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Guaranteed Online Learning Makes Parents and Students More at Ease

Source:Department of Consumer Protection

Online learning has become more and more popular. To regulate the enterprise operators in authorizing consumers to access the designated websites for online learning, the Department of Consumer Protection, Executive Yuan (hereinafter referred to as the DCP) has already reviewed and approved “the mandatory or prohibitory provisions in the Standardized Contract for Online Learning” drafted by the Ministry of Economic Affairs (MOEA). The “Standardized Contract” shall be implemented soon after the MOEA promulgates it.

The key points to be regulated are as follows:

  1. Total preferential price shall be explicitly specified as the billing basis for the service:

The total preferential price that the enterprise operator offers to the consumer at the time of purchase shall be used to calculate the refund in proportion to the courses taken. It is the total preferential price, not the "original price", that both parties shall agree to be the base for calculating the refund so as to protect the interest of consumers. (Point 8 of mandatory provisions)

  1. The mechanism for consumers to file a plead against a loan repayment: (Point 9 of mandatory provisions; point 13 of prohibitory provisions)

(1) If the enterprise operator uses the consumer loan contract as a brokerage agreement

for the payment and if the enterprise operator cannot provide the service, the consumer can present the documents to apply for stopping paying the loan balance.

(2) If both parties terminate or cancel the contract, the consumer loan contract shall be

terminated or cancelled at the same time.

(3) The enterprise operator shall not transfer to the third party the consumer loan

contract (the right to request for contract price) signed between the enterprise and the consumer.

  1. Consumers may claim compensation or terminate the contract if the quality of service is defective: (Point 14 of mandatory provisions)

(1) If the quality of service is flawed, the consumer may claim for compensation.

(2) If a serious defect occurs for more than three times and is not corrected, the

consumer may request to terminate the contract and claim a refund with penalty.

  1. It is clearly stipulated that the enterprise operator shall bear the responsibility of performance guarantee: If the prepaid period of the authorized fee exceeds one year and the prepaid amount exceeds NT$50,000, the enterprise operator shall provide an escrow account in such mechanisms as trust, financial institution, mutual guarantee of the same trade or joint guarantee of the guild. (Point 15 of mandatory provisions)
  2. Explicit regulation on termination of contract and refund policy: (Point 18 of mandatory provisions)

(1) The consumer may notify to terminate the contract at any time.

(2) Both parties may agree to settle the refund according to the proportion of services

provided or to return a fixed amount regularly (step-variable refund).

  1. It is clearly stipulated that the enterprise operator shall neither set the expiry date for the prepaid purchase points or the number of classes the consumer can attend and nor shall the enterprise operator extend the contract by means of automatic renewal and deductions. (Points 11 and 12 of prohibitory provisions)

The DCP reminds consumers that before signing a contract, they shall not only sit in on a class or preview the text books to see whether the services meet their own needs, but must also review the contents of the contract and the refunding terms to see whether or not they comply with the mandatory or prohibitory provisions in the Standardized Contract for Online Learning. If there is any incompliance, they shall ask the service provider to modify the contents or refuse to sign the contract so as to protect their own rights and interests.

The DCP also calls for the service providers of online learning to ensure that the contents of their service contract comply with the "the mandatory or prohibitory provisions in the Standardized Contract for Online Learning". If they fail to meet the requirements and do not revise the contents within a prescribed time limit, the competent authority may impose penalties in accordance with Article 56 (1) of the Consumer Protection Act.