South Korea’s Fair Trade Commission (FTC) confirmed on Tuesday that the local branch of the U.S.-based electric vehicle (EV) maker Tesla amended its contract terms after the antitrust regulator orders.
The recommendation came after some buyers filed a complaint with the Fair Trade Commission, claiming that Tesla Korea’s unfair terms and conditions violated the law that protects consumer’s rights. The commission said that it investigated Tesla’s terms and conditions to prevent possible disadvantages to customers.
The FTC ordered the EV seller to amend five unfair clauses, such as its terms of sale concerning damage coverage. Before the revisions, Tesla Korea claimed that the buyers bear full responsibility for any damage or accident on the vehicle during purchase and delivery.
Correction of Terms and Conditions
The amended terms originally stated that the company would only return 100,000 won ($84.40) of commission fees in compensation in the event of vehicle damage during delivery, claiming no accountability.
Now, the revised terms state that Tesla Korea should bear responsibility and compensate for any loss, damage, or accident incurred, either intentionally or by negligence, during the delivery process.
The FTC also ordered Tesla to clarify any reason for canceling an order. Previously, the clause stated that the company could cancel a vehicle order if it considers a customer acting or ordering “maliciously.” Upon the FTC’s order, Tesla revised the terms to state that the company could only issue a cancellation when a customer makes an order for illegal purposes, such as committing a crime.
During a briefing, FTC’s head of terms review department Lee Tae-whi said that the correction of Tesla’s unfair terms and conditions institutionally guarantees the security of customers’ rights.
Tesla would also begin delivering vehicles to locations desired by customers for an additional fee.
The Fair Trade Commission said that it would also recommend a correction to foreign carmakers such as Mercedes-Benz, Volkswagen, and Renault if they also use unfair terms and conditions.
