Why does China prohibit foreigners from staying in 'low class ' hotels? Is there any other country that does this?

No law forbids it. The law is that you have to registered at the police station within 24h of arrival in any place in China. Hotel do this registration for you. The problem is that in some places, having foreigners staying is highly unusual. So whenever a hotel accept a foreigner, it will show in the gov system which may come and check the hotel.

Nobody wants officials checking his business so some hotels just refuse all foreigners. This is not only true for hotels. It is the same problem when you stay at friend’s. Some don’t want you to stay at their house or will tell you not to register because your presence can bring troubles.

Hotels even very ‘low-class’ that operate in places like downtown Shanghai will accept you because you are just one foreigner in a million and city gov of jingan or huangpu don’t give a d * * * about you.

This text was originally published in quora.