European Commission Proposes EU Rules on Short-Term Rental Data

On 7 November 2022, the European Commission proposed a regulation for short-term rentals across the European Union: a common way to register hosts, and a duty on platforms to send booking data to public authorities every month.

The proposal capped no nights and banned no listings. It dealt with data. The Commission said the rules would improve how data from hosts and online platforms was collected and shared, and that the data would inform local policy. Reuters called it a light-touch approach.

Thierry Breton, the Commissioner for Internal Market, set out the balance in the Commission's press release: “Short-term accommodation rentals create benefits for hosts, tourists and the tourism ecosystem, but they shouldn’t be growing at the expense of local communities.”

What the proposal contained

• Registration. Where national authorities introduce a registration scheme, it would have to be fully online and user-friendly, and ask for a similar set of information on the host and the property. A host who completed it would receive a unique registration number.
• Display and checks. Platforms would have to let hosts display registration numbers, and check at random whether hosts had registered and were showing the correct numbers. Public authorities could suspend a registration number and ask platforms to delist hosts who did not comply.
• Monthly data. Platforms would have to send public authorities data on the number of rented nights and guests once a month, by automated means, through national single digital entry points. The Commission's question-and-answer paper added the registration number and the web address of each listing in the requesting authority's territory.
• Statistics. In aggregate form, the data would feed Eurostat's tourism statistics.
• Penalties. Member States would monitor the framework and set penalties for breaking it.

Small platforms were offered a lighter regime. Micro and small platforms that did not reach a monthly average of 2,500 hosts could share data quarterly and report by hand.

None of it was law yet. The proposal had to be discussed by the European Parliament and the Council. After adoption and entry into force, Member States would have a two-year period to set up the data exchanges. TechCrunch judged at the time that the earliest the system could be running was most likely 2026.

What it left to cities and countries

The Commission said plainly that the proposal would not affect the ability of public authorities to regulate short-term rentals. National and local authorities kept the power to write rules on health and safety, urban planning, security and taxation, provided they respected the principles of justification and proportionality in the EU Services Directive. Existing registration schemes could stay if they met the proposal's requirements, for instance that registration was possible online and each property received a unique number.

The data had limits too. An authority could request only what was relevant to it: a city could ask for data about its own city and would get none about hosts in another. Income was handled elsewhere. Under an EU directive on tax cooperation, known as DAC7, platforms would have to provide data on income from short-term rentals to tax authorities.

Why Brussels acted

The Commission's case rested on scale and on poor data. Short-term rentals represented about one quarter of all tourist accommodation in the EU, it said, and bookings over the first half of 2022 had increased by 138% compared with the same period in 2021. Authorities did not always receive reliable data, it said, because hosts did not systematically register properties and platforms did not always share data.

Reuters set out the politics. Tourist destinations such as Paris, Venice and Barcelona blamed Airbnb for making housing shortages worse by pushing out lower-income residents, while smaller towns and rural areas wanted to attract more tourists through online platforms. The proposal, Reuters reported, was an effort to tackle a patchwork of national laws while balancing the interests of cities and rural areas.

There was a precedent. TechCrunch reported that in March 2020 the Commission secured an agreement with Airbnb, Booking.com, Expedia Group and Tripadvisor to share some data so that the EU's statistical office could publish reports. Reuters described the new proposal as similar to a data-sharing agreement that Airbnb struck with Eurostat, the EU statistics office, two years earlier. Short Term Rentalz noted that Airbnb had already capped rental days on its own platform in Amsterdam (entire homes, 30 nights a year), London (90 days a year) and Paris (120 days a year).

How platforms, hotels and cities reacted

Almost everyone welcomed the text, for different reasons.

“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”, said Georgina Browes, Airbnb's head of EU public policy, in remarks carried by Reuters. She said a more harmonised approach could help address disproportionate local rules. Eduardo Miranda, non-executive chairman of the European Holiday Home Association, said the association fully supported a framework that would let policymakers design informed and proportionate local rules that comply with the Services Directive.

HOTREC, the European umbrella association of hotels, restaurants, bars and cafes, called the initiative an opportunity to level the playing field among accommodation providers, and its Director General, Marie Audren, called the proposal a step in the right direction. HOTREC's position paper of July 2022 had asked for a mandatory host registration system, mandatory data-sharing obligations and power for local authorities over market access for short-term rental hosts.

The big cities welcomed it and asked for more. A press statement of the European Cities Alliance on Short Term Rental, dated 11 November 2022 and marked as a final draft in the copy on the City of Krakow's website, was signed on behalf of the alliance by Amsterdam, Barcelona, Berlin, Brussels, Paris, Prague and Vienna. It called mandatory data sharing the most crucial part of the draft, and welcomed an end to discussions with platforms over whether data requests complied with GDPR standards.

The same statement listed points that it said might need clarification and improvement. The draft appeared to prescribe how cities run their registration or authorisation schemes, in particular how they verify property owners. “We believe it is not for the EU to regulate this process”, the cities wrote. They said the draft seemed to give Member States the main role in making platforms comply, that cross-border cooperation on enforcement was very weak in their experience, and that online advertisements breaking local rules should be treated as illegal content. Krakow, a member of the alliance, wrote on 21 November 2022 that the alliance was analysing the proposals and would define its position.

What it meant for hosts

In November 2022 nothing changed in a host's daily work. The text was a proposal, and the Commission's own timetable put two years between entry into force and working data exchanges. The direction was readable all the same.

• Registration was becoming the base layer. Where a country or city required it, the proposal would make it online, tie one number to each property and have the platform display and check that number.
• Activity would be visible. Nights, guests, the registration number and the listing's web address would reach public authorities every month, from the platform.
• Local rules stayed local. A host in Amsterdam, Barcelona or Paris still answered to that city, and the cities wanted their power to allow or forbid short-term rentals left untouched.
• Tax data ran on a separate track. The Commission pointed to DAC7, under which platforms would report rental income to tax authorities.

The Commission's promise to hosts was simpler and clearer rules on how to register, with the rules that applied to them published on national websites.

Sources

1. European Commission, Commission acts to promote transparency in the short-term rental sector to the benefit of all players (7 November 2022).
2. European Commission, Questions and Answers: New Rules on Short-term Accommodation Rentals (7 November 2022).
3. Reuters (via Euronews), EU wants Airbnb, rivals to share bookings data with authorities (7 November 2022).
4. TechCrunch, European Union lay outs data-sharing plan to boost transparency of P2P rentals (7 November 2022).
5. Short Term Rentalz, European Commission STR data-sharing proposal to “enhance transparency” (7 November 2022).
6. Short Term Rentalz, European Commission set to propose data-sharing rules for STR platforms (3 November 2022).
7. European Cities Alliance on Short Term Rental (published by the City of Krakow), European Cities Alliance on Short Term Rental welcome EU draft-regulation (11 November 2022).
8. HOTREC (via Journal des Palaces), HOTREC welcomes the EU regulation of short-term accommodation rentals (14 November 2022).
9. City of Krakow, Short-term tourist rentals – the European Commission’s position (21 November 2022).