South Korea Cracks Down on 'Fly-by-Night' Yoga and Pilates Studios with New Rules

Consumers seeking yoga and Pilates memberships in South Korea will now have greater protection against sudden studio closures, thanks to new guidelines from the Fair Trade Commission (FTC). The FTC has established a standard contract aimed at preventing 'fly-by-night' operators who take long-term payments and then disappear, leaving members without refunds. Under the new framework, studios must provide members with a two-week notice period before suspending or ceasing operations. This measure aims to give consumers ample time to seek refunds or make alternative arrangements. Furthermore, the standard contract stipulates that cancellation fees for unused portions of memberships will be capped at 10% of the total fee. While these standard contracts are not mandatory, they serve as a crucial guideline for the industry. The FTC's move comes after a significant number of consumer complaints, with the Korea Consumer Agency reporting that 9.9% of Pilates members and 11.5% of yoga members had lost their fees due to studio closures, averaging 250,000 won per person. Yoga and Pilates have been identified as sectors where long-term upfront payments are common, often with discounts, but they have fallen into a regulatory blind spot as they are not classified under the current sports facility laws, leading to recurrent consumer harm.

“

The standard contract includes notifying members two weeks in advance of suspension or closure and capping cancellation fees at 10% of the membership fee for unused portions.