Korea Fair Trade Commission to take legal action against Airbnb over strict cancellation policy

Korea Fair Trade Commission (KFTC) said in a statement it is filing a lawsuit against Airbnb for not complying with a corrective order from November 2016 to amend or delete the company’s clause barring refunds within 60 days of consultation with KFTC. The case is historic for the nation’s anti-trust watchdog as it is the first against a foreign business operator due to the failure of abiding by a corrective order.

The company’s refund clause requires users to pay a penalty of 50% if they cancel a reservation more than seven days before check-on. Airbnb service fees are not refunded even if the booking is cancelled. KFTC said Airbnb did not reflect the discussions between the two and changed those provisions unilaterally. “The illegality that KFTC has pointed out in the corrective order is still not reserved,” the regulator added.

KFTC also said “Airbnb has not changed its former terms but made it appear to Korean consumers as if they had done so,” claiming that some terms and conditions have been changed but only to Korean guests and for those that the host has agreed to. Airbnb struck back at KFTC’s claim, saying it completed revising the policies in accordance with the Korean regulator’s corrective order.

Source: Korea Fair Trade Commission 2017.9.28 Press Release