CONTENTS
- 1. Violation of the Monopoly Regulation and Fair Trade Act | A Corrective Order for Improper Online Advertising
- - What Is Unfair Internet Labeling and Advertising?
- - Fair Trade Commission Strengthens Prompt Correction of Improper Online Advertising
- 2. Violation of the Monopoly Regulation and Fair Trade Act | Corporate Advisory Matters Concerning the Act on Fair Labeling and Advertising
- - Assessment of Existing Advertising Materials and Identification of Risks
- - A Response Manual Based on the Fair Trade Commission's Review Guidelines
- 3. Violation of the Monopoly Regulation and Fair Trade Act | Reducing the Risk of Violations Through Advisory
1. Violation of the Monopoly Regulation and Fair Trade Act | A Corrective Order for Improper Online Advertising
This is a case in which legal advisory was provided to a marketing company that received, from the Fair Trade Commission, a corrective order regarding deceptive advertising on social media on the ground of an ‘improper internet advertisement,’ one of the violations of the Monopoly Regulation and Fair Trade Act.
The client company, which operated numerous pages and channels introducing products, restaurants, and the like through platforms such as YouTube and Instagram, had been carrying out so-called ‘undisclosed advertising’ of user reviews and, last year, was caught in the Fair Trade Commission's ‘undisclosed advertising’ monitoring and had carried out a voluntary correction.
Unlike an individual social-media account holder, the client, who was operating channels and the like in the form of a corporate entity, was highly likely to have its implementation status reviewed on a quarterly basis even after carrying out the voluntary corrective measures.
Accordingly, in order not to violate the Monopoly Regulation and Fair Trade Act through similar cases after implementing the corrective measures, the client requested that the firm establish legal standards applicable across the overall operation of internet advertising so as to fundamentally block the risk of recurrence and of legal violations.
What Is Unfair Internet Labeling and Advertising?
Internet advertising includes advertising that uses any internet medium as a means, such as banners, pop-ups and pop-unders, search advertising, review advertising, and homepages and blogs.
The criteria for determining the unfairness of internet advertising are as follows.
1. The truthfulness, clarity, and currency of the content
2. The relative position, size, and color of the text and the design
In addition, through the ‘Examination Guidelines on Labeling and Advertising regarding Endorsements and Guarantees,’ the Act on Fair Labeling and Advertising specifically prescribes the position, content, and method so that the ‘economic interest’ between the endorser or guarantor and the advertiser is clearly disclosed.
Fair Trade Commission Strengthens Prompt Correction of Improper Online Advertising
In May 2025, the Fair Trade Commission and the Korea Consumer Agency announced that they would strengthen their cooperation in order to promptly correct unfair online advertising and prevent consumer harm.
The Consumer Agency monitors advertising practices, focusing on online media such as open markets and social media, and recommends voluntary correction, and where a party does not comply or the degree of violation is serious, the Fair Trade Commission launches an investigation on its own authority.
In particular, the agencies plan to form joint investigation teams focusing on fields with a high risk of consumer harm, such as childcare products and AI washing, to strengthen investigative capacity and to actively reflect the Consumer Agency's monitoring results.
Going forward, administrative responses to violations of the Monopoly Regulation and Fair Trade Act and the Act on Fair Labeling and Advertising are expected to become more systematic and effective.
2. Violation of the Monopoly Regulation and Fair Trade Act | Corporate Advisory Matters Concerning the Act on Fair Labeling and Advertising
In the case of the client company, if the deceptive labeling and advertising were not corrected again, there was a high likelihood that administrative sanctions and criminal penalties would follow under the Fair Trade Act, such as a temporary suspension order for the advertising, a penalty surcharge of up to 2% of sales, and imprisonment for up to 2 years or a fine of up to 150 million won.
In response, this firm formed a task force of a fair trade attorney specializing in this area for the Fair Trade Act and the Act on Fair Labeling and Advertising together with a corporate advisory attorney, and provided legal advisory on the basis of extensive practical experience with advertising review guidelines.
The purpose of this advisory was to secure the reliability and sustainability of the overall advertising operations, taking into account the balance between the lawfulness of advertising expressions and consumer protection.
Assessment of Existing Advertising Materials and Identification of Risks
The fair trade attorney TF first collected the advertising copy across all media, including online advertisements, mobile banners, and YouTube video scripts, in addition to the customer review advertisements the client company was running, and analyzed them according to the standards to identify matters violating the Monopoly Regulation and Fair Trade Act.
As a result, several portions with expressions that were false or exaggerated were identified, and the firm pointed out that the supporting data was insufficient and established internal processes so that the company could set up its own corrective measures.
-Whether unfavorable contents among consumer reviews were deleted or made private without a reasonable reason
-The clarity of disclosure where economic interests affect the credibility of recommendations, endorsements, and the like
-The use of expressions that are false or exaggerated
A Response Manual Based on the Fair Trade Commission's Review Guidelines
The TF also provided the following response manual for each piece of wording so that the legality of the use of expressions could be judged in advance based on the Fair Trade Commission's “Guidelines for the Review of Internet Advertising” and the “Act on Fair Labeling and Advertising.”
3. Violation of the Monopoly Regulation and Fair Trade Act | Reducing the Risk of Violations Through Advisory
As can be seen from this case of a violation of the Monopoly Regulation and Fair Trade Act, in the process by which a company plans and operates advertising, even a minor expression, or the omission or downplaying of a design, can give rise to a legal risk amounting to a violation of the Monopoly Regulation and Fair Trade Act.
In particular, in the case of internet advertising, the point of contact with consumers is immediate and the speed of spread is fast, so even more thorough review is needed.
Through this advice, the client company completely overhauled its advertising process following the Fair Trade Commission's corrective measure, and through this it was able to lay a foundation for restoring trust and for long-term legal risk management.
Where there is concern about measures by the Fair Trade Commission due to a violation of the Act on Fair Labeling and Advertising or a violation of the internet advertising review guidelines, legal advice from the draft stage of the advertising copy can be very effective.
A company's image and credibility are formed through advertising, and accordingly, legal compliance becomes a core part of marketing strategy.
🔗Legal consultation appointment: through this, you may receive multifaceted legal support on matters related to violations of the Monopoly Regulation and Fair Trade Act, such as the prior review of advertising copy, the application of labeling standards, the response to Fair Trade Commission investigations, and the organization of grounds for reducing a penalty surcharge.
This content is based on actual case studies of Daeryun Law LLC with some adaptations, and the copyright belongs to our firm.
Unauthorized reproduction, duplication, or distribution and other copyright infringements may result in legal action under applicable laws.
