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South Korean FTC Orders Apple to Revise App Store ‘No-Refund’ Policy

South Korean FTC Orders Apple to Revise App Store ‘No-Refund’ Policy

The South Korean Fair Trade Commission on Sunday said that it had ordered both Apple and Google to revise unfair provisions, including their no-refund policy for purchases in their app stores. This marks the first time the antitrust watchdog group has moved against international app store operators.

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‘‘We expect the measure, aimed at protecting consumers, will have a ripple effect on similar cases throughout the world,” the Korea Fair Trade Commission said in a press release.

The Google Play webstore will design a customer refund system based on Web developers’ refund polices. Apple will be required to send notice to users of its App Store when it changes the terms in its contract.

Hwang Won-chul, head of the KFTC’s Adhesion Contract Division was quoted as saying, ““The FTC’s corrective orders will become benchmark cases for other countries, which face growing customer complaints over unfair provisions in contracts of mobile webstore operators.”

“While Google will limit its response to the FTC to the domestic market, Apple said it would consider applying the revised contract terms globally,” he added.

The FTC took action following continued requests by the Citizens’ Coalition for Economic Justice, a nongovernmental organization. In March, the group asked the FC to correct what it termed unfair sales practices of both domestic and foreign mobile app stores. The FTC responded to the demand by ordering domestic companies including KT, SK Planet, LG Electronics and LG Uplus to correct their unfair business terms in contracts for their webstores in March of this year.

The investigation of foreign companies took several more months to complete.

(Via The Korea Herald)

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