Seoul Administrative Court Makes a Conservative Ruling on the Administrative Lawsuit between Facebook and Korea Communications Commission

Aug 26, 2019

During the first administrative litigation trial between Facebook and Korea Communications Commission (KCC), Seoul Administrative Court analyzed legal provisions strictly and ruled that it is not illegal for a foreign CP (Contents Provider) to ‘change internet access routes’.
ISP (Internet Service Provider) is in charge of maintaining the quality of its network while a CP has a right to change internet access routes. Seoul Administrative Court also saw that the amount of possible damage inflicted on consumers would not be huge even if Facebook had caused damage on them.
However, when Seoul Administrative Court’s ruling is looked at closely, the ruling is heavily affected by gaps in regulations and Seoul Administrative Court also acknowledged insufficient legislation several times. It is practically asking South Korean Government to resolve gaps in regulations.
Because it is now confirmed that foreign CPs can cause damage on South Korean consumers, it is likely that South Korean Government will accelerate the process of preparing possible measures.
◊Seoul Administrative Court makes a conservative ruling
The ruling from the first trial is seen as a ‘decision made by looking at principles conservatively’. Rather than displaying Seoul Administrative Court’s discretionary power, Seoul Administrative Court looked at legal provisions strictly and protected the interests of Facebook.
“We needed to be strict on analyzing and applying legal provisions and not make analogical interpretations so that Facebook would not be disadvantageous during the trial.” said Seoul Administrative Court.
Seoul Administrative Court acknowledged the fact that Facebook changed access routes and caused damage on consumers as a result.
According to Seoul Administrative Court’s ruling, Facebook’s response speed for SK Broadband and LG Uplus changed from 29 milliseconds to 130 milliseconds and 43 milliseconds to 105 milliseconds respectively after changing access routes.
SK Broadband’s Customer Center received 1,857 complaints during six months when its response speed had slowed down. It only received 31 complaints during six months prior to the six months when response speed was slow.
However, Seoul Administrative Court ruled that Facebook did not commit any crime by analyzing legal provisions strictly.
While KCC saw Facebook’s act of changing access routes as illegal according to Telecommunications Business Act that states that an act of limiting or stopping use of telecommunication services without any reasonable cause is illegal, Seoul Administrative Court ruled that Facebook changing access routes had not limited any use of telecommunication services while Facebook’s act had caused inconvenience for some consumers.
Seoul Administrative Court ruled that Facebook had not caused noticeable damage on consumers while stating the part of Telecommunications Business Act. It was difficult for Seoul Administrative Court to say that response speed of 130ms is significantly slow compared to standards of Cisco, ETSI (European Telecommunications Standards Institute), foreign scientific papers, and ITU (International Telecommunication Union).

Jin Seong-cheol, who is the section head of Korea Communications Commission’s Communication Market Investigation Section, is making his statement in front of Seoul Administrative Court on the 22nd.  Seoul Administrative Court (Head Judge Park Yang-joon) ruled that Korea Communications Commission needs to cancel its excessive administrative sanction levied on Facebook.  Staff Reporter Lee, Donggeun | <Jin Seong-cheol, who is the section head of Korea Communications Commission’s Communication Market Investigation Section, is making his statement in front of Seoul Administrative Court on the 22nd. Seoul Administrative Court (Head Judge Park Yang-joon) ruled that Korea Communications Commission needs to cancel its excessive administrative sanction levied on Facebook. Staff Reporter Lee, Donggeun |>

◊Seoul Administrative Court’s ruling contradicts with many realities
Even though Seoul Administrative Court’s ruling does not have any legal issue, it causes huge gaps with daily life and the reality of industries in South Korea.
Seoul Administrative Court ruled that even though response speed had slowed down significantly due to Facebook, Facebook’s act had only caused inconvenience and did not limit use of telecommunication services. However, considering the fact that South Korea boasts the world’s fastest internet speed, such delay can be seen as a serious issue.
Consumers complained that they cannot see anything on Facebook and that they cannot play videos or look at pictures due to slow connection. These complaints indicate that there was significant number of people who could not access Facebook at all.
“ISPs have to face complaints even if the speed of their internet slows down little bit and they have to be responsible for it.” said a representative for an ISP. “It is a double standard when Facebook says that the current issue had only caused little bit of inconvenience.”
Fact that Seoul Administrative Court stated that consumers would not had to face inconvenience only if SK and LG Uplus have established sufficient amount of foreign network forces many to question whether Seoul Administrative Court thoroughly considered sharing of network investment cost issue, double-sided market concept, and network neutrality principle.
Seoul Administrative Court’s ruling ultimately means that a foreign CP does not have to establish a cache server in South Korea and that South Korea’s ISPs need to bring in every traffic from foreign servers.
Not only does this logic goes against a global access principle that states that a CP is responsible for asymmetrical traffic, but it also puts existence of internet network in South Korea in a dangerous situation because foreign CPs can use South Korean network for free even though they cause enormous amount of traffic. Based on double-sided market principle, a CP is also responsible for sharing the investment cost of network.
This logic also collides with network neutrality principle. According to South Korea’s network neutrality guideline and reasonable traffic management standard, ISPs need to resolve increased traffic by improving their network and CPs also need to put in efforts for fair and effective management and use of internet network.
“Just like Seoul Administrative Court acknowledged, Facebook had a right to change access routes and it had caused quality of our network.” said a representative for an ISP. “Fact that we need to be responsible for quality of our network when Facebook changed access routes and had gotten out of our control is a contradiction.”
◊Need for legislation that puts responsibility of maintaining the quality of network on global CPs
Seoul Administrative Court acknowledged limitations to South Korean laws and systems through its ruling.
“Internet users can freely share information and opinions through internet and such exchange is enhanced by CPs.” said Seoul Administrative Court. “We needed to take a careful approach when there is not clear regulation regarding a CP’s legal responsibility.”
“There needs to be a substantive enactment to regulate a CP that delays use of telecommunication services or causes inconvenience by changing access routes resulting in slower internet speed.” said Seoul Administrative Court regarding the need for legislation.
Regarding KCC’s sanction, Seoul Administrative Court reiterated the issue of incomplete legislation once again by stating that KCC did not prepare a clear method of its sanctions through additional legislation.
It is expected that there will be accelerated legislation process as it is confirmed that it will be hard to punish Facebook due to gaps within regulations even though South Korean consumers had suffered damage.
Three network quality maintenance-related bills motioned by Yoo Min-bong, Kim Kyung-jin, and Byeon Jae-il, who are members of the National Assembly, are currently pending within the National Assembly.
All three bills state certain standards and require CPs to be responsible for maintaining the quality of network when they exceed these standards. Yoo Min-bong regulates ‘an act of lowering the quality of a service’ without reasonable cause as a prohibited act.
As Seoul Administrative Court had shown a tendency of being conservative when it was analyzing legal provisions and terms, legislation process needs to include such issue.
Seoul Administrative Court clearly separated ‘limited use’ from ‘delay and inconvenience in use’. Also, it requested a clear standard when it comes to an ‘act that clearly damages one’s interests’. There needs to be a standard that clearly defines on what level of response speed does one’s interests are clearly damaged.
Staff Reporter Kim, Yongjoo |

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