Live Commerce Poses Risk of Fraud | Be Korea-savvy

Live Commerce Poses Risk of Fraud

This photo, provided by Lotte Department Store shows its live commerce broadcast.

This photo, provided by Lotte Department Store shows its live commerce broadcast.

SEOUL, Oct. 22 (Korea Bizwire)Live commercial broadcasts are gaining popularity as demand for contactless consumption is increasing due to the coronavirus pandemic.

Live commerce combines live streaming and e-commerce in which consumers engage in live interaction with sellers online.

For small businesses struggling with the coronavirus pandemic, live commerce is becoming a new channel for distribution. There are, however, voices of concern.

At a parliamentary audit of the Korea Communications Commission at the National Assembly on Oct. 8, independent lawmaker Yang Jung-suk called on the need to leave video recordings of live commerce to preserve evidence of possible exaggeration or false advertisements.

Live commerce is similar to home shopping on televisions, but purchases are categorized as electronic transactions, rather than broadcasting.

Television home shopping is governed by the broadcasting act, which restricts the process of introducing and selling products.

In contrast, live commerce lacks any governing restrictions, and the practice is exempted from any form of supervision unless the product is found to have a defect.

Some experts argue that consumers lack protection from damages caused by live commerce.

For instance, four people have been apprehended for selling luxury imitations of Chanel and other brands via live broadcasting on social media, and have been accused of selling more than 62.5 billion won (US$55 million) worth of counterfeit luxury products between June 2018 and November of last year.

“The newly emerging live commerce market is still exposed to the risk of consumer complaints and damages,” said Prof. Lee Eun-hee from Inha University.

“It is difficult to sort out authentic products from imitations, for which even the warranties turned out to be counterfeit.”

Ashley Song (

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