South Korea is set to approve tougher penalties Tuesday against those who engage in hoarding of protective masks, as China's coronavirus outbreak has sparked a sharp rise in demand for such masks, officials said. 

Under the tougher penalties, a person who engages in hoarding of protective masks will face a prison sentence of a maximum two years or a maximum fine of 50 million won ($42,108), the Ministry of Economy and Finance said in a statement.

Such penalties will go into effect Wednesday, according to the ministry.

Earlier this week, Finance Minister Hong Nam-ki told reporters that there could not have been shortages without unfair business practices, such as hoarding. 

"The government will do the following to discourage market manipulation, particularly in the face mask market," Hong said.

Market manipulation of protective masks, such as price rigging, will be treated as administrative and criminal offenses, Hong said.

The new coronavirus, which was first detected in the Chinese city of Wuhan in mid-December last year, has killed more than 460 people and infected more than 20,000.

The supply of masks has not met demand in South Korea, with some industry watchers blaming Chinese tourists and merchants for going on a buying binge here to protect themselves from the coronavirus.

It is increasingly difficult to purchase masks with good filtering features either online or at brick-and-mortar stores and pharmacies.

Concerns about the spread of the virus have deepened, with South Korea having reported 16 cases of the new coronavirus so far. (Yonhap)