The European Commission has presented proposed rules for short-term rental platforms aimed at increasing transparency and mandatory data sharing – in what appears to be a “do it soft” approach to address concerns about the rise of holiday rentals on platforms such as Airbnb.
While p2p vacation rental platforms remain popular options for European citizens taking city breaks, they also continue to face opposition from residents of highly touristic cities for increasing housing costs.
EU executive has been considering how to tackle this popular but often controversial sector for some time – consultation opens last fall for a Short-Term Rental (STR) initiative, which said it wants to develop “responsible, fair and reliable growth in short-term rentals as part of a well-balanced tourism ecosystem”.
The result is today’s proposal focused on regulating the sharing of data by short-term rental platforms – an area it has previously focused on, securing an agreement with a number of major platforms (Airbnb, Booking.com, Expedia Group and Tripadvisor) through March 2020 to share some data so that the statistical office of the block can publish reports.
Today, the new proposal is said to aim to improve the transparency of the p2p rental sector with the same aim of helping public authorities to “ensure their balanced development as part of a sustainable tourism sector”.
“The new rules will improve the collection and sharing of data by hosts and online platforms. This in turn will contribute to effective and proportionate local policies to address the challenges and opportunities associated with the short-term rental sector,” the Commission suggests in press release.
According to an official Questions and Answers In the proposal, the package aims to harmonize the registration process for hosts and properties to generate a common set of data to support public authorities when they set short-term rental policies and make decisions about service provision.
The data that p2p rental platforms will have to share under the proposal includes:
- Stay and Guest Data;
- The registration number; and
- The web address (URL) of the short-term rental listings located on the territory of the requesting public authority.
“This information will enable the identification of unregistered listings and help enforce the registration obligation, further increasing transparency,” the Commission said.
The proposal would not affect the ability of public authorities to set their own local rules for short-term letting, according to the Commission, suggesting that public authorities would “simply need to adapt their registration system”. (Or set one up if it doesn’t currently work with one.)
Registration systems will also need to be fully online and “user-friendly”, and require a similar set of relevant information about hosts and their properties. Once completed, the host will receive a unique registration number.
“The proposal fully respects the principle of subsidiarity and the competences of public authorities,” he added, stressing that national and local authorities “retain the power to make rules and policies on short-term rentals to deal with, for example, health and safety, urban planning, security and tax matters” – as long as any rules they set out comply with the principles of reasonableness and proportionality enshrined in EU Services Directive.
He also notes that other rules – such as inbound Digital Services Act — may still apply to p2p rental platforms.
“The data collected on the basis of this proposal should allow public authorities to better assess the situation on the ground and create more targeted and proportionate rules,” he added.
The commission said other components of the framework would aim to:
• Clarify rules to ensure license plates are displayed and verified: requiring online platforms to make it easier for hosts to display registration numbers on their platforms and to conduct random checks that hosts are registering and displaying the correct numbers, while public authorities will be able to suspend registration numbers and require platforms to remove non-compliant hosts
• Streamline data sharing between online platforms and public authorities: online platforms will be required to share data on the number of nights rented and guests with public authorities once a month “in an automated way” — with lighter reporting “options” provided for small and micro-platforms (the Commission proposes those that do not reach a monthly average of 2,500 hosts, they may only need to share data quarterly, with no requirement to automate reporting) — and public authorities can receive this data through national “digital single points of entry”
• Allow reuse of data in aggregate form: the data generated under the proposal will “in aggregated form” feed tourism statistics produced by Eurostat and feed into the upcoming European Tourism Data Space. “This information will support the development of innovative tourism-related services,” the Commission suggests
• Create an effective implementation framework: Member States will be required to monitor the implementation of the transparency framework and introduce “appropriate sanctions” for non-compliance
Commenting in a statement, Commission Executive Vice-President Margrethe Vestager added:
“The short-term rental sector has been boosted by the platform economy, but has not developed with sufficient transparency. With this proposal, we make it easier for hosts and platforms, big or small, to contribute to greater transparency in the sector. These sector-specific rules will complement the general rules of the Digital Services Act, which establish a set of obligations and accountability requirements for platforms operating in the EU.”
The European Parliament and the Council will have to assess the proposal before it is adopted, but the Commission has foreseen a two-year implementation period after adoption and entry into force for platforms to adapt their systems for the necessary data sharing. So the earliest it could start working is most likely 2026.