice on the homepage for not less than one month.
 Article 29 (Limit on Burden Imposed on Multi-Level Marketing Salespersons or Door-to-Door Salespersons Under Sponsorship)
"The level specified by Presidential Decree" in Article 22 (1) of the Act (including where the aforesaid provisions shall apply mutatis mutandis pursuant to Article 29 (3) of the Act) means 50,000 won per year. In such cases, applying different guidelines for the payment of bonuses according to the outcomes of sales and purchase by a person who is, or intends to become, a multi-level marketing salesperson or door-to-door salesperson under sponsorship or his/her subordinate salespersons shall not be deemed a burden imposed to compel them to purchase goods or services.
 Article 30 (Limitation on Price for Commodities for Sale)
"The amount specified by Presidential Decree" in Article 23 (1) 9 of the Act (including where the aforesaid provisions shall apply mutatis mutandis pursuant to Article 29 (3) of the Act) means 1.6 million won (inclusive of the value-added tax).
 Article 31 (Use of Consumer Information for Delivery of Goods or Services)
"Cases specified by Presidential Decree" in Article 23 (1) 10 (a) of the Act (including where the aforesaid provisions shall apply mutatis mutandis pursuant to Article 29 (3) of the Act) means the following cases:
1. Where information about a consumer is provided to a person to whom delivery or conveyance of goods or services is entrusted, among persons engaging in business of delivering or conveying goods or services;
2. Where information about a consumer is provided to a person to whom provision of services is entrusted, among persons engaging in installing goods or providing after-sales services or other agreed services;
3. Where information about a consumer is provided to a person who is liable to pay damages to a consumer in accordance with a contract for indemnity insurance against consumer loss or a similar contract executed pursuant to Article 37 of the Act.
 Article 32 (Use of Consumer Information Necessary for Identification of Consumers to Prevent Misappropriation)
"Cases specified by Presidential Decree" in Article 23 (1) 10 (c) of the Act (including where the aforesaid provisions shall apply mutatis mutandis pursuant to Article 29 (3) of the Act) means the following cases:
1. Where information about a consumer is provided to a person who falls under any of the following items in order to verify the identity or real name of the consumer or the consumer's actual intention:
(a) A key telecommunications business entity as defined in Article 5 (3) 1 of the Telecommunications Business Act;
(b) A credit information company as defined in subparagraph 5 of Article 2 of the Credit Information Use and Protection Act;
(c) A settlement agency involved in the payment of proceeds for the relevant transaction;
(d) A person engaging in the business of verifying real names for preventing misappropriation in accordance with an Act and subordinate statutes or with authorization or permission under an Act and subordinate statutes;
2. Where such information is used to verify whether a minor's legal guardian consents to a transaction by the minor.
 Article 33 (Level of Imposition of Obligations)
"The amount specified by Presidential Decree" in Article 24 (1) 4 of the Act (including where the aforesaid provisions shall apply mutatis mutandis pursuant to Article 29 (3) of the Act) means any of the following amounts or amounts classified in the following subparagraphs, the yearly aggregate of which is 50,000 won: <Amended by Presidential Decree No. 28702, Mar. 13, 2018>
1. Admission fee or the fee for renewal of the membership of a multi-level marketing salesperson or door-to-door salesperson under sponsorship: 10,000 won. The admission fee or renewal fee in such cases shall not exceed expenses actually paid by a business entity engaging in multi-level marketing or door-to-door sales under sponsorship for admission or renewal;
2. Where an obligation to purchase sales aids is imposed: 30,000 won per year, per multi-level marketing salesperson or door-to-door salesperson under sponsorship. In such cases, the amount collected from a multi-level marketing salesperson or door-to-door salesperson under sponsorship as the price for sales aids shall not exceed expenses incurred by the business entity engaging in multi-level marketing or door-to-door sales under sponsorship in providing such sales aids (or the market price, if such expenses exceed an mount equivalent to the market price of such sales aids);
3. Where an obligation to undergo education is imposed: Education shall be limited to education on compliance with statutes for consumer protection, etc. or education on other curricula specified by the Fair Trade Commission, and the education fee shall not exceed 30,000 won per year, per multi-level marketing salesperson or door-to-door salesperson under sponsorship. The education fee collected in such cases shall not exceed actual expenses;
4. Cases not falling under subparagraphs 1 through 3 where obligation is imposed regardless of name or form, such as where expenses or other money or valuables are collected.
 Article 34 (Person Authorized to Request for Cessation of Violation and Procedure for Requesting Cessation of Violation)
(1) "A consumer organization specified by Presidential Decree" in Article 25 of the Act (including where the aforesaid provisions shall apply mutatis mutandis pursuant to Article 29 (3) of the Act) means a corporation or organization that falls under any of the following subparagraphs:
1. A consumer organization registered in accordance with Article 29 of the Framework Act on Consumers;
2. The Korea Consumer Agency established under Article 33 of the Framework Act on Consumers;
3. A nonprofit corporation established with the objective to protect consumers in connection with multi-level marketing or door-to-door sales under sponsorship in accordance with Article 32 of the Civil Act.
(2) A person who intends to request the Fair Trade Commission to take measures necessary to cease a violation in accordance with Article 25 or 29 (3) of the Act shall submit a document stating the following matters to the Fair Trade Commission:
1. The business entity engaging in multi-level marketing or door-to-door sales under sponsorship or the multi-level marketing salesperson or door-to-door salesperson under sponsorship against whom it is requested to take measures necessary to cease a violation and details of the violation;
2. Details of benefits or damage that has been undermined or sustained, or is likely to be undermined or sustained, due to the violation;
3. Details of measures necessary to cease the violation.
 Article 35 (Standard for Liability for Compensation for Damage where Business Entity Engaging in Multi-Level Marketing or Door-to-Door Sales Under Sponsorship Neglects Duty to Notify)
The standard for the liability of a business entity engaging in multi-level marketing or door-to-door sales under sponsorship in the main body of Article 28 (2) or 29 (3) of the Act shall be based on the amount of loss that has a reasonable causal connection to the violation of a multi-level marketing salesperson or door-to-door salesperson under sponsorship, but shall not exceed the amount of sales related to the violation.
 Article 36 (Standards for Calculation of Ratio of Sales of Door-to-Door Sales Business Entity Under Sponsorship to End-Users)
The standards for calculating the ratio of goods or services sold by a door-to-door sales business entity under sponsorship to consumers, other than salespersons, to goods or services provided to door-to-door salespersons under sponsorship in accordance with Article 29 (2) of the Act (hereinafter referred to as "ratio of sales to end-users") shall be as provided for in attached Table 1.
CHAPTER IV RECURRING TRANSACTIONS AND TRANSACTIONS FOR SOLICITING BUSINESS
 Article 37 (Standards for Amount and Period of Recurring Transactions or Transactions for Soliciting Business)
"The amount and period specified by Presidential Decree" in the main body of Article 30 (1) of the Act shall be 100,000 won and three months respectively: Provided, That the amount in transactions for soliciting business shall be 300,000 won, regardless of the period.
 Article 38 (Matters to be Explained to Consumers in Transactions for Soliciting Business)
"Matters prescribed by Presidential Decree" in Article 30 (1) 5 of the Act means transaction conditions regarding profits that a person will gain through business opportunities provided by a business entity when the person purchases goods or services from the business entity or regarding the guarantee of such profits.
 Article 39 (Other Matters to be Explained to Consumers)
"Matters specified by Presidential Decree" in Article 30 (1) 9 of the Act means matters regarding restrictions related to the conditions of sales, such as the date and timing, territories, and quantity of sales, and place of delivery.
 Article 40 (Grounds for Restriction on Termination of Contracts for Recurring Transactions or Transactions for Soliciting Business)
"Where specified by Presidential Decree" in the proviso to Article 31 of the Act means where goods or services are to be produced specially in accordance with the order of a consumer (including the opposite party to a transaction for soliciting business; hereinafter the same shall apply); the relevant business entity engaging in recurring transactions or transactions for soliciting business (hereinafter referred to as "business entity engaging in recurring transactions or transactions for soliciting business") is likely to sustain a severe and irrecoverable loss if the consumer is allowed to withdraw subscription or cancel the relevant contract; and thus the business entity engaging in recurring transactions or transactions for soliciting business notifies the consumer of the fact separately with regard to the relevant transaction and obtains written consent thereto from the consumer (including an electronic document).
 Article 41 (Refund of Proceeds or Reduction of Penalty Following Return of Goods or Services)
(1) When a consumer returns goods or services in accordance with Article 32 (2) of the Act, the relevant business entity engaging in recurring transactions or transactions for soliciting business shall add the value of returned goods or services to the amount refundable upon termination or cancellation of the contract or shall deduct the amount from the penalty the business entity may claim.
(2) When a business entity engaging in recurring transactions or transactions for soliciting business increases a refund or reduces a penalty in accordance with paragraph (1), the business entity shall return the amount so increased or reduced to the consumer within three business days from the date goods or services are returned, or shall request the consumer to pay the amount with the increase or reduction deducted therefrom, if the business entity is entitled to receiving an amount of money, such as the price for goods or services. If a business entity engaging in recurring transactions or transactions for soliciting business delays in taking the measures required by the former part, the business entity shall pay the late payment penalty prescribed by Ordinance of the Prime Minister for the period of delay.
(3) The market value of goods or services, depreciation, etc. shall be taken into consideration in calculating the value of goods or services returned in accordance with paragraph (1).
 Article 42 (Inspection of Records of Transactions of Business Entity Engaging in Recurring Transactions or Transactions for Soliciting Business)
A business entity engaging in recurring transactions or transactions for soliciting business shall take measures necessary to allow consumers to inspect records of transactions of goods or services in person or by telephone or Internet immediately in accordance with Article 33 of the Act and shall dispatch relevant data within three business days, if a consumer requests such data for inspection by mail or other means.
CHAPTER V PROTECTION OF CONSUMERS' RIGHTS AND INTERESTS
 Article 43 (Records, etc. of Transactions Stored and Preserved by Extraordinary Sales Business Entities)
(1) Records of transactions that an extraordinary sales business entity may store or reserve in accordance with Article 36 (1) or (2) of the Act are as follows:
1. Records of labeling and advertising;
2. Records of the execution of contracts or the withdrawal of subscription;
3. Records of the payment of consideration and the provision of goods or services;
4. Records regarding the settlement of consumers' complaints or disputes.
(2) Where an extraordinary sales business entity shall preserve records of transactions in accordance with Article 36 (2) of the Act, including details of conversations necessary for proving facts under Article 36 (1) of the Act, the period for preservation shall be at least three months from the date of contract.
(3) A consumer may request an extraordinary sales business entity to allow him/her to inspect records of transactions stored or preserved in accordance with paragraphs (1) and (2) in person or by telephone, facsimile, or e-mail, and an extraordinary sales business entity shall comply with such request.
 Article 44 (Contract for Indemnity Insurance against Consumer Loss)
(1) A contract executed by a business entity engaging in multi-level marketing or door-to-door sales under sponsorship for indemnity insurance against consumer loss or any similar contract in accordance with Article 37 (1) of the Act (hereinafter referred to as "contract for indemnity insurance against consumer loss") shall satisfy the following requirements: <Amended by Presidential Decree No. 26758, Dec. 22, 2015>
1. The contract shall cover consumer loss due to non-performance of the obligation to refund proceeds, which arises when the right to withdraw subscription or cancel a contract is exercised, or due to non-performance of the obligation to providing goods or services;
2. A buyer of goods or services sold by the person who executes the contract for indemnity insurance against consumer loss shall be designated as the insured or a beneficiary;
3. The contract amount shall meet or exceed the amount determined and publicly announced by the Fair Trade Commission within the limit of the selling price of goods or services;
4. Under the contract, a consumer (including a multi-level marketing salesperson or door-to-door salesperson under sponsorship; hereafterin this Article the same shall apply) can collect damages promptly and easily, and a late payment penalty shall be paid for any delay in paying damages;
5. The contract shall not place any restriction on the method by which a consumer can express his/her intention without a justifiable ground or impose an excessively heavy burden of proof on consumers;
6. The contract shall not place any restriction on the coverage of damages or the liability of the insurer or the person who sells goods or services without a justifiable ground;
7. The contract shall not have any provision likely to cause any risk or loss that consumers are unlikely to anticipate or any provision unfairly unfavorable to consumers;
8. The period of transactions covered by the contract for indemnity insurance against consumer loss shall be at least one year, and no contract shall be easily made for the requirements terminating the contract without any justifiable ground to give disadvantages to consumers;
9. If the contract is an insurance contract or a performance guarantee of obligations, it shall be executed with an insurance company as defined in subparagraph 6 of Article 2 of the Insurance Business Act or a bank as defined in Article 2 (1) 2 of the Banking Act (hereafter in this subparagraph referred to as "insurance company or bank"): Provided, That a door-to-door sales business entity under sponsorship may execute a performance guarantee of obligations that meet the requirements prescribed in subparagraphs 1 through 8 with another door-to-door sales business entity under sponsorship that meets all the following requirements:
(a) Another door-to-door sales business entity under sponsorship with whom the business entity has a continuous business relationship, such as trading of goods or services or consignment sales;
(b) Another door-to-door sales business entity under sponsorship who is in a contract for indemnity insurance against consumer loss that is entered into with an insurance company or bank or a mutual aid association established pursuant to Article 38 of the Act (hereinafter referred to as "mutual aid association") for the door-to-door sales business entity under sponsorship who has a continuous business relationship.
(2) A contract for indemnity insurance against consumer loss that the Fair Trade Commission recommends to execute in accordance with Article 37 (2) of the Act shall satisfy the requirements prescribed in paragraph (1) 1 through 7 and 9.
(3) Except for matters provided for in paragraphs (1) and (2), matters necessary for the detailed guidelines for, and details of and procedures for compensation for loss under a contract for indemnity insurance against consumer loss according to the nature of goods or services or transactions, and for the use of the mark of a contract for indemnity insurance against consumer loss shall be prescribed by Ordinance of the Prime Minister.
 Article 45 (Authorization for Establishment of Mutual Aid Association, etc.)
(1) When it is intended to establish a mutual aid association, not less than ten persons shall promote the establishment as promoters, adopt articles of association at the inaugural meeting with consent of at least one-half of members, and file an application for authorization with the Fair Trade Commission. <Amended by Presidential Decree No. 26758, Dec. 22, 2015>
(2) When the Fair Trade Commission gives authorization under paragraph (1), it shall publicly announce such fact.
 Article 46 (Contributions)
Contributions paid to a mutual aid association in accordance with the main sentence of Article 38 (4) of the Act shall be at least 20 billion won.
 Article 47 (Matters to be Stipulated in Articles of Association of Mutual Aid Association)
The following matters shall be stipulated in the articles of association of a mutual aid association: <Amended by Presidential Decree No. 26758, Dec. 22, 2015>
1. Objectives;
2. Name;
3. Place of business;
4. The amount per share of contributions, the method of payment, and the calculation of shares;
5. Qualification for members and matters regarding joining and withdrawal;
6. Matters regarding assets and accounting;
7. The organization and operation of the general meeting;
8. Matters regarding the board of directors;
9. Matters regarding executives and employees;
10. Matters regarding the organization of the committee for recommendation of executives, grounds for disqualification of recommenders, and operation of the committee;
11. The procedure for responding to a request by the Fair Trade Commission to punish or dismiss an executive or employee;
12. Matters regarding loans;
13. Matters regarding business affairs and execution of business affairs;
14. Matters regarding amendment of the articles of association;
15. Matters regarding dissolution and disposal of residual assets;
16. Matters regarding the method of public announcement.
 Article 47-2 (Executives of Mutual Aid Association)
(1) A mutual aid association shall have not less than 7 and not more than 15 directors including one chairperson and 2 auditors.
(2) Types of directors, qualifications, quorum, and terms of office for directors and auditors, and the methods of appointing them shall be specified by the articles of association.
(3) The chairperson of the board of directors shall be selected from among the directors in the general meeting as specified by the articles of association.
[This Article Newly Inserted by Presidential Decree No. 26758, Dec. 22, 2015]
 Article 47-3 (Board of Directors of Mutual Aid Association)
(1) A mutual aid association shall have the board of directors.
(2) The board of directors shall consist of directors including the chairperson.
(3) The chairperson shall convene and chair a meeting of the board of directors.
(4) The board of directors shall make a decision with a quorum of a majority of incumbent directors and by a concurring vote of a majority of the directors present.
(5) The board of directors shall deliberate and vote on the following:
1. Matters regarding business plans;
2. Basic policy regarding operation and management of business affairs;
3. Convening the general meeting and agenda items for the general meeting;
4. Matters regarding budget proposals;
5. Matters regarding loans;
6. Acquisition and disposition of important assets;
7. Other matters specified by the articles of association.
[This Article Newly Inserted by Presidential Decree No. 26758, Dec. 22, 2015]
 Article 48 (Operation and Supervision of Mutual Aid Associations)
(1) A mutual aid association shall compile a budget for gross revenue and gross expenditure for each business year and shall submit the budget to the Fair Trade Commission by not later than one month before the commencement of each business year.
(2) A mutual aid association shall complete the settlement of accounts within two months after the end of the relevant business year and shall submit a report on settlement of accounts to the Fair Trade Commission, along with a balance sheet and a profit and loss statement.
(3) A mutual aid association shall keep a copy of the balance sheet and that of the profit and loss statement, which it has submitted to the Fair Trade Commission in accordance with paragraph (2), at its principal place of business and branch offices and shall publicly announce the balance sheet to the public.
 Article 49 (Method, etc. for Ascertaining Intention to Refuse to Receive Telemarketing Calls)
(1) A telemarketer who intends to make telemarketing calls in accordance with the main sentence of Article 42 (2) of the Act shall ascertain consumers' intention to refuse to receive telemarketing calls, which shall be verified and published by the Fair Trade Commission on the system for registration of intention to reject telemarketing calls under Article 42 (1) of the Act (hereafter in this Article referred to as "registration system").
(2) When the Fair Trade Commission intends to select an institution or organization to which it intends to entrust the operation of the registration system in accordance with Article 42 (4) of the Act, it shall hear opinions of experts in related areas and select an institution or organization that meets all the following standards:
1. It shall have specialized human resources equipped with knowledge about laws and electronic system necessary for the operation of the registration system;
2. It shall have facilities, including electronic equipment, necessary for the stable operation of the registration system and protection of personal information.
(3) When the Fair Trade Commission conducts an investigation under the forepart of Article 42 (5) of the Act, it shall inform persons subject to an investigation of investigation plans, including purposes of an investigation, period of an investigation, and details of an investigation, in advance. <Newly Inserted by Act No. 25527, Jul. 28, 2014>
CHAPTER VI INVESTIGATION AND SUPERVISION
 Article 50 (Organization, etc. of Investigation Team)
(1) An investigation team provided for in Article 43 (4) of the Act (hereafter in this Article referred to as "investigation team") shall be comprised of a leader and members; the leader shall be appointed from among public officials of the Fair Trade Commission, while other members shall be appointed from among public officials of the Fair Trade Commission and employees designated by the President of the Korea Consumer Agency from among employees under his/her jurisdiction.
(2) If it is necessary to organize an investigation team, the Fair Trade Commission shall request the President of the Korea Consumer Agency to designate members for the team with a document stating the period of investigation, matters subject to investigation, and the number of persons required to conduct the investigation.
(3) An investigation team shall conduct its activities under the leader's direction and supervision.
 Article 50-2 (Methods, Procedures, etc. for Conducting Fact-finding Surveys)
(1) The scope of fact-finding surveys conducted under Article 43-2 (1) of the Act (hereinafter referred to as "fact-finding surveys" in this Article) shall be as follows:
1. Matters concerning consumer damage caused by extraordinary sales (referring to extraordinary sales under the main body of Article 4 (1) of the Act; hereinafter the same shall apply in this Article);
2. Matters concerning the current status of the extraordinary sales market, including turnover of business entities engaging in extraordinary sales (referring to extraordinary sales business entities under Article 35 (2) of the Act);
3. Matters concerning the distribution structure of the extraordinary sales market;
4. Other matters necessary for the formulation and implementation of policies for the establishment of the sound trade order in the extraordinary sales market and protection of consumers.
(2) When the Fair Trade Commission conducts a fact-finding survey, it shall inform persons subject to such survey of a relevant survey plan, including purposes, period, and details of such survey.
(3) The Fair Trade Commission may entrust a fact-finding survey to any of the following:
1. A mutual aid association established under Article 38 of the Act;
2. An institution or organization under any of the subparagraphs of Article 42 (3) of the Act;
4. A organization or association comprised of business entities engaged in the relevant industries, the establishment of which is permitted by the heads of central administrative agencies in charge of the relevant industries in which goods, etc. traded through extraordinary sales.
[This Article Newly Inserted by Act No. 25527, Jul. 28, 2014]
 Article 51 (Payment of Rewards)
(1) To be eligible for the payment of a reward provided for in Article 44 (1) of the Act, a person shall be one who reports, or informs of, a violation specified in any subparagraph of Article 44 (1) of the Act and submits evidentiary materials proving such violation first: Provided, That a business entity who commits such violation shall be excluded herefrom.
(2) Except in extenuating circumstances, the Fair Trade Commission shall pay a reward within three months from the date on which it determines that the act reported or informed of constitutes a violation of the Act (or the date on which a decision is made, if an objection has been filed).
(3) No investigative officer involved in the payment of a reward shall provide or divulge to any other person information about the identity of the person who reported or informed of a violation or other matter related to reporting or informing of the violation.
(4) The level for rewards shall be determined and publicly announced by the Fair Trade Commission within the limit of ten million won.
(5) The Fair Trade Commission may establish a committee for deliberation on rewards for reporting (hereafter in this Article referred to as the "Deliberative Committee") in order to deliberate on matters regarding payment of rewards.
(6) Matters regarding the establishment and operation of the Deliberative Committee and other matters necessary for the payment of rewards shall be determined and publicly announced by the Fair Trade Commission.
 Article 52 (Disclosure of Information about Unfair Practices)
(1) When the Fair Trade Commission intends to disclose information about unfair practices in accordance with Article 45 of the Act, it shall notify the relevant business entity of details of information to be disclosed and shall provide the business entity an opportunity to rebut such details.
(2) The Fair Trade Commission may disclose the information provided for in paragraph (1) and the rebuttal to such information through its web-site so as to extensively inform consumers thereof.
 Article 53 (Fairness in Evaluation and Certification)
(1) An evaluator or certifier as defined in Article 46 (1) of the Act shall disclose the following matters, as prescribed by the Fair Trade Commission:
1. The evaluator's or certifier's name;
2. The evaluator's or certifier's address or place of business;
3. The scope of evaluation or certification;
4. The date of commencement of evaluation or certification;
5. Matters regarding the standards, procedure, and method for evaluation or certification.
(2) Matters specified in subparagraphs of paragraph (1) shall be disclosed in such a manner that consumers can readily inspect and verify such matters.
 Article 54 (Duty to Report)
When a Mayor/Do Governor or the head of a Si/Gun/Gu makes a recommendation or disposition regarding rectification, he/she shall report thereon to the Fair Trade Commission without delay in accordance with Article 47 (1) of the Act. such report may be made by electronic documents.
CHAPTER VII RECTIFICATIONS, IMPOSITION OF PENALTY SURCHARGES, ETC.
 Article 55 (Publication of Measures Taken for Rectification)
When the Fair Trade Commission orders a business entity to publish that measures have been taken against the business entity for rectification in accordance with Article 49 (3) of the Act, it shall specify the details and frequency of the publication in the order, taking the following matters into consideration:
1. Details and the degree of violations;
2. The period and frequency of violations;
3. The extent and degree of consumer loss caused by violations.
 Article 56 (Guidelines for Suspending Operation of Business and Revoking Registration)
The guidelines for suspending operation of business and revoking registration under Article 49 (4) and (5) of the Act are as specified in attached Table 2.
 Article 57 (Organization for Mediation of Disputes over Consumer Loss)
"An organization specified by Presidential Decree for the mediation of disputes over consumer loss" in Article 50 (1) of the Act means any of the following organizations:
1. The Korea Consumer Agency established under Article 33 of the Framework Act on Consumers:
2. An organization established by a Mayor/Do Governor in accordance with Article 16 of the Framework Act on Consumers and Article 7 of the Enforcement Decree of the aforesaid Act for redressing consumer loss;
3. Other organizations established and operated for the mediation of disputes under consumer-protection-related Acts and subordinate statutes.
 Article 58 (Confirmation of No Measures to be Taken for Rectification upon Acceptance and Performance of Proposal for Mediation of Dispute over Consumer Loss)
(1) A party to mediation of a dispute under Article 50 of the Act may submit to the Fair Trade Commission a document certifying that the party implemented the mediation proposal by the organization for mediation of disputes over consumer loss within ten days from the date the party implemented such proposal and may request the Fair Trade Commission to confirm that the party does not need to take any measure for corrective action under Article 49 of the Act.
(2) Upon receipt of a request under paragraph (1), the Fair Trade Commission shall give notice to a business entity of matters exempted from measures for corrective action.
 Article 59 (Imposition and Payment of Penalty Surcharges)
(1) When the Fair Trade Commission imposes a penalty surcharge in accordance with Article 51 of the Act, it shall give written notice clearly stating the category of violation and the amount of the penalty surcharge, and demanding payment thereof.
(2) A person to whom notice is given under paragraph (1) shall pay the penalty surcharge to the receiving agency designated by the Fair Trade Commission within 60 days from the date on which the notice is given: Provided, That if a person is unable to pay a penalty surcharge within such period due to a natural disaster or other extenuating ground, he/she shall pay it within 30 days from such ground does not exist.
 Article 60 (Calculation of Sales Related to Violation)
"The sales related to the relevant violation specified by Presidential Decree" in the former part of Article 51 (1) of the Act means the amount calculated in accordance with the following classification: Provided, That if two or more subparagraphs are applicable to the violation at issue, the greater of the amounts calculated shall be deemed related sales:
1. If the violation at issue does not directly generate sales or cause consumer loss: The amount equivalent to ten percent of sales from the time when the violation at issue occurs until the time the violation ends (if the violation does not end until the time a penalty surcharge is imposed, the date on which the Fair Trade Commission resolves to order the imposition of a penalty surcharge shall be deemed the date on which the violation ends): Provided, That if a violation is limited to a particular area, the penalty surcharge shall be based on sales in the particular area;
2. If the violation at issue directly generates sales: The amount equivalent to the total sales that has the direct causal relationship with the violation at issue;
3. If the violation at issue directly causes consumer loss: The amount equivalent to the total sales with which loss occurs due to the violation at issue.
 Article 61 (Guidelines for Imposition of Penalty Surcharges)
(1) Guidelines for the imposition of penalty surcharges under Article 51 (5) of the Act are as provided for in attached Table 3.
(2) Except for matters provided for in this Decree, detailed guidelines necessary for imposition of penalty surcharges shall be determined and publicly notified by the Fair Trade Commission.
CHAPTER VIII SUPPLEMENTARY PROVISIONS
 Article 62 (Registration of Business Entities' Association)
(1) A business entities’ association that intends to file for registration in accordance with Article 54 (1) of the Act shall file an application stating the following matters with the Fair Trade Commission:
1. Objectives;
2. Name;
3. The addresses of its principal place of business and chapters, and the address of its web-site;
4. The name, resident registration number, address, telephone number, and e-mail address of its representative;
5. The date of its establishment;
6. The number of members (including the number of members in its chapters);
7. Details of business activities.
(2) An application filed in accordance with paragraph (1) shall be accompanied by articles of association and the following data:
1. The current status of human resources and finance and a plan for securing financial resources;
2. A list and functions of major facilities.
(3) If any matter specified in any provision of paragraph (1) 1 through 4, 6, and 7 and subparagraphs of paragraph (2) changes, the business entities' association registered in accordance with Article 54 (1) of the Act shall notify the Fair Trade Commission of the change within 20 days from the date on which such change occurs.
 Article 62-2 (Processing Personally Identifiable Information)
(1) The Fair Trade Commission, a Special Self-Governing City Mayor, a Special Self-Governing Province Governor, or the head of a Si/Gun/Gu (including persons delegated or entrusted with the relevant authority) may process data including resident registration numbers or alien registration numbers referred to in Article 19 of the Enforcement Decree of the Personal Information Protection Act, in extenuating circumstances to perform the following:
1. Affairs concerning reporting by door-to-door sales or telemarketing business entities under Article 5 (1) of the Act;
2. Affairs concerning reporting on changes by door-to-door sales or telemarketing business entities under Article 5 (2) of the Act.
(2) The Fair Trade Commission or the relevant Mayor/Do Governor (including persons delegated or entrusted with the relevant authority) may process data incluuding resident registration numbers or alien registration numbers referred to in Article 19 of the Enforcement Decree of the Personal Information Protection Act, in extenuating circumstances to perform the following:
1. Affairs concerning registration of multi-level marketing business entities under Article 13 (1) of the Act;
2. Affairs concerning reporting on changes in registered matters by multi-level marketing business entities under Article 13 (2) of the Act;
3. Affairs concerning registration for door-to-door sales entities under sponsorship under Article 13 (1) of the Act, or reporting on changes in registered matters by such sales entities under Article 13 (2) of the Act, which is applicable mutatis mutandis pursuant to Article 29 (3) 1 of the Act.
(3) The Fair Trade Commission may process data including resident registration numbers or alien registration numbers referred to in Article 19 of the Enforcement Decree of the Personal Information Protection Act, in extenuating circumstances to conduct affairs concerning registration for a business entities' association under Article 54 (1) of the Act.
[This Article Newly Inserted by Presidential Decree No. 27988, Apr. 11, 2017]
 Article 62-3 (Re-examination of Regulation)
(1) The Fair Trade Commission shall examine the feasibility of the following matters every two years (referring to the day before each second anniversary from the base date), counting from the following relevant base date; and shall take measures, including improvement:
1. Matters subject to reporting by door-to-door sales entities, etc. under Article 7: January 1, 2017;
2. Door-to-door sales entities, etc. exempt from the duty to report under Article 9: January 1, 2017;
3. Matters included in a contract under Article 11: January 1, 2017;
4. Grounds for restrictions on withdrawal of subscription, etc. under Article 12: January 1, 2017;
5. Means of payment subject to suspension or cancellation of billing for proceeds following withdrawal of subscription, etc. under Article 14: January 1, 2017;
6. Level of obligations imposed on salespersons engaging in door-to-door sales or telemarketing, use of consumer information for delivery, etc. of goods or services, and use of consumer information necessary for verification of identity for prevention of misappropriation under Articles 17 through 19: January 1, 2017;
7. Procedures for registration of multi-level marketing entities, or door-to-door sales entities under sponsorship, under Article 20: January 1, 2017;
8. Amount of capital of multi-level marketing entities under Article 21: January 1, 2017;
9. Cases where multi-level marketing salespersons or door-to-door salespersons under sponsorship are not allowed to withdraw subscription under Article 25: January 1, 2017;
10. Deduction of expenses when refunding proceeds for goods or services under Article 26: January 1, 2017;
11. Offset against debts under Article 27: January 1, 2017;
12. Amendment of guidelines for calculation and payment of bonuses under Article 28: January 1, 2017.
(2) The Fair Trade Commission shall examine the feasibility of the following matters every three years (referring to the day before each third anniversary from the base date), counting from the following relevant base date; and shall take measures, including improvement:
1. Interest rates of late payment penalty referred to in Article 13: January 1, 2017;
2. Limits on a burden imposed on multi-level marketing salespersons or door-to-door salespersons under sponsorship referred to in Article 29: January 1, 2017;
3. Limitation on the price for commodities for sale referred to in Article 30: January 1, 2017;
4. Standards for the amount and period of recurring transactions or transactions for soliciting business referred to in Article 37: January 1, 2017;
5. Standards for refunding proceeds or reducing a penalty following the return of goods or services referred to in Article 41: January 1, 2017;
6. Inspection of records of transactions of business entities engaging in recurring transactions or transactions for soliciting business referred to in Article 42: January 1, 2017;
7. Records, etc. of transactions stored and preserved by extraordinary sales business entities referred to in Article 43: January 1, 2017;
8. Standards for contributions paid to a mutual aid association referred to in Article 46: January 1, 2017;
9. Matters to be stipulated in the articles of association of a mutual aid association referred to in Article 47: January 1, 2017;
10. Methods for ascertaining the intention to refuse to receive telemarketing calls referred to in Article 49: January 1, 2017;
11. Matters to be disclosed by evaluators or certifiers under Article 53: January 1, 2017.
[This Article Wholly Amended by Presidential Decree No. 27751, Dec. 30, 2016]
CHAPTER IX PENALTY PROVISIONS
 Article 63 (Criteria for Imposition of Administrative Fines)
The criteria for imposition of administrative fines under Article 66 (5) of the Act shall be as listed in the attached Table 4.
ADDENDA
Article 1 (Enforcement Date)
This Decree shall enter into force on August 18, 2012.
Article 2 (Applicability to Interest Rate of Late Payment Penalty)
The amended provisions of Article 13 shall apply where a door-to-door seller or telemarketer delays refunding to a customer, proceeds for goods or services after this Decree enters into force.
Article 3 (Applicability to Guidelines for Suspending Operation of Business and Revoking Registration)
The amended provisions of subparagraph 2 (c) and (k) of attached Table 2 (applicable only to a violation of Article 20 (1) of the Act) shall apply to violations committed after this Decree enters into force.
Article 4 (Transitional Measures concerning Guidelines for Suspending Operation of Business and Revoking Registration)
(1) Notwithstanding the amended provisions of Article 56 and attached Table 2, a violation committed before this Decree enters into force shall be governed by the former provisions in applying provisions regarding suspending operation of business and revoking registration for such violation.
(2) If a person against whom an administrative disposition was made for a violation specified in attached Table 2 in accordance with the former provisions re-commits another violation against the same provisions after this Decree enters into force, such person shall be deemed to commit such violation for the first time under this Decree, and if a person who was punished by administrative dispositions for violations two or three times in accordance with the former provisions re-commits another violation against the same provisions after this Decree enters into force, such person shall be deemed to commit such violation for the second or third time under this Decree.
(3) Notwithstanding the amended provisions of the former part of subparagraph 1 (b) of attached Table 2, when the guidelines for administrative dispositions according to the frequency of violations are applied to violations committed after this Decree enters into force in applying paragraph (2), administrative dispositions made for violations committed before this Decree enters into force shall be included in calculating the frequency of violations, only if such administrative dispositions were made for a violation committed by up to one year after this Decree enters into force.
Article 5 (Transitional Measure concerning Guidelines for Imposition of Penalty Surcharges)
Notwithstanding the amended provisions of Article 61 (1) and attached Table 3, the former guidelines for imposition of penalty surcharges shall apply to violations committed before this Decree enters into force.
Article 6 (Transitional Measures concerning Criteria for Imposition of Administrative Fines)
(1) Notwithstanding the amended provisions of Article 63 and attached Table 4, the former criteria for imposition of administrative fines shall apply to violations committed before this Decree enters into force.
(2) Notwithstanding the amended provisions of subparagraph 1 (b) of attached Table 4, when the criteria for imposition of administrative fines according to the frequency of violations, are applied to violations committed after this Decree enters into force, administrative dispositions made for violations committed before this Decree enters into force shall be included in calculating the frequency of violations, only if such administrative dispositions were made for a violation committed by up to one year after this Decree enters into force.
Article 7 Omitted.
Article 8 (Relations to other Acts and Subordinate Statutes)
If an Act or subordinate statute in force as at the time this Act enters into force cites a provision of the former Enforcement Decree of the Door-to-Door Sales, etc. Act, such citation shall be deemed a citation of the relevant provision of this Decree in lieu of the former provision, if such provision exists in this Decree.
ADDENDA <Presidential Decree No. 24076, Aug. 31, 2012>
Article 1 (Enforcement Date)
This Decree shall enter into force on September 2, 2012 (Proviso Omitted.)
Articles 2 through 4 Omitted.
ADDENDA <Presidential Decree No. 24436, Mar. 23, 2013>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Articles 2 and 3 Omitted.
ADDENDUM <Presidential Decree No. 25527, Jul. 28, 2014>
This Decree shall enter into force on July 29, 2014.
ADDENDA <Presidential Decree No. 25840, Dec. 9, 2014>
Article 1 (Enforcement Date)
This Decree shall enter into force on January 1, 2015.
Articles 2 through 16 Omitted.
ADDENDUM <Presidential Decree No. 26035, Jan. 6, 2015>
This Decree shall enter into force on the date of its promulgation.
ADDENDUM <Presidential Decree No. 26758, Dec. 22, 2015>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 27606, Nov. 22, 2016>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Article 2 (Applicability to Guidelines for Suspending Operation of Business)
The amended provisions of subparagraph 2 of attached Table 2 shall begin to apply where the relevant violation is committed after this Decree enters into force.
Article 3 (Transitional Measures concerning Interest Rate of Late Payment Penalty)
Notwithstanding the amended provisions of Article 13, the former provisions shall apply to the interest rate for the period of delay that occurs after this Decree enters into force, if a door-to-door seller or telemarketer delays refunding, to a customer, proceeds for goods or services, before this Decree enters into force.
ADDENDA <Presidential Decree No. 27751, Dec. 30, 2016>
Article 1 (Enforcement Date)
This Decree shall enter into force on January 1, 2017. (Proviso Omitted.)
Articles 2 through 12 Omitted.
ADDENDA <Presidential Decree No. 27988, Apr. 11, 2017>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Article 2 (Applicability to Documents to be Verified in Relation to Report Filed by Door-to-Door Sales Entity, etc.)
The amended provisions of the proviso to Article 8 (2) 1 shall begin to apply where a report is submitted to the Fair Trade Commission, a Special Self-Governing City Mayor, a Special Self-Governing Province Governor, or to the head of a Si/Gun/Gu pursuant to paragraph (1) of said Article, after this Decree enters into force.
ADDENDUM <Presidential Decree No. 28702, Mar. 13, 2018>
This Decree shall enter into force on the date of its promulgation.