ENFORCEMENT DECREE OF THE ACT ON FAIR LABELING AND ADVERTISING
Presidential Decree No. 16430, jun. 30, 1999
Amended by Presidential Decree No. 18312, Mar. 17, 2004
Presidential Decree No. 19429, Mar. 29, 2006
Presidential Decree No. 19958, Mar. 27, 2007
Presidential Decree No. 21349, Mar. 12, 2009
Presidential Decree No. 22774, Mar. 29, 2011
Presidential Decree No. 23230, Oct. 17, 2011
Presidential Decree No. 24081, Sep. 5, 2012
Presidential Decree No. 24835, Nov. 5, 2013
Presidential Decree No. 25050, Dec. 30, 2013
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 2 (Method of Advertizing) |
| 1. | Flyer, pamphlet, sample or ticket; |
| 2. | Internet or PC communications; |
| 3. | Poster, sign, neon sign, ad ballon or electronic display; |
| 4. | Video product, record, books, publication, movie or play; |
| 5. | Other products than one’s own product; |
| 6. | Other media or means similar to the media or means listed in subparagraphs 1 through 5. |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 3 (Contents of Unfair Labeling or Advertising) |
| (1) | False or exaggerated labeling or advertizing under Article 3 (1) 1 of the Act shall be to label or advertize falsely, or by way of inflating facts. |
| (2) | Deceptive labeling or advertizing under Article 3 (1) 2 of the Act shall be to label or advertize through methods such as concealment or understatement of facts. |
| (3) | Unfairly comparative labeling or advertizing under Article 3 (1) 3 of the Act shall be to label or advertize oneself or his/her product or service (hereinafter referred to as “product, etc.”) as being superior or advantageous in comparison with another business entity, business association (hereinafter referred to as business entity, etc.”) or product, etc. of a business entity, etc. without clearly stating the subject or standards of comparison, or without providing objective grounds. |
| (4) | Slanderous labeling or advertizing under Article 3 (1) 4 of the Act shall be to slander another business entity, etc. or the product, etc. of another business entity, etc. by labeling or advertizing them with contents having no objective basis or to slander them by labeling or advertizing unfavorable facts only. |
| (5) | The detailed types and standards of unfair labeling or advertizing under paragraphs (1) through (4) may be determined and publicly notified by the Fair Trade Commission. In such cases, the Fair Trade Commission shall consult with the head of a relevant administrative agency in advance. |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 4 (Method etc. of Verification) |
| (1) | If a business entity, etc. intends to conduct a test or investigation, to verify matters concerning facts contained in labels or advertisements that he/she has placed, pursuant to Article 5 (1), he/she shall comply with the following criteria: |
| 1. | The method of a test or investigation used for verification shall be an objective and appropriate method such as a method generally recognized in the academia or industry; |
| 2. | The test or investigation shall be conducted at a test or investigation agency under statutes, or at a test or investigation agency managed independently from a business entity, etc.: Provided, That this shall not apply if it is deemed impossible or inappropriate to conduct a test or investigation at a test or investigation agency under statutes, or at a test or investigation agency managed independently from a business entity, etc. |
| (2) | The test or investigation agency managed independently from a business entity, etc. under paragraph (1) 2 shall be a test or investigation agency that does not fall under any of the following: |
| (3) | The Fair Trade Commission may determine and publicly notify the detailed matters necessary for requests for and examination of verification data, measures to be taken based on the result of examination, and other relevant matters in relation to the verification of the contents of the labels and advertisements under Article 5 of the Act. |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 5 (Verification Data) |
A business entity, etc. shall, when he/she submits verification data pursuant to the main sentence of Article 5 (3) of the Act, attach, to written documents specifying each of the following matters, documents proving the content thereof: | 1. | Methods of verification; |
| 2. | The name of the test or investigation agency, and the name, address and telephone number of the representative (only applicable to cases where a test or investigation is conducted); |
| 3. | Contents or results of verification; |
| 4. | Where he/she wishes not to disclose to the public any verification data on the ground that it constitutes a business secret, its contents and reason. |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 6 (Public Disclosure of Verification Data) |
| (1) | The Fair Trade Commission may, where he/she makes available for perusal or discloses to the public any verification data pursuant to the main sentence of Article 5 (4) of the Act, do so by summarizing or compiling information necessary for consumers’ choice of purchase. |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 7 (Procedures for Approval for Restriction on Labeling or Advertizing by Business Entities’ Organizations) |
| (1) | In cases where a business entities’ organization intends to obtain approval from the Fair Trade Commission to restrict labeling or advertizing of a business entity that is a member of the business entities’ organization pursuant to the proviso to Article 6 (1) of the Act, it shall submit an application form specifying the reasons and details to the Fair Trade Commission. |
| (2) | The Fair Trade Commission shall, when it receives an application under paragraph (1), decide whether to grant approval, and notify the applicant of its decision in writing within 60 days from the date of the application. |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 8 (Method, etc. of Publication of Receipt of Corrective Order) |
| (1) | The Fair Trade Commission shall, when it renders an order to a business entity, etc. for publication of the fact that a corrective order has been issued or for corrected advertising pursuant to Article 7 (1) 2 or 3 of the Act, it shall determine the contents, frequency, scale, medium, etc. of the publication or corrected advertising in consideration of each of the following matters: |
| 1. | Substance and severity of violations; |
| 2. | Duration and number of violations. |
| (2) | When the Fair Trade Commission renders an order for publication of the fact that a corrective order has been issued or for corrected advertising pursuant to paragraph (1), it may require the relevant business entity, etc. to have consultation with the Fair Trade Commission for the wording, etc. thereof in advance. |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 9 (Requirements, etc. for Temporary Suspension Order) |
| 1. | Where labeling or advertizing has been placed without the material information publicly notified by the Fair Trade Commission under Article 4 of the Act; |
| 3. | Where it is obviously deemed to fall under the detailed types and standards of unfair labeling or advertizing determined and publicly notified by the Fair Trade Commission pursuant to Article 3 (5); |
| 4. | Where it is obviously deemed to be identical or substantially similar to the types of unfair labeling or advertizing in light of judicial precedents or rulings. |
| (2) | Cases where labeling or advertising is likely to cause irrecoverable damage to consumers or competing business entities under Article 8 (1) 2 of the Act shall be any of the following cases: |
| 1. | Where there is a likelihood of serious harm to the safety of the life or body of consumers, or serious damage to their property; |
| 2. | Where there is a likelihood of damage that could make it impossible for a competing business entity to continue business or expose a competing business entity to material managerial crisis. |
| (3) | “Agencies or organizations prescribed by President Decree” under Article 8 (2) of the Act shall mean agencies or organizations falling under any of the following: |
| 3. | The Korea Press Ethics Commission as an incorporated association and the Korea Advertizing Review Board as an incorporated association established under Article 32 of the Civil Act; |
| 4. | Other agencies or organizations established under other statutes to review labeling or advertizing placed by a business entity, etc. |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 10 (Method of Requesting Temporary Suspension Order) |
Consumer organizations, or the agencies or organizations under each subparagraph of Article 9 (3) shall submit to the Fair Trade Commission a written request specifying each of the following matters, in order to request the Fair Trade Commission to issue a temporary suspension order pursuant to Article 8 (2) of the Act: | 1. | The name of a consumer organization, agencies or organizations, and the name, address and telephone number of the representative; |
| 2. | The name of the business entity, etc. who has placed the labeling or advertizing; |
| 3. | The details of the labeling or advertizing that is subject to the temporary suspension order; |
| 4. | Grounds for requesting a temporary suspension order. |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 11 (Raising Objection to Temporary Suspension Order) |
A person who intends to raise an objection to a temporary suspension order pursuant to Article 8 (3) of the Act shall submit to the Fair Trade Commission a written application, specifying matters such as the subject and details of and the grounds for objection, together with documents needed to prove the grounds for or the details of the objection. [This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 12 (Method of Calculating Penalty Surcharge) |
| (1) | “Amount of sales prescribed by Presidential Decree” under the main sentence of Article 9 (1) of the Act means the sales amount, purchase amount or the amount equivalent thereto (hereinafter referred to as “relevant sales amount”) of the relevant products, etc. which have been sold or bought during the period of violation by business entities, etc. (hereinafter referred to as “violating business entity, etc.”) who engaged in the act of labeling or advertizing in violation of Article 3 (1) of the Act. |
| (2) | Matters necessary for the criteria for or method of calculating the relevant sales amount of a violating business entity, etc. under paragraph (1) shall be determined and publicly notified by the Fair Trade Commission. |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 13 (Scope of Business Entity to whom Operating Revenue Applies) |
“Business entities prescribed by Presidential Decree” under the main sentence of Article 9 (1) of the Act mean a business entity who enters the aggregated amount of the price of products, etc. as operating revenues, etc. on financial statements, etc. [This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 14 (Cases, etc. of No Sales Amount) |
“Business entities, etc. prescribed by Presidential Decree” under the proviso to Article 9 (1) of the Act mean when a business entity, etc. falls under any of the following: | 1. | Business operation has not been commenced, or there is no sales performance record due to business suspension, etc.; |
| 2. | He/she fails to submit, or submits falsely, the data for calculation of sales amount; |
| 3. | It is otherwise deemed impractical to calculate the sales amount objectively. |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 15 (Criteria for Imposition of Penalty Surcharge) |
| (2) | Detailed criteria necessary for the imposition of penalty surcharges, other than the matters provided for in this Decree shall be determined and publicly notified by the Fair Trade Commission. |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 16 (Imposition and Payment of Penalty Surcharge) |
| (1) | The Fair Trade Commission shall, when imposing a penalty surcharge under Article 9 of the Act, give a notice of the penalty surcharge in writing, specifying the type of a violation and the amount of the penalty surcharge. |
| (2) | The person who has received a notice pursuant to paragraph (1) shall pay the penalty surcharge to a collecting agency determined by the Fair Trade Commission within 60 days from the date of receipt of the notice: Provided, That when the person is unable to pay the penalty surcharge within such period due to natural disasters or other unavoidable causes, the penalty surcharge shall be paid within 30 days from the date on which the cause ceases to exist. |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 16-2 (Report, etc. by a Person Who Operates Voluntary Review Organization, etc.) |
| (1) | A person who operates a voluntary review organization, etc. (hereinafter referred to as “voluntary review organization, etc.”) under Article 14-2 (1) of the Act shall, when he/she files a report with the Fair Trade Commission, do so in writing or by an electronic document, specifying each of the following matters: |
| 1. | Name of the reporting person (in cases of a corporation, the name of the corporation and its representative, and in cases of an unincorporated association, the name of the unincorporated association and its representative); |
| 2. | Address, telephone number and email address of the reporting person; |
| 5. | Ground for establishment of the voluntary review organization, etc. |
| (2) | An agency or organization falling under subparagraph 1, 3 or 4 of Article 9 (3) shall be deemed to have filed a report under paragraph (1). |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
| Article 16-3 (Composition, etc. of Investigation Team) |
| (1) | The investigation team under Article 16-2 (1) of the Act (hereinafter referred to as “investigation team”) shall be comprised of the team leader and the members thereof. |
| (2) | The leader of the investigation team shall be a public official of the Fair Trade Commission, and the members thereof shall be public officials of the Fair Trade Commission and employees designated by the President of the Korea Consumer Agency under Article 38 (1) of the Framework Act on Consumers (hereinafter referred to as “President of the Korea Consumer Agency”) among its employees. |
| (3) | The Fair Trade Commission shall, when it intends to organize an investigation team, shall request the President of the Korea Consumer Agency to designate members of the team in advance, in writing, specifying matters such as the period of investigation, subject of investigation and the number of persons necessary for the investigation. |
| (4) | The activities of the investigation team including investigation shall be performed under direction and supervision of the team leader. |
[This Article Newly Inserted by President Decree No. 24835, Nov. 5, 2013]
| Article 16-4 (Reexamination of Regulation) |
The Fair Trade Commission shall review appropriateness of the procedures for granting approval for restriction on labeling or advertising by business entities’ organizations under Article 7 every three year from January 1, 2014 (referring to prior to January 1 of every third year), and take measures such as improvement. [This Article Newly Inserted by President Decree No. 25050, Dec. 30, 2013]
| Article 17 (Criteria for Imposition of Administrative Fines) |
[This Article Wholly Amended by President Decree No. 24081, Sep. 5, 2012]
ADDENDA <Presidential Decree No. 16430, Jun. 30, 1999>
| (1) | (Enforcement Date) This Decree shall enter into force on July 1, 1999. |
ADDENDUM <Presidential Decree No. 18312, Mar. 17, 2004>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Decree No. 19429, Mar. 29, 2006>
| (1) | (Enforcement Date) This Decree shall enter into force on March 30, 2006. |
| (2) | (Transitional Measures concerning Penalty Surcharge) For the purpose of applying penalty surcharges to an act committed before this Decree enters into force, and ended before this Decree enters into force or the state of which continues after this Decree enters into force, the pervious provisions shall apply. |
ADDENDA <Presidential Decree No. 19958, Mar. 27, 2007>
Article 1 (Enforcement Date)
This Decree shall enter into force on March 28, 2007. <Proviso Omitted>
Articles 2 through 8 Omitted.
ADDENDUM <Presidential Decree No. 21349, Mar. 12, 2009>
This Decree shall enter into force on the date of its promulgation.
ADDENDA <Presidential Decree No. 22774, Mar. 29, 2011>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Article 2 (Transitional Measures concerning Administrative Fines)
| (1) | When applying the criteria for imposition of administrative fines for a violation committed before this Decree enters into force, the previous provisions shall apply, notwithstanding the amended provisions of attached Tables 2 and 3. |
| (2) | The disposition of imposition of administrative fines for a violation committed before this Decree enters into force shall not be counted in the calculation of the number of violations under the amended provisions of attached Table 3. |
ADDENDA <Presidential Decree No. 23230, Oct. 17, 2011>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Article 2 (Transitional Measures concerning Criteria for Imposition of Penalty Surcharge)
When imposing a penalty surcharge for a violation committed before this Decree enters into force, the previous provisions shall apply, notwithstanding the amended provisions of attached Table 1.
Article 3 (Transitional Measures concerning Criteria for Imposition of Administrative Fines)
For the purpose of applying the criteria for imposition of administrative fines to a violation committed before this Decree enters into force, the previous provisions shall apply, notwithstanding the amended provisions of attached Table 3.
ADDENDA <Presidential Decree No. 24081, Sep. 5, 2012>
Article 1 (Enforcement Date)
This Decree shall enter into force on the date of its promulgation.
Article 2 (Transitional Measures concerning Criteria for Imposition of Penalty Surcharge)
When imposing a penalty surcharge for a violation committed before this Decree enters into force, the previous provisions shall apply, notwithstanding the amended provisions of Article 15 and the provisions of attached Table 1.
ADDENDA <Presidential Decree No. 24835, Nov. 5, 2013>
Article 1 (Enforcement Date)
This Decree shall enter into force on Nov. 14, 2013.
Article 2 (Transitional Measures concerning Criteria for Imposition of Administrative Fines)
For the purpose of applying the criteria for imposition of administrative fines to a violation committed before this Decree enters into force, the previous provisions shall apply, notwithstanding the amended provisions of attached Table 2.
ADDENDUM <Presidential Decree No. 25050, Dec. 30, 2013>
This Decree shall enter into force on January 1, 2014. <Proviso Omitted>