In the future, even if the online video service (OTT) such as Netflix, Season, and Watcher is canceled, it will be possible to receive a refund if there is only usage history.
The Fair Trade Commission announced on the 27th that it has reviewed the service terms and conditions of six domestic OTT platform operators, including Netflix, Wave, Teabing, Season, Watcher, and Google, to correct seven types of unfair terms and conditions.
In particular, even if Netflix canceled mid-term, it was obligated to use the remaining period without receiving a refund in any case within the payment cycle (1 month). If you do, you can get a refund.
Google, Season, and Watcha are scheduled to be implemented before February 10th, while Netflix is scheduled to run until March. Wave has been in effect since September 24, last year, and Teabing has been in effect from December 15 last year.
An official from the FTC said, “With the expansion of the online subscription economy, the number of OTT subscribers has increased since 2018, and the non-face-to-face transaction and subscription economy has expanded since Corona 19, so it is necessary to provide minimum standards for cancellation and refund, so major OTT operators such as Netflix use it. We checked the actual conditions and took corrective action.”
In the field of OTT services, the number of 1372 counseling center applications related to termination and refunds increased from 111 in 2018 to 188 in 2019 and 590 in 2020.
The Fair Trade Commission said that the operators decided to voluntarily correct all the provisions of unfair terms and conditions during the review process.
The provision of non-refundable in case of intermediate cancellation allows for cancellation and refund within 7 days after the payment date, taking into account the payment cycle (usually 1 month) if there is no usage history. Season and Watcha were customarily giving refunds if there were no usage details if the customer canceled within 7 days of payment, but this was not clearly defined in terms of the terms and conditions.
We have revised these provisions, such as refunding the penalty provisions unfairly disadvantageous to customers without mutual penalty.
The provisions restricting the right to withdraw subscription were revised to reflect the purpose of the Electronic Commerce Act. It is limited to cases where service provision is started or there is a history of use through streaming or downloading.
The provisions for arbitrary rate changes without prior notice or consent have been corrected so that the subscription will not be renewed if the customer does not agree with the prior consent of the price increase. In the case of any important changes to the service, prior notice or explanation was made.
Refunds have also been resolved, such as non-refundable provisions for non-refundable or gifted cyber money. The related terms and conditions were revised or deleted so that cash or cyber money could be compensated, and cyber money received as a gift could be refunded fairly.
The provisions for which the reasons for termination and immediate termination of a member account are unclear have specifically set the reasons for account termination and contract termination, such as termination or termination of the account in case of illegal use such as video piracy.
In relation to the provision of free trials, customer explanations were strengthened. From the time customers sign up for Netflix or Watcha, they made it clear that the service subscription is a paid service subscription contract. In addition, the criteria for cancellation and refund are explained on the sign-up screen, and a provision for member notification before the free trial ends according to the terms and conditions.
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The Fair Trade Commission expected that this corrective measure would systematically guarantee consumer rights such as correcting unfair terms and conditions in the OTT field and establishing minimum cancellation and refund standards.
The FTC plans to continuously check and strengthen monitoring of unfair terms and conditions in the online platform field to improve consumer rights and interests.