Korea to adopt tougher penalties for overcharging in tourism sector

Tourists are seen with shopping bags in Myeong-dong, Seoul, Sunday. Yonhap

Korea plans to impose tougher penalties for overcharging in the accommodation and restaurant sectors starting next month as part of the government's efforts to promote tourism, the finance ministry said Tuesday.

The Cabinet approved revisions to the Enforcement Decree of the Tourism Promotion Act aimed at imposing heavier penalties for overcharging tourists, which will take effect Aug. 4, according to the Ministry of Finance and Economy.

Under the revision, operators of businesses offering stays in "hanok," traditional Korean houses, that fail to post or comply with price lists will face a five-day business suspension for a first violation, instead of receiving only a warning.

Foreign tourist home-stay businesses in urban areas, which previously had no requirements to post or comply with price lists, will also fall under the revised regulation.

The government earlier implemented similar revisions for general accommodation businesses in mid-July.

In addition to the business suspension for the first overcharging violation, second and third breaches will result in business suspensions of 10 days and 20 days, respectively, up from the previous seven days and 15 days.

Taxi drivers who overcharge passengers will immediately receive a 30-day license suspension, compared with the current rule of issuing only a warning for a first violation.

Drivers committing a second violation will have their licenses suspended for 60 days, while a third violation will result in their licenses being revoked.

The government will continue efforts to address unfair practices in the tourism industry, including introducing penalties for business operators' unilateral cancellation of reservations without valid grounds, the finance ministry added.