"Chasing Profiteering Will Lead to Ruin" ••• 'K-Price Gouging' in Lodging and Taxis to Face Business Suspension

 Original article: EDaily

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Government announces anti-price gouging measures at National Tourism Strategy meeting
Triggered by soaring accommodation prices linked to BTS... President Lee Jae-myung calls it an "outdated and regressive practice"
No corrective orders or warnings... First violation: 5-day suspension for lodging, 30 days for taxis
Lodging sector to introduce a "voluntary advance rate-reporting system" with price caps

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Accommodation providers that unilaterally cancel existing reservations and resell rooms are higher prices, as well as taxis that charge unreasonably high fares, will face immediate business suspensions if caught. 




On the afternoon of the 25th, President Lee Jae-myung presided over an expanded National Tourism Strategy Meeting and announced comprehensive measures to eradicate price gouging. Following the surge in accommodation prices linked to the BTS concert in Busan and the growing controversy over so-called "K-price gouging," the president criticized the practices as "outdated and regressive," prompting the government to formulate sweeping countermeasures covering lodging, transportation, and food services. The goal is to prevent violations of consumer rights, damage to the national image, and declines in tourism competitiveness caused by unfair pricing. 
 

First, in the lodging sector, businesses caught engaging in price gouging—such as failing to post rate charts, displaying false information, or not adhering to listed prices—will face an immediate five-day suspension. A second offense will result in a 10-day suspension, and a third offense in a 20-day suspension. Currently, first-time offenders receive only corrective orders, followed by a seven-day suspension for the second violation and 15 days for the third. The government will also apply the same penalties to rural homestays and foreigner-only urban guesthouses, which previously faced only fines or fell into regulatory blind spots.

Accommodation providers in high-demand areas and periods—such as during BTS concerts or fireworks festivals—have long drawn criticism for excessive price hikes. In one case, a lodging facility in Busan that normally charged 68,000 won on weekdays raised its rate to 770,000 won during the BTS concert period in June.

The government plans to introduce a “voluntary advance rate-reporting system,” under which lodging businesses will independently set maximum rates based on peak and off-peak seasons and weekdays versus weekends, and report them to local governments at least once a year. These rates must be disclosed on booking platforms and official websites. Failure to report seasonal rates in advance, or charging more than the reported rates, will be treated as a violation of price-posting rules and punished with an immediate five-day suspension. Participation in government-supported events, such as accommodation sales festivals, will also be restricted.

Vice Minister Kang Gi-ryong of the Ministry of Economy and Finance stated, “These measures are intended to prevent a recurrence of the sharp price hikes seen in Busan ahead of the BTS concert.” He added, “We plan to establish the necessary legal framework in the first half of the year and sign agreements with organizations such as the Central Lodging Association.”

Penalties for taxis that overcharge foreign tourists unfamiliar with local prices will also be significantly strengthened. Currently, first-time offenders receive only a warning. Under the new rules, they will immediately face a 30-day suspension from driving. A second offense will result in a 60-day license suspension, double the current penalty.

In the case of Jeju Island, where complaints about peak-season rental car prices are rampant, the government plans to overhaul the pricing system. Due to the lack of regulations, the gap between peak and off-season rental rates reportedly reaches 90 percent. A car that can be rented for 39,000 won per day in the off-season may cost as much as 350,000 won in peak season. Vice Minister Kang explained that the government will introduce a maximum discount rate to lower peak-season prices and consider implementing a rental car rate-reporting system nationwide.

In addition, restaurants found guilty of price gouging will have their registrations as merchants for Onnuri Gift Certificates and Local Love Gift Certificates (local currency) revoked. For street vendors, the government will introduce a real-name registration system and mandate price displays.

 




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