- Korean consumer law applies to foreign services that sell to consumers in Korea; a foreign governing-law clause cannot remove the mandatory protections of the consumer’s country under the Private International Law Act.
- Since 14 February 2025, a subscription business must obtain the consumer’s consent at least 30 days before a free trial converts to paid or a price rises, and may not use six listed dark patterns.
- Consumers can withdraw within 7 days; for digital content, the right is lost on use only if the business disclosed the limit clearly and offered a trial or similar safeguard.
- From 21 January 2027, large foreign online sellers must appoint a Korean domestic agent under the E-Commerce Act — revenue of KRW 1 trillion or a million monthly Korean visitors — on top of the existing agents under data and network laws.
- VAT, data protection and games have their own rules; see our companion guide to digital services.
Foreign subscription businesses reach Korea without trying. A language-learning app, a fitness platform, a password manager, a design tool, a newsletter, a streaming service, an AI assistant — each finds Korean customers through app stores and search, takes their cards, and renews them every month. Korea is a rewarding market for this: high card use, high smartphone use, willingness to pay for content. It is also a market whose consumer regulator, the Korea Fair Trade Commission (공정거래위원회, gongjeong georae wiwonhoe) (KFTC), has made subscriptions a priority, and whose consumers complain effectively through the Korea Consumer Agency.
This guide covers consumer law. VAT on digital services, the Personal Information Protection Act, the domestic agent for data, and game regulation are in our guide to selling digital services to Korea; data protection in depth is in Korea’s GDPR. Read them together: the KFTC, the tax office and the data regulator look at different parts of the same checkout.
Does Korean law apply to a foreign service?
For consumer contracts, yes. The Private International Law Act allows the parties to a consumer contract to choose a governing law, but the choice cannot deprive a consumer habitually resident in Korea of the protection of Korea’s mandatory rules when the business directed its activities at Korea — by marketing there, by offering a Korean-language service, by accepting Korean payments. The same Act lets such consumers sue in Korea. The protections of the Act on Consumer Protection in Electronic Commerce — the E-Commerce Act — are mandatory in that sense.
Enforcement follows. The KFTC has investigated and sanctioned foreign platforms and streaming services, and Korean consumers use the Korea Consumer Agency (한국소비자원, hanguk sobija-won) (hotline 1372) and its dispute mediation committee against foreign businesses as readily as against Korean ones. A foreign company without a Korean office is harder to fine, but not out of reach: the app stores, the card networks and, increasingly, the domestic agent requirements give the regulator a door.
Sign-up: what must be on the screen
Before the consumer pays, the E-Commerce Act requires the business to identify itself — name, address, contact details, business registration — and to show the key terms: the total price, what it buys, the subscription period, how renewal works, how to cancel and how refunds work. The information must be given in a way the consumer can understand and keep, which in practice means Korean for a service marketed to Koreans. Since 2025 the price must be shown in full at the start: revealing fees step by step through the checkout is one of the banned dark patterns.
Two Korean details matter. Prices for consumers are expected to include VAT, so a foreign service registered for Korean VAT shows the VAT-inclusive price; see our digital services guide for the simplified registration. And the Korean consumer expects the price in won. Showing dollars is not unlawful, but card currency conversion and overseas card fees make the final charge different from the displayed price — which is how complaints begin.
The six banned dark patterns
The amendment to the E-Commerce Act in force since 14 February 2025 named six online dark patterns and banned them, with KFTC power to order corrections, suspend business and fine:
| Dark pattern | Korean | What it looks like | Rule |
|---|---|---|---|
| Hidden renewal | 숨은 갱신 | Free trial or low price converts to a paid or higher-priced plan without fresh consent | Consent at least 30 days before conversion or increase |
| Drip pricing | 순차공개 가격책정 | Only part of the price shown first; fees added during checkout | Show the total price from the first screen |
| Pre-selection | 특정 옵션의 사전 선택 | Add-ons or a more expensive plan ticked by default | Options must be chosen by the consumer |
| False hierarchy | 잘못된 계층구조 | The option good for the business shown large and bright, the alternative hidden | Choices presented without misleading emphasis |
| Cancellation obstruction | 취소·탈퇴 등의 방해 | Cancelling harder than signing up — calls, chats, many screens | Cancellation by a method as easy as subscription |
| Repeated interference | 반복간섭 | Repeated pop-ups asking the consumer to reconsider a choice | Allow the consumer to stop the requests for at least 7 days |
E-Commerce Act as amended, in force 14 February 2025; Kim & Chang summary.
For subscription businesses the first and fifth are the ones that bite. Under the amended Act and its Enforcement Decree, a business must obtain the consumer’s consent — not merely send a notice — at least 30 days before a free trial converts to a paid service or before the price of a subscription goes up, explaining the new price, the date and how to decline. A consumer who does not consent should not be charged the new price. Retention screens are allowed, but a cancellation flow that forces the consumer through a phone call, a live chat or a maze of offers is a violation.
Base sanctions for a violation start with a correction order and rise with repetition, up to business suspension and fines; amendments adopted in late 2025 and implemented in 2026 increase fines for repeat offenders by up to 100% and reduce the discount for self-correction. The KFTC has also acted under the earlier rules: it fined and sanctioned Korean streaming and music services in 2024–2025 for failing to tell consumers that a mid-term cancellation option existed.
Cancellation and refunds
The general rule in Article 17 of the E-Commerce Act is a 7-day right to withdraw from an online purchase, counted from the date the service becomes available, and longer — 30 days from discovery, up to three months from supply — where the service is defective or differs from what was advertised. For digital content the right is lost once the consumer starts using it, but only if the business took the safeguards the Act requires: telling the consumer clearly, before payment, that withdrawal is limited, and offering a trial, a sample or partial access so the consumer can judge the content first. A business that skips those steps faces refund claims even after use.
Mid-term cancellation is the Korean argument of the moment. Korean law does not, so far, require a subscription service to refund the unused part of a month or year when a consumer cancels; many foreign services simply stop renewal at the end of the paid period. What the KFTC has enforced is honesty: if a service offers a mid-term cancellation with pro-rata refund, it may not hide it behind the end-of-term option. Annual plans sold at a discount deserve clear terms on what happens if the consumer leaves after three months; the Act on the Regulation of Terms and Conditions lets the KFTC and courts strike out terms that are unfair to consumers, including penalties disproportionate to the service actually used.
Minors are a special case. The age of majority in Korea is 19, and under Article 5 of the Civil Act a contract a minor makes without a guardian’s consent can be cancelled by the minor or the guardian, with a full refund, whatever the content consumed. Games and entertainment apps meet this most often; age checks and parental-consent flows are the only real protection.
Terms and conditions
Korean consumers will read the terms in Korean, and the KFTC reviews the terms of large foreign platforms. Under the Act on the Regulation of Terms and Conditions it has required streaming services and platforms to amend clauses that let them change the service or price unilaterally without proper notice, exclude all liability for their own fault, deny refunds in all circumstances, delete content or accounts without reason, or force consumers to litigate abroad. A clause that names only a foreign court is likely to be unfair against a Korean consumer — and, as above, may not stop a Korean court hearing the case anyway.
Keep a Korean version of the terms and the privacy policy that matches the English one, notify changes in advance with the reason, and make the consequences of cancellation and refunds explicit. Most of the friction we see with Korean consumers starts with a term that is lawful in California and unfair in Seoul.
A Korean consumer who cannot find the cancel button does not churn. He calls 1372.
Voixa Korea
Payments and app stores
A foreign merchant may take Korean cards directly through an international processor; Korean consumers’ Visa and Mastercard cards work abroad, and Korean card issuers will process chargebacks for subscription disputes. Domestic payment methods — local card schemes, Naver Pay, Kakao Pay, Toss and bank transfers — generally require a payment gateway licensed in Korea under the Electronic Financial Transactions Act, which contracts with the foreign merchant and settles abroad. Recurring billing through a Korean gateway is common and lowers decline rates on renewals.
On mobile, app-store billing is subject to Korea’s 2021 amendment of the Telecommunications Business Act, the first law in the world to stop app-market operators forcing developers to use their own in-app payment system. Google and Apple offer alternative billing in Korea, with reduced but still substantial commissions; whether it pays depends on the business. Whatever channel is used, the consumer-law duties sit with the seller of the subscription, not with the store.
Marketing and messages
Korea’s anti-spam rules in Article 50 of the Network Act require prior opt-in consent for advertising messages by email, text and push notification, with “(광고)” at the start of the message, the sender’s identity, an easy opt-out, separate consent for messages between 21:00 and 08:00, and a reminder of consent every two years. Influencer and affiliate marketing follows the KFTC’s endorsement guidelines under the Fair Labelling and Advertising Act: paid relationships must be disclosed clearly in Korean, at the start of the post, not in a hashtag at the end.
Complaints, chargebacks and disputes
Korean consumers have three cheap routes against a foreign subscription service, and they use all of them. The first is the card company: Korean issuers accept disputes over recurring charges, and a pattern of chargebacks on a merchant account quickly costs more than the refunds would have. The second is the Korea Consumer Agency (한국소비자원, hanguk sobija-won), reached through the 1372 consumer counselling centre, which contacts the business, proposes a settlement under the Framework Act on Consumers and, if that fails, sends the case to its dispute mediation committee. Mediation is free for the consumer; a mediated settlement accepted by both sides has the effect of a court settlement. The third is the KFTC, which receives reports and opens investigations when complaints about one service accumulate.
A foreign business can stop most of this at the first step. Answer Korean-language enquiries within a few working days, give a named contact for refunds, keep records of the consents obtained at sign-up, conversion and price change, and refund promptly where the law or the terms require it. The Korea Consumer Agency’s published consumer dispute settlement criteria set out what it treats as a fair refund for interrupted or unused digital services; reading them is a quicker way to calibrate a refund policy than waiting for the first case.
Trials, promotions and bundles
Free trials and introductory prices are lawful and common; what Korean law polices is the transition. A trial must say, before the consumer starts it, what it will cost afterwards, when the charge will fall and how to stop it; and the consumer’s consent to the paid plan must be obtained before the conversion. Introductory prices that rise after a fixed period are a price increase for these purposes. Bundles — a subscription sold with a device, a telecom plan or another service — need the price of each element to be clear, and cancelling one part should not penalise the consumer beyond what the terms disclosed. Discounts conditional on an annual commitment are fine, but the penalty for leaving early must reflect the discount actually received, not the full remaining term.
Domestic agents and the large-service rules
Several Korean laws require foreign services above a certain size to appoint a domestic agent (국내대리인, gungnae daeriin) — a person or company in Korea who receives regulators’ requests and consumers’ complaints:
| Law | Who must appoint | What the agent does |
|---|---|---|
| E-Commerce Act (from 21 January 2027) | Foreign online sellers with prior-year revenue of KRW 1 trillion or more, or at least 1 million Korean visitors a month on average, or those the KFTC has asked for reports | Handles KFTC requests and consumer protection matters; details published on the first screen of the service |
| Personal Information Protection Act | Foreign businesses above revenue or user thresholds, or after a breach | Data protection contact and grievance handling |
| Network Act | Large information-network service providers | Contact for network-law obligations |
| AI Basic Act (in force 22 January 2026) | Foreign AI providers with KRW 1 trillion total revenue, KRW 10 billion AI-service revenue or 1 million daily Korean users | Contact for AI safety and transparency obligations |
| Game Industry Promotion Act | Foreign game publishers above thresholds | Rating, probability disclosure and consumer issues |
Thresholds as reported by Shin & Kim, the US International Trade Administration and earlier guides on this site.
The E-Commerce Act agent is the newest: the amendment was promulgated on 20 January 2026, the thresholds were set by enforcement decree, and the obligation takes effect on 21 January 2027, with fines and business suspension for non-compliance from 21 February 2027. Where the foreign business controls a Korean entity, that entity must act as the agent. Smaller foreign services are not obliged to appoint one, but nothing stops a mid-sized service doing so voluntarily: a Korean contact point that answers in Korean resolves complaints before they reach the KFTC.
AI services
Subscriptions to AI tools now sit under the AI Basic Act (인공지능 기본법, ingong jineung gibonbeop), in force since 22 January 2026. Providers of generative or high-impact AI must tell users in advance that the service runs on AI, label generated outputs, and clearly disclose realistic synthetic audio, images and video. Foreign providers above the thresholds above must appoint a domestic representative. Fines reach KRW 30 million, but the science ministry has announced a grace period of at least a year in which investigations and fines are generally deferred except for serious harm. Build the labels into the product now; retrofitting them under a corrective order is harder.
When to set up in Korea
None of the rules above requires a Korean company. A foreign service can register for VAT, appoint agents, contract a Korean payment gateway and serve Korean consumers from abroad. A Korean subsidiary starts to make sense when the business needs Korean staff for support and partnerships, local enterprise sales, a Korean entity for B2B invoicing with tax invoices, or a local legal person for a licence. Korean subscription revenue invoiced by a Korean subsidiary is taxed in Korea; served from abroad, it is usually not — see our guide to digital services on permanent establishment risk.
A worked example
A German language-learning app has 40,000 paying Korean users on monthly and annual plans, sold through its website and both app stores. It registers for Korean VAT under the simplified scheme and shows VAT-inclusive prices in won. Its free 7-day trial used to convert automatically; it now asks Korean users, by email and in the app, to confirm the paid plan before the trial ends, and when it raises prices it asks for consent 30 days ahead and keeps non-consenting users on the old price until their next renewal.
Cancellation moves to a single screen in account settings. The Korean terms are rewritten: refunds within 7 days if no lesson has been completed, a pro-rata refund on annual plans cancelled after the first month, Korean courts available for Korean consumers. Marketing pushes go only to users who opted in, labelled (광고). The company stays below the domestic-agent thresholds but appoints a Korean customer contact anyway, and its complaint rate through 1372 drops to a handful a year.
Mistakes we see
- Trials that convert silently into paid plans, or price increases by email notice without consent.
- Cancellation only through support chat or a phone call.
- Prices shown without VAT or in a foreign currency, with fees revealed at the end.
- No-refund terms with no trial, no disclosure and no exceptions.
- Foreign-court-only clauses and blanket liability exclusions in Korean consumer terms.
- Marketing pushes without opt-in, or without “(광고)”.
- Ignoring minors in games and entertainment apps.
Korean terms you will meet
Questions readers ask
Does Korean consumer law apply to a foreign subscription service?
Yes, when the service is directed at consumers in Korea. A foreign governing-law clause cannot remove the mandatory protections of the E-Commerce Act, and Korean consumers can sue in Korea.
Can a free trial convert to a paid plan automatically in Korea?
Not without consent. Since 14 February 2025 the business must obtain the consumer’s consent at least 30 days before the conversion, and the same applies to price increases.
What dark patterns are banned in Korea?
Hidden renewal, drip pricing, pre-selection, false hierarchy, obstruction of cancellation and repeated interference.
Do Korean consumers get a refund on digital subscriptions?
They can withdraw within 7 days. Once they use digital content the right is lost only if the business disclosed the limit clearly before payment and offered a trial or similar safeguard.
Must a foreign service appoint a Korean domestic agent?
Large ones must — under the E-Commerce Act, data protection law, the Network Act, the AI Basic Act or game law, depending on the service and its size.
Can a minor’s subscription be cancelled?
Yes. Under the Civil Act a contract by a person under 19 without a guardian’s consent can be cancelled, with a full refund.
Do I need a Korean company to sell subscriptions to Koreans?
No. VAT registration, agents and payment arrangements can all be handled from abroad; a subsidiary makes sense for local staff, B2B sales or licences.
- E-Commerce Act (전자상거래법)
- Kim & Chang — Dark patterns amendment in force
- Shin & Kim — E-Commerce Act enforcement decree and domestic agent, 2026
- Newsis — KFTC sanctions on subscription cancellation, 2025
- US ITA — Korea AI Basic Act
- Pearl Cohen — Korea’s AI Framework Act takes effect
- Lawtalk — Withdrawal, digital content and minors
- Private International Law Act (국제사법)
- KED Global — In-app payment law, 2021
Alexander Baranov
Founder of the BCA Group · cross-border corporate and tax adviser since 2008
Alexander advises foreign founders and groups on company formation, tax structuring and corporate law in more than 40 jurisdictions across Europe, the Gulf, Asia and Latin America. He is the author of nine books on international business and tax and writes regularly for professional finance and tax journals. He works in English, German, Spanish and Russian.
This guide is based on the Korean statutes cited in the text and on our own filings. It is reviewed when the law or official rates change.