Online used car sales require owner's consent under new anti-fraud law

South Korea has implemented a new regulation, effective from June 3rd, requiring individuals to obtain prior consent from vehicle owners before listing their cars on online used car marketplaces. This measure, part of the amended Automobile Management Act and its enforcement decree, aims to curb the pervasive issue of fraudulent listings in the used car industry.

Previously, individuals could list vehicles on platforms like 'Carrot Market' without the owner's explicit permission. This loophole was often exploited to create fake listings, enticing potential buyers with non-existent deals and demanding advance payments, leading to widespread fraud. The Ministry of Land, Infrastructure and Transport highlighted these concerns as the basis for the new law.

To illustrate the problem, Yoon Jong-moon, a member of the Democratic Party, famously listed the then-Minister of Land, Infrastructure and Transport's official car on a used car platform during a 2024 parliamentary audit. This act drew a strong protest from the minister, emphasizing the severity of unauthorized listings.

Under the new law, individuals advertising a vehicle they do not own must secure the owner's explicit consent, which must then be clearly displayed on the platform. Platform operators are obligated to verify this consent. Failure to comply can result in fines of up to 500,000 won (approximately $360) for the lister and up to 10 million won (approximately $7,200) for the platform operator. Additionally, penalties of up to 1 million won will be imposed on dealers who omit crucial information, such as vehicle history or inspection records, from online listings. "This regulatory improvement is expected to reduce false and unauthorized advertisements in online used car transactions and contribute to the formation of a transparent used car market where consumers can trade with confidence," stated Park Jun-hyung, head of the Mobility Automobile Division at the Ministry of Land, Infrastructure and Transport.

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This regulatory improvement is expected to reduce false and unauthorized advertisements in online used car transactions and contribute to the formation of a transparent used car market where consumers can trade with confidence.