European Court of Justice advises Airbnb be seen as digital service provider

by | May 18, 2019 | News

The ruling gives the company the ability to operate freely across the European Union

The company, which is facing calls in France for greater regulation, is pleased with the legal opinion.

Airbnb recently had a victory in Europe, after the court of justice there ruled the company be considered a digital service provider.

Made by Maciej Szpunar, one of the European Court of Justice’s advocates general, the ruling essentially gives the digital travel company the ability to operate freely across the European Union. Szpunar found that Airbnb was what Brussels would consider an information society service.

This ruling came with a rejection for those who felt otherwise. A French tourism association had argued that Airbnb should face the same accounting, insurance and other financial obligations of traditional providers of real estate.

Arguments from both sides

Airbnb, which is registered in the EU nation of Ireland, argued that its commercial activities involve matching property owners with people who are looking for a place to stay, a role which falls outside of traditional real estate brokerage.

Part of the legal decision involved the way Airbnb’s assertion was challenged. Szpunar said the French government had not properly notified the European Commission as well as authorities in Ireland that it intended to apply French law to Airbnb.

Furthermore, he determined that Airbnb was an online service which connected potential guests with hosts for short-term stays, which was essentially what the company argued.

It was unclear whether a proper notification would have changed this judgement.

This decision’s aftermath

A natural next question is what happens now?

It’s important to note that this decision is non-binding, although the court takes the advice of its advocates general in 80% of cases. Airbnb, unsurprisingly, said it welcomed the opinion as a “clear overview of what rules apply.”

This decision could be a telling one. France is not the only market in which Airbnb has faced forces advocating for a crackdown on the way it operates.

Other cities in which Airbnb has caused civic issues include Amsterdam and Barcelona, both of which are also in the EU.

Challengers criticize the company for changing the face of the neighbourhoods in which it operates, basically removing their personalities and turning them primarily into locales for short-term guests and hordes of out-of-town tourists.

This ruling is already significant given that France is the company’s single largest market outside of the United States. Paris, meanwhile, is its biggest single city market, with 65,000 homes there listed on the site.

A spokesman for the company said: “We welcome the opinion of the advocate general, which provides a clear overview of what rules apply to collaborative economy platforms like Airbnb and how these rules help create opportunities for consumers.”

“We also want to be good partners and already we have worked with more than 500 governments around the world on measures to help hosts share their homes, follow the rules and pay their fair share of tax,” the spokeswoman went on to say.

“As we move forward, we want to continue working with everyone to put locals at the heart of sustainable 21st-century travel.”

 

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