Editor’s Note
**Editor’s Note:** The Fair Trade Commission has revised unfair contract terms across 15 clinics, banning no-refund policies for simple change of mind or dissatisfaction, and addressing excessive penalties and restrictions on contract termination.
The terms and conditions for advance treatment of 15 clinics, including dermatology and plastic surgery clinics, which banned refunds entirely due to simple change of mind or dissatisfaction with the results of the procedure, were revised after review by the Fair Trade Commission (FTC).
A number of provisions unfavorable to consumers, such as restricting the termination of the contract or imposing excessive penalties, were also identified and subject to sanctions by the authorities.
According to the Fair Trade Commission on the 19th, a total of six types of unfair terms and conditions were revised, including those restricting contract cancellation and termination, those imposing excessive damages, those excluding legal responsibility of business operators, and those prohibiting litigation.
Recently, advanced medical services that require payment and use of package procedures in advance are expanding, centering on medical institutions such as dermatology and plastic surgery. Consumers actively use advanced medical treatment because they can reduce the inconvenience of repeated payments and receive benefits such as event discounts, but disputes over refunds are also increasing when canceled in the middle.
In response, the FTC recently selected the top 15 clinics that received damage relief from the Korea Consumer Agency over two years (2023-2024) to review their terms and conditions. As a result of the examination, 13 companies had provisions to restrict contract cancellation and termination, and 10 companies had provisions to prohibit litigation and restrict the transfer of pre-payment medical rights, respectively. Provisions that exclude the legal liability of business operators were confirmed in seven companies, and provisions for excessive damages were confirmed in two companies.
The most frequently detected contract cancellation and termination restrictions are cases in which refunds are completely banned due to subjective dissatisfaction with the results of the procedure or the elapse of a certain period from the contract date.
Some clinics also had provisions to impose penalties ranging from 20% to 30% of the payment amount for cancellation. This was also considered invalid as a provision that unfairly increases consumers’ obligation to compensate for damages.
In addition, provisions that prohibit civil and criminal responsibility after a refund, provisions that prohibit lawsuits and objections, provisions that prohibit the transfer of advanced medical treatment rights to others, and provisions that allow only alternative medical treatment without refunds even if designated medical staff leave or take a break were also subject to correction.
As a result, the operators decided to voluntarily correct the terms and conditions to remove the refund restriction clause or to refund the balance after deducting 10% of the penalty based on the consumer dispute resolution standard. The business operator is liable for damages caused by intentional or negligence, and the provisions prohibiting filing a lawsuit and restricting transfer have been deleted. The regulations have been revised to allow refunds even if patients do not agree to replace the designated medical staff.
According to a survey by the Korea Consumer Agency, the number of damage relief cases related to advanced medical treatment has reached 1,150 over the past four years (2021-2024), and the number of applications has increased by about five times from 88 to 449. Among the types of damage, disputes related to contract termination and penalty accounted for the majority at 83.1%.
The 15 clinics subject to sanctions this time are: Darbomnal, Dr. Evers, Me & Me, Beauty Lounge, Blobby, Shine Beam, Snow, Sangsang, Abiju, Pretty, U&I, Oracle Dermatologist, Toks & Feel, Tones, and Forever.
The FTC judged the clause as a violation of Article 9 of the Terms and Conditions Act, stating it has the same effect as charging a penalty for all unused medical expenses.
The Fair Trade Commission said,
