"Even the Airbnb I'm Going to?"... Mass Crackdown on 'Illegal Lodging Businesses'

Seoul, Busan, Jeju: 272 Cases Detected
Enforcement and Punishment Practically Difficult

Amid allegations that Moon Da-hye, daughter of former President Moon Jae-in, operated an 'illegal lodging business,' it has been confirmed that transactions of unreported and unauthorized accommodations are rampant, especially in major tourist areas.

According to the Seoul Metropolitan Government, Busan Metropolitan City, and Jeju Provincial Government on the 23rd, a total of 272 cases of illegal lodging businesses were detected from January to August this year. In Busan, the number of detected cases has surged more than sevenfold in three years. To evade crackdowns, operators contact customers via messengers or other non-face-to-face methods and only disclose room numbers just before check-in.

To legally operate shared accommodations, one must be registered under one of the following: lodging facilities according to the Public Health Control Act, foreigner tourist urban homestay or Hanok experience businesses under the Tourism Promotion Act, or rural homestay businesses under the Rural Development Act. However, lodging businesses cannot be operated in officetels, apartments, or houses.

Shared accommodations are limited to detached houses and multi-unit housing, but even in multi-unit housing, operation without residents' consent is prohibited. Operating accommodations without business registration can result in imprisonment for up to two years or a fine of up to 20 million KRW under Article 20 of the Public Health Control Act.

However, enforcement and punishment are difficult unless the accommodation owner admits to it or guests provide evidence such as payment records. A Haeundae District Office official stated, "When we respond to reports and visit the site, many claim they visited a friend's house rather than paying money arranged in advance with the owner," adding, "In reality, there are almost no cases where penalties are imposed after detection, and as far as I know, only users who report directly are punished."

Ultimately, there are calls for sanctions against platforms that enable transactions of illegal lodging businesses. Generally, accommodations can be registered without verifying whether a separate business registration has been filed.

An Airbnb representative said, "Recognizing the issue, from this month, we require submission of a business registration certificate for new listings," adding, "For already registered businesses, we are allowing a one-year grace period until October next year to submit the business registration certificate; if not submitted, the accommodation will be removed from the platform."