A person takes photos in front of various magazine covers of K-pop groups at a merchandise shop in Myeongdong, central Seoul, on March 27.NEWS1
FTC orders revision of K-pop fan membership refunds, liability terms
Korea’s antitrust regulator found unfair refund, liability and service termination clauses in paid K-pop fan club memberships, leading 24 companies to revise their terms.
The Fair Trade Commission (FTC) identified unfair terms in paid K-pop fan club memberships, prompting major entertainment agencies and fandom platforms to voluntarily revise their policies.
The FTC said Wednesday it found eight types of unfair provisions after reviewing terms and conditions of paid membership programs offered by 18 entertainment agencies — including SM Entertainment, JYP Entertainment, YG Entertainment and BigHit Music — and six fandom platform operators.
All 24 companies agreed to revise the unfair provisions identified by the regulator, according to an FTC briefing on Wednesday.
One of the most significant issues involved refund restrictions. Some companies had prohibited refunds of paid memberships once seven days had passed after purchase, or if the member had used any membership benefit.
The FTC determined that consumers should be allowed to cancel their memberships and receive refunds if they aren't satisfied with the service, as membership benefits can vary depending on when a user joins.
Under the revised terms, consumers will be eligible for a full refund within seven days of purchase if they haven't used any membership benefits. If more than seven days have passed or some services have been used, users will be able to receive a partial refund after deducting the value of services used and cancellation fees.
The FTC also took issue with clauses that exempted businesses from liability.
The FTC sign of its headquarter in SejongYONHAP
YG Entertainment specified that membership refunds aren't available even if content could no longer be provided because a member of the K-pop group left or was replaced. Some companies also included provisions broadly exempting themselves from responsibility for service disruptions or server intrusions caused by third parties.
The FTC said artist management and service operations can fall within the company's scope of responsibility, and such liability exemption clauses are unfair and disadvantage consumers.
Provisions related to service termination will also be revised.
Some companies granted themselves the right to terminate services at will for business reasons. Under the revised terms, operators will be required to specify concrete grounds for service termination, including business closure, transfer of operations or the end of an exclusive artist contract.
The FTC also requested agencies to clarify the grounds for contract termination and service restrictions, providing users with advance notice.
Companies plan to revise refund-related provisions by the end of this year and gradually update the remaining terms and conditions.
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
