SEOUL, KOREA - The Handset Distribution Structure Improvement Act, designed to prevent illegal mobile phone subsidies and enhance consumer benefits, will take effect from October 1, 2014.
The main purpose of the new law is to achieve transparency in mobile carriers’ subsidy practices, thereby enabling all mobile phone users to benefit from subsidies regardless of the type of their rate plans.
The law also aims to bring down the handset price by turning the handset market from oligopolistic competition led by Samsung Electronics and LG Electronics toward perfectly open competition that encompasses foreign brands.
Starting from October 1 when the act will take effect, mobile carriers are mandated to disclose factory prices, sales prices, and subsidies by each handset model through their website, while their agencies are required to provide customers with such information clearly and transparently.
Any discrimination in provision of subsidies will be considered illegal, regardless of rate plan type, age, and region.