Europe: As anticipated, the European Commission has adopted a proposal for regulation that is designed to “enhance transparency” and “help public authorities ensure the balanced development” of a sustainable tourism and short-term rental sector.
News of the Commission’s stance was rumoured at the back end of last week, and the proposed rules are designed to improve the collection and sharing of data from short-term rental accommodation hosts and online booking platforms. This includes enhancing the transparency around the identification and activity of hosts, and around the rules they have to comply with, which will ultimately facilitate the registration of hosts.
In addition, the European Commission aims to tackle illegal listings and the fragmentation in how online platforms share data. This will thereby contribute to a more sustainable tourism ecosystem and inform “effective and proportionate” local policies to address the challenges and opportunities related to the short-term rental sector, according to the Commission.
What the new requirements for short-term rental data-sharing entail
The new proposed framework has been set up to:
• “Harmonise” registration requirements for hosts and their short-term rental properties when introduced by national authorities: registration schemes will have to be fully on-line and user-friendly. A similar set of relevant information on the hosts and their properties, namely the “who”, “what” and “where”, should be required. When registering, hosts should receive a unique registration number.
• Clarify rules to ensure registration numbers are displayed and checked: online platforms will have to facilitate hosts to display registration numbers on their platforms. They will also have to randomly check whether hosts register and display the correct numbers. Public authorities will be able to suspend registration numbers and ask platforms to delist non-compliant hosts.
• Streamline data-sharing between online platforms and public authorities: online platforms will have to share data about the number of rented nights and of guests with public authorities, once a month, in an automated way. Lighter reporting possibilities are foreseen for small and micro platforms. Public authorities will be able to receive the data through national ‘single digital entry points’, which will support “well-targeted policy making”.
• Allow the reuse of data, in aggregate form: the data generated under the proposal will, in aggregate form, contribute to tourism statistics produced by Eurostat [the statistical agency of the European Union] and feed into the upcoming European data space for tourism.
• Establish an effective framework of implementation: the 27 member states of the European Union will monitor the implementation of the transparency framework and put in place the relevant penalties for non-compliance of the regulations.
The announcement by the European Commission comes nearly a year after reports emerged that it was consulting on regulating the short-term rental market across the bloc, with a single set of pan-European rules among the options being considered. A public consultation period on short-term rental accommodation services closed last December.
The draft proposal would be seen as a middle ground in placating short-term rental booking platforms that want to operate in compliance with local and national laws, and benefit tourists and hosts alike, as well as cities across the bloc of 27 countries that have long called for stricter regulations of such platforms, following reports of anti-social behaviour of guests in rental properties and claims that short-term rentals perpetuate a lack of affordable housing in certain local communities.
Two years ago, the European Commission [and Eurostat] stuck a landmark partnership with the four private collaborative economy platforms [Airbnb, Booking.com, Expedia Group, TripAdvisor] in March 2020, which gave public authorities in Europe access to independently published data on short-term rentals on the aforementioned platforms.
Last July, Eurostat released its first key data on the European short-term rental sector, and last month marked the first time that Eurostat had published monthly data on short-stay accommodation offered via online platforms referring to the current year.
Short-term rentals now represent about one quarter of all tourist accommodation in the EU and their number is increasing significantly, largely boosted by the platform economy. This is reflected in Eurostat’s findings that the number of bookings over the first half of 2022 has increased by 138 per cent compared with the same period in 2021.
However, there is still some distance to go for the Commission’s proposal, which will complement the existing Digital Services Act and rules of the Directive on administrative cooperation in the field of taxation [DAC7] to be passed into law.
First, the proposal will be discussed in view of adoption by the European Parliament and the EU Council, with all 27 member states having a two-year period to establish the necessary mechanisms for data exchanges.
How the industry reacted
Thierry Breton, European Commissioner for the internal market:
“Short-term rentals bring benefits to travellers and hosts, and generate value for the wider tourism ecosystem. For instance, they can bring visitors and new sources of income to areas without a well-established tourism infrastructure.
“However, local communities have also raised concerns about over-tourism or lack of affordable housing, especially in big cities and popular destinations.
“This is why, today, we are presenting a proposal for an EU Regulation to enhance transparency on short-term rentals. The new legislation will provide a streamlined, simple and effective framework for collecting and sharing data on short-term rentals.”
Georgina Browes, head of EU public policy at Airbnb:
“These proposals provide a framework for Airbnb to scale our collaborations with governments and make it easier for everyday Europeans to share their homes and follow the rules. We have long supported the EU’s work on new STR rules.
“By taking a more harmonised approach to regulation, industry and governments can better work together to improve access to data, boost transparency and address disproportionate local rules that undermine the single market and prevent European families from sharing their homes to boost their income.”
Eduardo Miranda, non-executive chairman of The European Holiday Home Association [EHHA]:
“Short-term rentals are an essential part of the fast-growing EU tourism economy which creates jobs and opportunities for EU citizens as well as micro-, small- and medium-sized enterprises.
“The EHHA members have throughout the years supported STR data-sharing with authorities, in order to facilitate evidence-based policymaking. We believe that a harmonised framework for data collection and reporting, based on fair and proportionate underlying local rules, will help address the current challenges the STRs are facing such as a fragmented regulatory landscape, lack of legal certainty and ineffective enforcement.
“We fully support the Commission’s efforts to create a framework for data collection and sharing which, in turn, would allow policymakers to design informed and proportionate local STR rules – rules which comply with the Services Directive,” he added.
The EHHA: “The EHHA looks forward to continuing to actively cooperate with policy makers on this proposal. The proposal provides a great opportunity to increase the transparency, improve the understanding of the STR ecosystem, and support fair, proportionate and evidence-based policies at all levels to the benefit of all stakeholders, i.e. hosts, travellers, industry and society at large.”
Marie Audren, director general of HOTREC [umbrella association of Hotels, Restaurants, Bars and Cafés and similar establishments in Europe]:
“The hospitality industry has long been calling for an EU Regulation that would address challenges brought forward by the STR accommodation phenomenon. Today, building upon the recently adopted Digital Services Act, the European Commission proposal represents a step in the right direction to ensure a fair, transparent, competitive and sustainable accommodation environment.”
This story will be updated on an ongoing basis as more industry reaction comes in.