A travel agency in Shangri-La county of the Diqing Tibetan Autonomous Prefecture, Yunnan Province, was seriously punished for forcing customers to pay for off-contract programs, while the country tries to regulate such misconduct with the new Tourism Law, which came into effect on October 1.

The misconduct was exposed by an investigative program by the China Central Television Sunday. Footages showed that a tour guide asked tourists who refused to pay 100 yuan ($16.34) for a visit to a local Tibetan household en route to Shangri-La to get off the bus, and a local official with the prefecture's tourism bureau threatened to take the tourists into custody if they continued to file complaints.

The prefecture's publicity department announced on Sunday that the incident took place on August 14. The license of the tour guide was revoked and his employer fined 100,000 yuan ($16,336) with a one-month business suspension on August 19.

The tourism official was transferred to another department. However, Net users questioned why he was not punished for shielding the acts.

The dispute triggered discussion towards the efficacy of the new law after the National Day holiday came to an end on Monday.

Liu Simin, a research fellow with the Tourism Research Center of the Chinese Academy of Social Sciences, told the Global Times that the law is so far effective in attacking illegal tourism charges as much fewer complaints had been reported.

According to the law, tourists are entitled to reject any forced shopping activities and travel agencies cannot obtain improper benefits by organizing purchases or self-paid programs beyond the contract. It also forbids tour guides from charging tips and conducting any forced sales.

An anonymous tour guide told the Global Times that it is a hidden rule for tour guides to take commissions from forced shopping or extra programs to subsidize their overly low charges for a travel package.

As agencies can no longer make profits this way under the new law, they have to set higher prices for the package by adding the previously hidden costs onto the price tag, Liu said. He has observed a 60 percent increase in tour expenses for overseas trips and a 33 percent increase for domestic ones.

"It has been a long-standing issue that travel agencies wage price wars, instead of competing more rationally on their products and services. Customers need to recognize the value of the service behind the price," Ge Lei, marketing general manager of China CYTS Tours Holding Co, told the Global Times, adding that the increased price would restrain the travel demand for a while, but the law is beneficial to guide the whole industry.