Overcharging hotels risk losing star rating under new rules

A billboard displays a photo of BTS member V on the exterior of a hotel in Haeundae Beach, Busan, June 9. Yonhap

Hotels found to have overcharged customers could face a 30-point deduction in their rating evaluation, a penalty steep enough to cost a hotel its star rating. The move signals a tougher stance on price gouging, penalizing such offense three times more heavily than most other violations.

The Ministry of Culture, Sports and Tourism said Thursday that it had issued advance public notice of a proposed revision to the guidelines governing hotel grading operations.

Under the revised plan, tourist hotels face a new 30-point rating deduction for overcharging customers, compared with a 10-point deduction for most other violations, including hotel fires, illegal activity and administrative sanctions from sanitation or fire inspections.

With up to 1,000 points given under the rating system and only a 100-point gap five-star and four-star thresholds, overcharging violations could push a hotel below its rating tier.

The new criterion came after a price gouging controversy surrounding BTS' concerts in Busan, when many accommodations throughout the southern port city simultaneously raised their prices ahead of last week's shows.

Accommodation prices surged soon after the concert announcement, according to a January survey by the Korea Fair Trade Commission and the Korea Consumer Agency. The survey, based on rates from 135 properties, including 52 hotels, 39 motels and 44 vacation rentals listed on major booking platforms, found that the average one-night rate for the concert weekend was 433,999 won ($284), 2.4 times higher than the weekends before and after.

In May, President Lee Jae Myung also called for improvements, warning that repeated price gouging controversies during major events would severely damage Busan's image.

The revision also extends to guest room evaluation criteria, which were broken down further. Guest rooms will be scored on the variety of furniture, such as wardrobes, desks and sofas, as well as amenities such as bathrobes, slippers and minibars.

Bedding and bathroom standards were also spelled out in greater detail, covering specifics such as stains, ventilation and anti-slip flooring.

An evaluation system was also established for medical tourist hotels, which previously lacked separate rating criteria. Only two hotels nationwide were registered under the category as of last year, prompting repeated calls to revitalize the program since its introduction in 2014.

Korea's medical tourism industry is seeing record numbers. According to the Ministry of Health and Welfare, 2.01 million foreign patients visited the country last year, the highest since the country began compiling such data in 2009.