[Untangling Issues]② Only Foreigners Travel? Koreans Travel Too

Guests and operators of urban guesthouses in Songpa-gu.
Photo by Asia Economy DB

[Asia Economy Reporter Kim Jong-hwa] # Foreigner A, who wanted to experience Korean home culture, tried to use accommodation in downtown Seoul with a Korean guide and acquaintance. However, the Korean guide and acquaintance could not stay at the same accommodation as A and had to use a different lodging.

The accommodation A used was a 'dosiminbakjip' (urban homestay). According to the Tourism Promotion Act, which regulates the 'foreign tourist urban homestay business' created to allow foreigners to experience Korean home culture, only foreign customers are permitted to stay.

Started in December 2011, the 'foreign tourist urban homestay business' is a form of shared lodging where residents in urban areas provide lodging and meals using their own homes. Residents of detached houses, multi-family houses, or apartments under 230㎡ in urban areas can open a business if they have a system capable of guiding foreigners.

From 2012 to 2016, over five years, the number of businesses increased from 328 to 1,451 (342%), and the annual number of users per business rose from only 106 at the start to 848 (700%). Annual sales also surged from 6 million KRW to 30 million KRW (400%), leading many people to enter the urban homestay business. As of the end of last year, 2,049 businesses operate dosiminbakjip.

However, due to significant sales differences depending on the season, region (whether metropolitan or non-metropolitan), and peak or off-peak seasons for foreign tourists, it has become difficult to sustain the urban homestay business. In particular, when foreigners accompanied by Koreans stay only at urban homestays and Koreans have to use other nearby accommodations, dissatisfaction arose simultaneously among both foreigners and Koreans.

In response, the Small and Medium Business Ombudsman predicted that if regulations focus solely on Koreans, it would result in the proliferation of illegal operations not registered as foreign tourist urban homestays. This could threaten foreigners' safety and fail to prevent excessive commercialization of residential areas.

A Small and Medium Business Ombudsman official said, "Unrealistic regulations will consume more administrative resources for cracking down on illegal operations," emphasizing the need to amend related laws to allow limited accommodation for Koreans with some flexibility.

On the other hand, the Ministry of Culture, Sports and Tourism, the competent authority, takes a cautious stance because fully allowing professional lodging businesses in residential areas could cause concerns about residential environment damage and lead to reverse discrimination controversies with existing lodging businesses subject to various restrictions such as facility and hygiene standards under the Public Health Control Act.

How do other countries operate urban homestay businesses? In San Francisco, a major tourist city in the United States, domestic guests are allowed to stay without limits on business days if the homestay operator resides together. In Paris, France, if the homestay operator resides for eight months, they can host domestic guests for 120 days. Japan allows domestic stays for up to 180 days, and the UK allows up to 90 days.

The government decided last November to include this case in the regulatory sandbox and apply it from May 2020. Therefore, starting last month, for two years, accommodations within 1 km of Seoul subway stations can host both foreigners and Koreans for up to 180 days if the homestay operator resides permanently.

A Small and Medium Business Ombudsman official said, "Providing urban shared homestay opportunities to Koreans as well is expected to enhance tourism convenience and create new jobs," adding, "We will complete the revision of the Tourism Promotion Act by the end of this year to make the two-year temporary measure permanent."

This content was produced with the assistance of AI translation services.