South Korea has implemented a “complete overhaul” of its Hotel Rating System, implementing a single standardized process that measures both hotel service quality and guest satisfaction, including stricter penalties for hotel operators that overcharge.
The new system came into effect on 1 July and applies different evaluation criteria to 1-, 2- and 3-star hotels and 4- and 5-star hotels – despite being classified as a “single, integrated system”– utilizing a two-step evaluation. The first stage of the evaluation is a prior notice visit to the hotel by evaluators, including “materials submitted by the business operator”. However, the second visit – an “undercover evaluation” where evaluators stay overnight “to experience the actual services” – dictates the final ranking of the operation.
If operators are given a ranking lower than the ranking they are applying for, they can accept the grade or undergo a reevaluation. Conversely, if they are given a higher ranking, they can choose to be upgraded but only within their category: those applying for a 1-, 2- or 3-star evaluation cannot be automatically granted a 4- or 5-star evaluation “even if their evaluation results are higher.”
One key element of the change is a sharp increase in the point penalty for “establishments collecting unfair charges.” This comes after rampant price gouging, particularly evident during the recent concerts by K-pop group BTS in Busan, when hotel prices increased three- to four-fold.
The penalty for such activities has been increased to 30 points, from 10 points, and the difference between a 4-star and a 5-star hotel rating is just 100 points, with a penalty able to shift a hotel ranking down an entire grade.
The new evaluation also places higher priority on “safety and hygiene,” including “fire prevention and facility safety management standards,” as well as “indicators for guest protection.” Personal information protection criteria have also been adjusted, as well as “eco-friendly management” criteria.
Speaking of the changes, Kang Dong-jin, Director General of Tourism Policy at the Ministry of Culture, Sports and Tourism, stated, “This revision of the notice was pursued with a focus on reducing the burden on the hotel industry while more strongly guaranteeing the safety and convenience of the public.
“We hope that the new evaluation system will be stably established and serve as an opportunity to improve the quality of domestic hotel services.”
Also amongst the changes are new evaluation indicators for the medical tourism hotel industry, with the ministry aiming to “encourage the growth of specialized medical tourism accommodation by reflecting the unique demands of medical tourists in the newly established indicators,” including “medical linkage services and the provision of conveniences.”
Hotels in South Korea’s integrated resorts housing casinos have historically held 5-star rankings, particularly given their international brand affiliations and the quality demand of their gaming customers, making it unlikely that the new ranking system will have a drastic effect on their classification.
Given that South Korean casinos only allow foreign gamblers, with the sole exception of Kangwon Land in Gangwon Province, their non-gaming revenues – including hotel receipts – hold strong weight in their results.
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