On March 2, 2018, the Cabinet approved and submitted to the Diet the Bill to Partially Amend the Consumer Contract Act ("CCA Amendment Bill").
The CCA Amendment Bill adds, among others, "solicitation by wrongfully exploiting social inexperience to create unease" to the list of acts of wrongful solicitation that constitute grounds for terminating a contract. The CCA Amendment Bill would also allow for the termination of a contract where a business makes a grossly negligent misrepresentation; currently, the Consumer Contract Act recognizes only willful misrepresentations. In addition, the CCA Amendment Bill includes as invalid contractual provisions having no effect: (i) provisions allowing businesses to terminate contracts if a consumer has a legal guardian; and (ii) provisions granting businesses the right to determine their own contractual liabilities. Furthermore, the CCA Amendment Bill obligates businesses to make an effort in information sharing and drafting of contractual provisions.
The CCA Amendment Bill is scheduled to come into force within one year from its promulgation and will not apply to consumer contracts entered into during that time. Since it is currently not uncommon for businesses to use the newly added wrongful contractual provisions, upon the enactment of the CCA Amendment Bill, businesses should, going forward, review their contractual provisions in light of the amendment and should ensure that their methods of solicitation are compliant.