Renting accommodation on Airbnb, Booking.com etc. under the new Hospitality Industry Act
An analysis of short-term tourist accommodation, published on the MGRT website, showed that private rental accommodation on Airbnb in 2019 increased by as much as 3.8 times compared to 2015. In 2019, 9,728 properties were advertised on the platform, which generated a total of EUR 66.5 million in revenue for landlords. Those data (which refer only to the Airbnb platform, but do not include data from Booking.com and other similar platforms) suggest that this type of rental accommodation has long outgrown the original idea of the so-called sharing economy and poses stiff (unfair) competition to other types of tourist accommodation.
To counter the downside of this increase in tourist accommodation on housing policy, which is already facing a shortage of rental properties on the market, and to protect other tourist accommodation providers against unfair competition, the MGRT has drafted the Hospitality Industry Bill (“ZGos-1”).
The ZGos-1, which was until recently still at the public consultation stage, changes the conditions for renting accommodation short-term to tourists in their own or rented apartments or holiday homes. According to the Bill, only accommodation units with a maximum of 15 beds may be rented short-term to guests who will may not stay at the accommodation for more than 30 days at a time.
Prior to engaging in short-term real estate leasing activities, the accommodation provider (i.e. room-lessor, sole proprietor, association or legal entity) will have to file an application to register the accommodation in the Accommodation Establishments Register kept by AJPES, which must be accompanied by approval from the municipality and (in the cases presented below) also from (other) apartment owners to carry on the activity.
In addition to approval from the competent municipal authority, which the accommodation provider must obtain to carry on short-term property rentals, the Bill also makes provision for municipalities to adopt an act in which they can set period and/or area for permitted activities for two- or multi-apartment buildings. This will give municipalities a significant say over which areas and to what extent housing will be earmarked for tourist accommodation and what proportion for the local community.
An accommodation provider who rents out his own or a rented property short-term in a multi-apartment building will also have to obtain an appropriate share of permissions from other apartment owners. An accommodation provider who rents out a property for up to 90 days in total and offers guests up to 5 beds will have to obtain permission from at least 75% of all apartment owners in the building, including permission from all direct neighbors whose apartments (walls or ceilings) border his housing unit. An accommodation provider who rents out a property for 90 days or more or less than 90 days, but spread out throughout the year or offers guests more than 5 beds, must obtain permission from all apartment owners.
The Bill also regulates the advertising of short-term rentals through publicly available reservation systems. The accommodation provider must state the accommodation establishment identification number from the Accommodation Establishments Register (introduced under ZGos-1) when advertising the accommodation. On the other hand, the online reservation system (e.g. Booking.com) will be required to display the accommodation establishment identification number on any offer or when advertising the property on the online reservation system or marketing it in any other manner.
Author: Klavdija Kek, Senior Associate
