The Fair Trade Commission corrected unfair terms and conditions that had been routinely used by sports facility businesses, such as banning refunds for memberships purchased at a discount.
The Fair Trade Commission said on Oct. 19 that it reviewed the contract terms of 20 companies operating chain-type gyms, Pilates, and yoga studios and corrected unfair terms, including refund bans and excessive usage fees.
The most representative unfair practice was a clause refusing refunds. Some companies stipulated that memberships sold at event prices or transferred memberships were nonrefundable. However, under relevant laws, consumers have the right to terminate contracts for memberships concluded through promotions or for transferred memberships.
Some companies charged excessive usage fees when a contract was terminated. They charged a full month's fee even if used for a single day, or deducted separate card processing fees in addition to a penalty when refunding after card payment. However, under the continuous transaction notice pursuant to the Sports Facilities Act and the Door-to-Door Sales Act, a penalty of up to 10% of the total contract price may be imposed in the event of midterm termination for reasons attributable to the consumer.
The Fair Trade Commission also took corrective action against companies that specified in their contracts a disclaimer stating, "Under no circumstances are we responsible for injuries occurring during personal exercise or for loss of personal belongings." Under the Civil Act, a business operator is liable for damages when causing harm to others through unlawful acts due to intent or negligence.
Through this measure, the Fair Trade Commission corrected all unfair terms of the companies in question and made it possible to terminate contracts and receive refunds regardless of membership type. It also deleted provisions deducting excessive usage fees upon midterm termination and revised the terms so that injuries or losses occurring during personal exercise are the responsibility of the business operator within the scope of its fault.