🔒 Privacy Law Violation
South Korea’s Personal Information Protection Commission (PIPC) fined AliExpress $1.4M for violating privacy laws. The fine includes a 2 billion won ($1.4M) penalty and an additional 7.8 million won. The PIPC found AliExpress shared customer data with about 180,000 sellers, mostly in China, without proper safeguards. "The decision made it clear that foreign e-commerce operators must comply with national protection laws," stated the PIPC. AliExpress must now take corrective measures and improve its data protection protocols.
🛡️ Required Corrective Actions
AliExpress has been ordered to take specific steps to comply with South Korea's privacy laws. These include informing customers about overseas data transfers and implementing privacy protection measures in vendor contracts. The PIPC also recommended AliExpress adopt self-regulations or create its own measures to align with local regulations. During the investigation, AliExpress began establishing legal grounds to obtain users' consent for overseas data transfers.
📊 Market Impact
AliExpress is the second-largest e-commerce player in South Korea, with 8.4 million monthly active users (MAU). It is closely followed by Temu, which has 8.2 million MAU. Despite this, Coupang Inc. remains the dominant market leader. South Korea’s actions against AliExpress come amid concerns over the rapid expansion of foreign e-commerce platforms and their impact on local businesses. The government is also investigating Temu for similar privacy issues.
📈 Future Measures
South Korea’s antitrust body launched an investigation into AliExpress in March for alleged consumer protection violations. The country plans to introduce stricter e-commerce policies targeting Chinese platforms like AliExpress, Temu, and Shein. This move is in response to increasing complaints about fake products and inadequate dispute resolution services. The PIPC’s actions highlight South Korea's commitment to enforcing its privacy laws and protecting consumer rights amid the growing presence of foreign e-commerce giants.
Will South Korea’s fines impact foreign e-commerce growth?
