Watchdog fines AliExpress, affiliates over breaches of consumer protection, advertising laws

AliExpress logo is seen in this illustration taken Feb. 11. [REUTERS/YONHAP]

 
The Korea Fair Trade Commission (FTC) has fined AliExpress and its affiliates for violating consumer protection and advertising laws, in a move aimed at tightening oversight of foreign e-commerce platforms. 
 
The antitrust regulator said Friday it imposed corrective orders and penalties on five companies linked to AliExpress. Alibaba Singapore, AliExpress Korea Holdings and AliExpress Korea LLC were each fined 2 million won ($1,440) for failing to provide required business details and for withholding seller information from consumers.
 
 
Two other affiliates — OceanSky Internet Information Technology and MICTW Supply Chain Service Singapore — received a combined fine of 2.09 billion won in fines for false advertising.
 
Regulators found that Alibaba Singapore, which operates the AliExpress marketplace, did not display mandatory business information on its main or linked pages. That included the company’s name, address, phone number, email address and representative’s name, as required under the E-Commerce Act. 
 
The firm also failed to register as an online business operator despite acting as an intermediary between sellers and buyers. It did not disclose the identities or contact details of third-party sellers before purchases were completed, the commission said. 
 
AliExpress Korea faced similar charges. It ran a sub-channel called “K-Venue” with Alibaba Singapore, contracting with domestic sellers but failing to show its own business details on the platform. It also withheld required seller information such as phone numbers, email addresses and business registration numbers. 
 

AliExpress logo is seen in this illustration taken Feb. 11. [REUTERS/YONHAP]

 
Separately, OceanSky and MICTW promoted goods using “regular prices” that had never been applied in actual sales. By inflating reference prices and advertising “discounted” sale prices, the companies created the illusion of steep savings, misleading buyers about the true economic value of their purchases.
 
The FTC ruled that the practice constituted false and exaggerated advertising under the Fair Labeling and Advertising Act, saying it distorted consumer choice.
 
In a statement, the commission said the enforcement action was meant to remind foreign platforms that they must comply with the same rules as domestic operators.
 
“The commission expects these measures to help establish a sound order in the e-commerce sector by ensuring that overseas platforms meet the same obligations as domestic businesses,” the FTC said in a statement.
 
The regulator added that it will continue monitoring the e-commerce sector for violations that infringe on consumer rights and will apply the law equally to both Korean and international platforms to ensure a safe and trustworthy market environment.

BY LIM JEONG-WON [[email protected]]