Travelers Beware: South Korea to Impose Heavy Penalties on Price Gouging and Overcharging Starting August

The South Korean government recently announced that, to enhance tourism service quality and promote sustainable tourism development, it will implement stricter administrative penalties starting next month for 'price gouging and overcharging' in accommodation and dining services. The State Council has officially approved amendments to the Enforcement Decree of the Tourism Promotion Act, strengthening penalties for businesses that overcharge or violate pricing disclosure rules. The new regulations are set to take effect on August 4.

First-time offenders without proper pricing displays or inflating room rates will face a 5-day business suspension. According to the revised decree cited by The JoongAng Ilbo, traditional hanok-stay guesthouse operators who fail to display price lists as required or charge prices different from those advertised will now face a mandatory 5-day suspension for first violations—up from previous written warnings.

Additionally, 'urban foreigner-targeted minbak' (short-term rentals), which previously lacked clear pricing and contract compliance rules, are now fully included in the regulatory scope. In addition to the initial 5-day suspension, repeat offenders will face longer penalties: second violations extend the suspension from 7 to 10 days, and third violations increase it from 15 to 20 days.

Taxi drivers caught overcharging tourists will face immediate 30-day license suspensions. The new rules also strengthen penalties for taxis, which have long been accused of overcharging foreign tourists. Previously, first-time offenders received only warnings. Under the new system, first violations result in a 30-day suspension of driving privileges; second violations lead to 60-day suspensions; and third violations result in full revocation of the driver’s license.

Meanwhile, areas like Cheonggyecheon in Seoul are seeing cherry blossoms in full bloom, attracting large numbers of visitors. (AP)

The Ministry of Strategy and Finance added that the government will continue cracking down on all unfair and illegal practices in the tourism sector. The next step includes introducing penalties for booking platforms or hotels that 'unilaterally cancel customer reservations' without valid reasons, aiming to fully protect foreign tourists’ rights and encourage more international visitors to spend in Korea.