Yoga, Pilates businesses to adopt standard terms on refunds, closures

New standard terms and conditions are being introduced for yoga and Pilates businesses to protect consumers from unfair practices, including inflated prices masked as discounts and excessive cancellation fees. The Fair Trade Commission (FTC) announced on July 20 that it has established and distributed the 'Yoga and Pilates Standard Terms and Conditions.'

The initiative aims to improve the transaction order within the yoga and Pilates market and prevent consumer harm. The FTC conducted a survey of the market, analyzed major dispute types, and held five consultation sessions with businesses, consumers, and related organizations to gather input for the standard terms.

While the standard terms are not legally mandatory, they will serve as a benchmark for the FTC when assessing the fairness of contract terms. Previously, disputes frequently arose over the calculation of refunds when consumers sought to cancel contracts. This was particularly common when consumers who had received discounts for long-term pre-payments were charged based on the original price, resulting in significantly lower refunds.

To address this, the standard terms clarify that refunds should be calculated based on the actual amount paid, not the original price, with cancellation fees capped at 10% of the fee. The terms also provide distinct refund methods for services paid for by session versus by duration, allowing consumers to choose the most appropriate option.

Furthermore, to prevent situations where consumers lose their payments due to sudden business closures or suspensions, the new terms mandate that businesses must notify their members at least 14 days prior to any planned suspension or closure. This measure is intended to curb 'hit-and-run' incidents where businesses disappear after collecting payments.

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We have established standard terms and conditions for yoga and Pilates businesses to improve the transaction order and prevent consumer damage.