European Union lay outs data-sharing plan to boost transparency of p2p rentals

The European Commission has put forward proposed rules for short term rental platforms focused on boosting transparency and mandatory data-sharing — in what looks like a ‘softly does it’ approach to addressing concerns attached to the rise of vacation rentals on platforms like Airbnb.

While p2p vacation rental platforms remain popular options for European citizens taking city breaks, they also continue to face opposition from residents of heavily touristed cities for driving up housing costs.

The EU’s executive has been considering how to tackle this popular yet often controversy sector for some time — opening a consultation last fall for a short-term rental (STR) initiative that it said it wanted to develop “responsible, fair and trusted growth in short-term rentals, as part of a well-balanced tourist ecosystem”.

The upshot is a proposal today centered on regulating data-sharing 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) back in March 2020 to share some data so the bloc’s statistical office could publish reports.

Today it said the new proposal aims to enhance transparency of the p2p rentals sector with the same goal of helping public authorities “ensure their balanced development as part of a sustainable tourism sector”.

“The new rules will improve the collection and sharing of data from hosts and online platforms. This will, in turn, inform effective and proportionate local policies to address the challenges and opportunities related to the short-term rental sector,” the Commission suggested in a press release.

According to an official Q&A on the proposal, the package aims to harmonize the registration process for hosts and properties in order to generate a common set of data to support public authorities as they set policies for short term lets and make decisions about provisioning services.

The data that p2p rental platforms will be required to share under the proposal includes:

• Data on the number of stays and guests;
• The registration number; and
• The web address (URL) of the listings for short-term rentals located in the territory of the requesting public authority.

“This information would allow the identification of non-registered listings and help to enforce the registration obligation, further increasing transparency,” the Commission said.

The proposal will not affect the ability of public authorities to set their own local rules for short-term accommodation rentals, per the Commission, which suggests public authorities will “just need to adapt their registration system”. (Or set one up if they do not currently operate one.)

Registration systems will also have to be fully online and “user friendly”, as well as requiring a similar set of relevant info on hosts and their properties. Once completed, a host would receive a unique registration number.

“The proposal fully respects the principle of subsidiarity and the competences of public authorities,” it added, emphasizing that national and local authorities “retain the power to design rules and policies on short-term rentals, to deal, for instance, with health and safety issues, urban planning, security and taxation issues” — so long as any rules they set respect the principles of justification and proportionality enshrined in the EU Services Directive. 

It also notes that other rules — such as the incoming Digital Services Act — may still apply to p2p rentals platforms.

“The data collected on the basis of this proposal should allow public authorities to better assess the situation on the ground and make more targeted and proportionate rules,” it added.

The Commission said other components of the framework will aim to:

•  Clarify rules to ensure registration numbers are displayed and checked: with online platforms being required to facilitate hosts to display registration numbers on their platforms and conduct random checks on whether hosts register and display the correct numbers, while 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 be required to share data about the number of rented nights and of guests with public authorities, once a month, “in an automated way” — with lighter reporting “possibilities” foreseen for small and micro platforms (the Commission is suggesting those that do not hit a monthly average of 2,500 hosts might only need to share data quarterly, without a requirement to automate the reporting) — and public authorities able to receive this data through national “single digital entry points”

•  Allow the reuse of data, in aggregate form: the data generated under the proposal will, “in aggregate form”, feed tourism statistics produced by Eurostat and feed into the upcoming European data space for tourism. “This information will support the development of innovative, tourism-related services,” the Commission suggests

• Establish an effective framework of implementation: Member States will be required to monitor the implementation of the transparency framework and put in place “relevant penalties” for non-compliance with the obligations

Commenting in a statement, Commission EVP Margrethe Vestager, added:

“The short-term accommodation rental sector has been boosted by the platform economy but has not developed with sufficient transparency. With this proposal, we are making 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 Council will need to weigh in on the proposal before it’s adopted — but the Commission has envisaged 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 be up and running is, most likely, 2026.