Tesla Accused of Selling FSD to Korean Owners Who Can't Legally Use It
Consumer group seeks KFTC order to stop marketing FSD for China-built Teslas, which comprise the majority of the fleet.
A South Korean consumer group is preparing to file a complaint with regulators, alleging that Tesla marketed its "Full Self-Driving" (FSD) software to customers whose vehicles cannot legally operate the feature. The Citizens United for Consumer Sovereignty plans to submit the complaint to the Korea Fair Trade Commission (KFTC) on Thursday, citing data indicating that 99% of Teslas sold in Korea last year fall into the ineligible category.
What Happened
The eligibility issue stems from manufacturing origins. Teslas imported from U.S. factories, such as the Model S, Model X, and Cybertruck, enter South Korea under the KORUS free trade agreement, which recognizes U.S. safety standards. These vehicles were the only ones to receive "FSD (Supervised)" when Tesla activated the feature in the country late last year. However, the majority of Tesla sales in Korea consist of Model 3 and Model Y units built at Giga Shanghai. Because there is no equivalent free trade agreement with China, these vehicles require specific Korean approval that FSD currently lacks.
Tesla Korea country manager Seo Young-deuk testified to lawmakers last month that FSD is functional on approximately 20% of Teslas registered in the country. Data provided by Tesla to the National Assembly reveals that more than 170,000 Shanghai-built vehicles have been sold in Korea since 2023, with sales of China-made cars growing more than fivefold between 2023 and 2025. The consumer group’s complaint highlights Tesla’s "coming soon" promotions and demo videos filmed on Korean roads, arguing that the company failed to clarify that the software would only work on a small fraction of the vehicles it was selling.
Why It Matters
The complaint alleges that Tesla generated substantial revenue by selling an expensive driver-assistance system to mass-market buyers who cannot use it. For years, Tesla charged Korean buyers a one-time fee of 9.043 million won (approximately $6,726) for FSD, before shifting to a 150,000 won ($112) monthly subscription in August. The group is requesting that the KFTC temporarily order Tesla to stop marketing FSD for ineligible cars, impose fines, and refer the case to state investigators.
Regulatory hurdles remain significant. Tesla only formally applied for certification from the transport ministry about two weeks after an October 8 parliamentary hearing where Seo admitted the company had never previously requested testing. The ministry has indicated that FSD does not comply with local safety rules, specifically the requirement that drivers keep their hands on the wheel. Current FSD versions allow hands-free operation as long as the cabin camera detects driver attention. Despite these issues, Tesla passed BMW this year to become Korea’s top imported car brand. Legal recourse has also been limited; a Seoul court recently dismissed a refund lawsuit from owners, attributing the lack of features to Korean regulations rather than Tesla’s actions.
The Bottom Line
The KFTC is already investigating Tesla’s FSD advertising and has received written responses from the company. Tesla did not respond to requests for comment regarding the new complaint. If the regulator agrees with the consumer group, Tesla could face penalties and restrictions on how it markets autonomous capabilities to South Korean buyers.
