Hello, this is attorney Lee Young-kyung of Cheongchul Law Firm.

The Korea Fair Trade Commission (KFTC) has announced that the amended Notice on the Operation of Substantiation of Labeling and Advertising Content (표시·광고 내용의 실증에 관한 운영 고시, hereinafter the ‘Substantiation Notice’) takes effect on 3 September 2026. The amendment was finalized after a public notice of the proposed rule in June, and the title of the Notice was changed from the former ‘Operation of Substantiation of Labeling and Advertising’ to ‘Operation of Substantiation of Labeling and Advertising Content’. At its core, the amendment clarifies the duty to substantiate performance claims for AI and other new-technology products, specifies the grounds for extending the deadline to submit substantiation materials, and shortens the maximum extension from 30 days to 15 days.

Cheongchul Law Firm is made up of attorneys specializing in the Fair Trade Act and the Labeling and Advertising Act, with experience both representing the KFTC and having the legality of its dispositions upheld in court, and representing numerous companies in KFTC investigations and hearings and in labeling and advertising compliance advice. Drawing on this experience on both sides, we summarize the amendment from a practical perspective. This column is based on the KFTC press release dated 2 September 2026.

The Amendment at a Glance – Clear Substantiation Duty for AI Advertising and a 15-Day Submission Deadline

The amendment to the Substantiation Notice has three key points. First, it makes clear that prior substantiation is required even when advertising the fact that AI or other new technology has been used. Second, it specifies the grounds for extending the submission period for substantiation materials by applying the grounds in Article 76 of the Enforcement Decree of the Monopoly Regulation and Fair Trade Act (독점규제 및 공정거래에 관한 법률 시행령 제76조), and shortens the maximum extension from the former 30 days to 15 days. Third, it makes clear that a cease order on labeling or advertising may be issued where a business continues advertising without submitting substantiation materials within the submission period, including any extension, and introduces a checklist that businesses can use to audit themselves.

● Effective date: 3 September 2026 (public notice of the proposed rule in June 2026 → final confirmation and entry into force)

● Change of title: ‘Operation of Substantiation of Labeling and Advertising’ → ‘Operation of Substantiation of Labeling and Advertising Content’

● Three key changes: ① clarified substantiation duty for AI and new technology ② specified extension grounds and shortened extension period (30 days → 15 days) ③ clarified basis for cease orders upon non-submission

● Governing law: Act on Fair Labeling and Advertising Article 5 (substantiation subject and methods, etc.) and Article 20 (administrative fines) (표시광고법 제5조, 제20조)

● Sanctions: administrative fine of up to KRW 100 million for failing to submit substantiation materials or violating a cease order

1. Background – The Substantiation Regime and Changes in the AI Market

The labeling and advertising substantiation regime requires businesses to have reasonable grounds for the ‘facts’ they assert in labeling and advertising, so that whether labeling or advertising is unfair can be determined promptly and objectively. The Substantiation Notice has set out detailed standards for operating this regime, including requests for, review of and handling of substantiation materials. To improve the effectiveness of the Notice and systematically overhaul its procedures and standards, the KFTC pursued this amendment focusing on ① changing the title of the Notice, ② clarifying what may be subject to a request for substantiation materials, ③ specifying the procedure for submitting substantiation materials, and ④ refining the standards for evaluating substantiation materials and supporting self-audits by businesses. In particular, the key background to this amendment is a market environment in which products and services emphasizing AI performance are continuously being released, together with the types of expressions found problematic in accumulated KFTC decisions.

2. Key Amendments

Clarified Substantiation Duty for AI and New-Technology Advertising and Expanded Examples of Expressions

The amendment makes clear that prior substantiation is required even when advertising the fact that AI or other new technology has been used. In addition, reflecting past KFTC decisions, expressions such as ‘improves concentration and memory’, ‘ingredients harmless to the human body’ and ‘down ○○%, feathers ○○%’ for down products were added as examples of expressions for which substantiation is particularly important, being expressions that materially affect the human body, safety, performance, efficacy, quality and consumers’ purchasing decisions.

Specified Grounds for Extending the Submission Period for Substantiation Materials

Previously, the phrase ‘force majeure such as natural disasters’ was vague, and cases of delayed submission occurred from time to time. By applying the grounds in Article 76 (Application for Postponement of Investigation, etc.) of the Enforcement Decree of the Monopoly Regulation and Fair Trade Act (공정거래법 시행령 제76조), the amendment specifies the extension grounds as ① natural disasters, ② mergers or acquisitions, commencement of rehabilitation proceedings, bankruptcy or similar proceedings, ③ seizure or temporary custody of books or evidentiary documents by a competent authority, and ④ serious disruption of business operations due to fire or disaster.

Shortened Maximum Extension – From 30 Days to 15 Days

So that the principle of ‘substantiate first, advertise later’ is observed more faithfully, the extension period was shortened from the former ‘30 days from the date the ground for extension ceases’ to ‘within 15 days’. As a result, it is now clear that the submission period for substantiation materials is 15 days in principle and, even where exceptionally extended, does not exceed 15 days.

Clarified Basis for Cease Orders on Labeling and Advertising upon Non-Submission

Where a business continues labeling or advertising without submitting substantiation materials within the submission period, including any extension, the KFTC may, in principle, order the business to cease the advertising in question. This makes clear that a business wishing to actively promote its products must have substantiable materials in place in advance.

New Self-Audit Checklist for Businesses

A checklist was prepared so that businesses can easily understand the principle that ‘the advertised facts must be proven’ and check the substantiation methods and evaluation standards themselves. The checklist consists of a stage before labeling or advertising, confirming whether the claim is subject to substantiation, whether substantiation materials have been secured and the evaluation standards for each type of material, and a stage after receiving a request to submit substantiation materials, confirming the submission period, extension requirements, submission method and sanctions for non-submission.

3. Relevant Law – The Substantiation Regime under Article 5 and Administrative Fines under Article 20 of the Labeling and Advertising Act

The Substantiation Notice is a subordinate rule that details the operating standards for the substantiation regime established by Act on Fair Labeling and Advertising Article 5 (표시광고법 제5조).

4. Substantiation Response Checklist for Companies Advertising AI and New-Technology Products

Below is a summary of what marketing and legal staff at companies planning to advertise AI or new-technology products should check immediately.

5. Frequently Asked Questions from Those in Charge of Advertising AI and New-Technology Products (FAQ)

Q1. Do we need substantiation materials just for including the phrase ‘uses AI technology’?

Yes. The amendment expressly provides that prior substantiation is required even when advertising the fact that AI or other new technology has been used. Merely mentioning the use of a technology may also be treated as a ‘matter relating to facts’ and thus be subject to substantiation.

Q2. How long is the submission period for substantiation materials?

In principle, within 15 days from the date of receipt of the request. Only where there are justifiable grounds (natural disaster, merger, acquisition, rehabilitation or bankruptcy proceedings, seizure or custody of books or evidentiary documents, fire or disaster, etc., as set out in Article 76 of the Enforcement Decree) may the period be extended, and only up to 15 days from the date the ground ceases, shortened from the former 30 days.

Q3. What happens if we cannot submit substantiation materials within the deadline?

Where a business continues labeling or advertising without submitting substantiation materials within the submission period, including any extension, the KFTC may order the business to cease the advertising in question until the materials are submitted (Act on Fair Labeling and Advertising Article 5 (5), 표시광고법 제5조 제5항). In addition, an administrative fine of up to KRW 100 million may be imposed for failing to submit substantiation materials or violating a cease order (Article 20 (2) of the same Act, 같은 법 제20조 제2항).

Q4. For which expressions should we prepare substantiation materials particularly thoroughly?

Alongside expressions relating to the human body, safety, performance, efficacy and quality, such as ‘improves concentration and memory’, ‘ingredients harmless to the human body’ and ‘down ○○%, feathers ○○%’ for down products, which were added as examples in this amendment based on KFTC decisions, expressions emphasizing the use of new AI technology are a representative type for which substantiation is particularly important. If you plan to use such expressions in advertising, you must have objective and reasonable substantiation materials in place beforehand.

Q5. How should we use the business checklist prepared by the KFTC?

The checklist consists of [Stage 1] confirming, before labeling or advertising, whether the claim is subject to substantiation, whether substantiation materials have been secured and the evaluation standards for each type of material, and [Stage 2] confirming, after receiving a request to submit substantiation materials, the submission period, extension requirements, submission method and sanctions for non-submission. Using the checklist at both the advertising planning stage and the KFTC response stage can effectively prevent the risk of violating the Labeling and Advertising Act.

6. Substantiation and Advertising Risk Advice from Cheongchul Law Firm, Specialists in Fair Trade and Advertising Law

Cheongchul Law Firm is made up of attorneys specializing in fair trade and labeling and advertising law, with experience in advertising and consumer-related fields such as the Fair Trade Act, the Labeling and Advertising Act and the E-Commerce Act, both representing the KFTC and having the legality of its dispositions upheld in court, and representing numerous companies in responding to KFTC investigations and hearings and in litigation to revoke dispositions. Drawing on hands-on experience on both the regulator’s and companies’ sides, we support companies’ advertising and substantiation risk management through the services below.

With this amendment and entry into force of the Substantiation Notice, the prior substantiation duty for advertising that emphasizes AI or new technology has become much clearer, and the submission deadline for substantiation materials has been shortened to 15 days, making it more important than ever to build a rapid response system. Corporate staff who need prior review of advertising for AI or new-technology products, support in preparing and submitting substantiation materials, or a labeling and advertising compliance framework are welcome to contact Cheongchul Law Firm.