본문 바로가기
  • Home
Basic Search

The Legal Prospect of the United States for Consumer Protection

  • DONG-A LAW REVIEW
  • 2010, (46), pp.283-305
  • Publisher : The Institute for Legal Studies Dong-A University
  • Research Area : Social Science > Law

Jungjoon Ka 1

1한국외국어대학교

Accredited

ABSTRACT

This article focuses on how U.S. law protects consumers. Like American scholars, Korean ones believe that a consumer is not a proper party in competition with a manufacturer or a commercial provider in making and negotiating a contract. That is why some judicial remedies and legislative statutes are necessary to improve the bargaining power of consumers or to prevent the unilateral practices of commercial sellers or service providers. Most Korean scholars have studied how to improve the bargaining power of consumers and particularly emphasized the issues of standardized contracts for consumer protection. Their efforts have resulted in the legislative outcome of regulating unfair standardized contracts based on German law. Despite such a special statute, they still believe that it is not enough to protect consumers. Recently, a few Korean scholars have become interested in consumer protection law in the United States for two reasons. First, most people are questioning the role of the Korea Fair Trade Commission for consumer protection. The Korea Fair Trade Commission is similar to the Federal Trade Commission in the United States in that it has enormous power in regulating and supervising the antitrust practices of enterprises. On the other hand, unlike its American counterpart, the Korean one has not played a notable role in balancing the asymmetry of trade and negotiation powers between consumers and enterprises. Second, the demands for consumer protection law in the United States have increased particularly since the terms of “unfair or deceptive trade practices” have been mentioned in the Free Trade Agreement between Korea and United States. These terms seem to be used as ways to protect consumers against enterprises. In fact, this term is used under Section 5 of the Federal Trade Commission Act (FTC Act). According to FTC Act § 5(a), “unfair or deceptive acts or practices in or affecting commerce,” are prohibited by any person engaging in commerce. These broad terms of this provision are particularized by the Magnuson-Moss Warranty-FTC Improvement Act (Magnuson-Moss). This Act allowed the FTC to have jurisdiction to reach deceptive or unfair practices and even to define what they are. This means that the FTC is entitled to prohibit unfair or deceptive practices under the FTC Act and to assess whether an act or practice is unfair or deceptive. For example, the FTC may define an unfair act or practice with the following standard: an act or practice is unfair where it (1) causes or is likely to cause substantial injury to consumers, (2) cannot be reasonably avoided by consumers, and (3) is not outweighed by countervailing benefits to consumers or to competition. An act or practice is deceptive where it is likely to mislead a consumer acting reasonably under the circumstances and is likely to affect a consumer’s conduct or decision regarding a product or service. Congress granted the FTC power to obtain restraining orders and preliminary injunctions against unfair or deceptive acts against consumers or those who threatened to violate any provision administered by the FTC. In addition, the civil penalty for violation of such order is up to $10,000 for each violation under Federal Trade Committee Act (FTCA) § 5(l). In other words, any person who engages in unfair or deceptive conduct or who violates the cease and desist order will be subject to a civil penalty. Korean scholars may be interested in how the FTC and FTCA in the United States can improve consumer rights. Indeed, the FTC and FTCA may improve the market functioning by eliminating fraudulent misrepresentation and unconscionable contracts. They may have played a very active role for consumer protection. In this sense, this article introduces how American consumers are legally and judicially protected.

Statistics

  • 347 Viewed
  • 22 Downloaded

Tools

Issue List

Citation status

* References for papers published after 2023 are currently being built.

Basic Search Advanced Search