What should you do if you face unfair practices by a retailer when buying the latest smartphone? If unwanted add-on services are signed up for, or the actual contract terms differ from what was explained during consultation, users can report it directly through a simple process and receive compensation.

As Samsung Electronics' new Galaxy Z8 series of foldable phones continues to set sales records, a reporting system aimed at providing relief for user harm caused by unfair activation practices is drawing attention.

On Wednesday, the Korea Communications Users Protection Association (KCUP) urged active use of a "user participation reporting system" and said it was strengthening guidance on the scheme with SK Telecom, KT and LG Uplus to establish fair distribution order.

The user participation reporting system allows users to report directly if the conditions they were told when signing up for mobile service differ from the actual contract and activation details, or if they suspect unfair sales practices.

Reportable cases include retailers failing to pay promised subsidies, enrolling users in unwanted plans or add-on services, and activations processed by a different retailer from the one where the consultation and application took place. False or exaggerated advertising that guides users to handset prices or support conditions that differ from reality through online channels, social media and open chat rooms can also be reported.

Reports must be filed by the actual contract user within 14 days, including the activation date. The process is simple. Users can submit evidence confirming the damage by accessing the "Mobile Phone Unfair Practices Reporting Center" website and providing materials such as the subscription contract, activation guidance text messages, consultation details, screenshots of online ads, and records of plan and add-on service subscriptions.

Only the subscriber can file a report. Proxy reports are not allowed, except when parents file on behalf of minor children.

If violations are finally confirmed based on the report and submitted materials, a compensation payment of 50,000 won is paid per report. Compensation is limited to once per person per quarter, and the maximum annual payout is 200,000 won.

The association said the process complements the previous "phone paparazzi" system. The Korea Communications Commission, now the Korea Communications and Media Commission, and other relevant authorities introduced a "report-and-reward system for excessive handset subsidy payments" in 2013, but suspended it in 2022 after excessive reporting competition among retailers and repeated cases of professional complainants taking reward money.

The new user participation reporting system addressed such side effects by placing limits on the compensation amount and the number of payouts. Users can receive compensation only when an investigation confirms a violation.

The three mobile carriers have also been informing users about the system through phone activation guidance text messages since early last month. The aim is to help users check actual contract details right after signing up and easily recognise the reporting system if they judge there is a problem.

A KCUP official said, "If you feel the conditions you were told during the mobile phone subscription process differ from the actual contract details, you can check whether it is reportable through the user participation reporting system." The official added, "We will continue to expand guidance so that users can use the reporting system more easily."