Fitness-center chains will be required to set aside a portion of member fees to safeguard consumers' rights if new regulations are passed by the government -- rules that might hinder gym owners from rapid expansion.
The regulations, expected to be passed next month, are the government's first official response to the financial troubles and closure of the Youth Camp Health Group's (
Youth Camp, Taiwan's first fitness-center chain, has debts of NT$1.3 billion (US$42 million). The opening of the firm's premium Taipei 101 Oxy Gym was the main reason behind its financial woes, company chairwoman Pure Tsai (
As Youth Camp is incapable of refunding membership fees, the Consumers' Foundation (
Under the Bankruptcy Law (
"We don't know how long it will take and how much each creditor can get. But it is better than doing nothing," Terry Huang (
Huang's remarks pinpointed the lack of regulations to protect consumers. To rectify this, the government has decided to implement tighter restrictions.
Hwang Horng-chyuan (黃宏全), director of the legal affairs department of the Consumer Protection Commission, said that when gym members pay more than NT$50,000 for a membership of more than one year, gym operators will have to set aside the additional amount as reserves.
"Business owners can either work with financial institutions or place the required amount in trust in accordance with the Trust Law (信託法)," Hwang said at a press conference.
Once the new regulations are approved next month, they should take effect in August, at the latest, as part of Article 17 of the Consumer Protection Law (
Candy Tang (唐雅君), director general of the Taipei Health Fitness Industry Association (台北市健身房公會), said the association has worked for nearly three years to reach a consensus with the commission so it can "facilitate healthy, carefree and high-quality developments for gym-goers."
Tang is also chair of Alexander Health Club (亞力山大俱樂部), the nation's biggest fitness-center chain.
"We have met with difficulties during discussions with other professional gym operators. But now that a consensus has been reached, I think this is actually good for the whole industry," she said.
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