Reasons for Proposal and Major Provisions

Under the current law, where a motor vehicle dealer intermediates the sale and purchase of a motor vehicle, he/she shall give written notice of the following matters to guarantee the right to know of used car buyers and to prevent property damage: details of an inspection of the performance and condition of the relevant motor vehicle, any registration of seizure and mortgage, and upon the buyer's request, details of the inspection or appraisal of the price of the relevant motor vehicle.

However, according to the Used Car Transaction Survey Results conducted by the Korea Consumer Agency, as much as 75% of consumers responded that “false cars/baits to sell and unclear used car price information” are the biggest problems in the domestic used car market, false cars/baits to sell are still causing significant damage to consumers in the used car market, and there was an incident where a consumer who purchased a used car by being deceived by false cars/baits to sell committed suicide, so it is necessary to prepare countermeasures.

Also, the current provisions, which require inspecting or appraising the price of a motor vehicle if a buyer wishes, make it difficult for consumers to know that there 

is a price inspection or appraisal system, and the gap between the time of performance inspection and the time when consumers want to inspect and appraise the price is large, so the price inspection and appraisal system set forth in the Automobile Management Act is not being activated.

Therefore, new provisions that oblige motor vehicle dealers to explain the car price inspection and appraisal system to buyers and that allow punishing motor vehicle dealers in violation of the duty of explanation to secure the effectiveness of this duty of explanation are newly inserted (Article 58 (1) 4 newly inserted).

Also, this amendment aims to prevent consumer damage caused by false cars/baits to sell and secure traffic safety by making it compulsory to publish not only vehicle history and seller information but also details of an inspection of the performance and condition, such as the structure/devices and flooding of the relevant motor vehicle, and information on the availability of vehicle price inspection and appraisal, and upon violating this, being punished by imprisonment for up to two years or a fine of up to 20 million won where a motor vehicle dealer advertises to sell a car through the Internet, etc. (Article 58 (1) 1, etc.)