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Photo: Fair Trade Commission |
[Alpha Biz= Kim Jisun] SEOUL, Oct. 19 — South Korea’s Fair Trade Commission (KFTC) announced on Saturday that it has uncovered and ordered corrections to multiple unfair contract clauses used by major fitness and wellness franchise operators, including gyms, Pilates, and yoga studios.
The investigation covered 20 franchise-type fitness companies (16 gyms, 2 Pilates studios, and 2 yoga centers) that had a high number of consumer complaints in the past four years. The KFTC identified four types of unfair terms, many of which restricted or denied refunds to members who wished to terminate contracts early.
Among the violations, 14 companies included clauses stating that memberships purchased under promotional or event prices were non-refundable, or that refunds would not be granted due to personal circumstances or changes of mind.
However, under Korean law, consumers are entitled to a “statutory right of cancellation”, allowing them to terminate their contract at any time during the contract period. Fitness service agreements are typically governed by the Door-to-Door Sales Act, which protects consumers from unfair business practices.
“Completely blocking refunds constitutes an unfair contract clause,”
the KFTC stated, adding that such provisions must be immediately revised or removed.
The regulator also targeted excessive penalty clauses, including terms that counted even a single day of usage as a full month or imposed cancellation fees exceeding the legal limit. By law, mid-term termination fees for personal reasons cannot exceed 10% of the total contract value, and deductions must reflect only the actual number of days used.
Some fitness centers were also found to deduct credit card transaction fees from refunds, which the KFTC said unfairly discriminated against customers paying by card compared to those paying in cash.
Additionally, the KFTC ordered revisions to liability waiver clauses stating that the business “assumes no responsibility under any circumstances” for injuries or theft occurring on the premises. The commission emphasized that operators remain liable if an incident occurs due to their negligence or fault, even if the customer was partially at fault.
The KFTC said it will continue monitoring membership-based service industries, including fitness, beauty, and education, to prevent similar unfair practices that undermine consumer rights.
알파경제 Kim Jisun (stockmk2020@alphabiz.co.kr)
