The Malta Independent 17 June 2024, Monday
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Regulating the short-term rentals sector for the benefit of all

Josianne Cutajar Sunday, 26 March 2023, 08:41 Last update: about 2 years ago

Last week I delivered a keynote speech in an event organised by the Malta Business Bureau and the European Parliament Liaison Office in Valletta, where short-term rentals and the upcoming EU legislation were discussed. I did so in my capacity as rapporteur for the Transport and Tourism Committee’s opinion with regard to the European Commission’s Proposal for a Regulation on data collection and sharing relating to short-term accommodation rental services (STR).

During the event, I highlighted the importance of this piece of legislation, which is long overdue; a legislative proposal that continues to unlock the digital touristic economy in Europe and that should bring benefits to all actors, which are part of the tourism ecosystem. I emphasised that renting out short-term accommodation in the collaborative digital economy cannot remain unregulated or without sufficient enforcement, to the detriment of traditional and legitimate accommodation providers, who are asked to comply with high standards in conducting their business, as well as the local community, among others. This is especially so since the STR sector has been growing exponentially over the last years, including in our islands. Indeed, a 2019 Central Bank of Malta policy note shows that from just 813 Maltese apartments advertised on Airbnb in 2013, the number increased by 10 times in 2019.

While the proposed EU-wide regulation will not solve it all, it is a necessary first step to create more transparency and better sharing of data in the short-term private rental accommodation sector, on the basis of which national authorities can then better regulate and address the challenges which have developed in the STR sector. It is undeniable that the spread of STRs has given rise to some questions concerning the quality of service and maintaining the touristic product, safety and security issues, health standards, trust issues for customers, addressing illegal or unsafe listings, as well as a fair contribution towards the State and a better level playing field for all accommodation providers.

Along with these issues, the new Regulation and the data collected consequently would also help the national authorities regulate the impact of the influx of tourists on the infrastructure, the affordability of housing and other disturbance on the local community. It is also relevant to note that one crucial aspect that is particularly important for the tourism sector is the ability to collect and process economic, environmental and sociocultural data as a means to support decision-making by public and private actors, aiming towards a more sustainable touristic ecosystem.

When negotiating this Act, it will be crucial to strike a balance between the interests of hosts, platforms and consumers alike, keeping also in mind concerns of the local community and of traditional accommodation providers such as hotels. If this balance is maintained, it is my belief that the experience of all parties can be ameliorated, which would indeed have a positive effect on the sector at large, also allowing tourists to continue enjoying this alternative type of accommodation experience and hosts to continue benefitting from the income generated.

As an MEP who prioritises the well-being of various family and small businesses, I also appreciate the leniency towards the limited means of online short-term rental platforms qualifying as SMEs. Such operators will not be obliged to use machine-to-machine communication, thus, reducing their compliance burden and cost for technical resources and allowing them to compete with more prominent and digitally enabled actors.

All in all, the new rules relating to short-term rentals should be focused on fair competition. Equal access to the market and proportionate standards applied to all players in the sector, along with the benefits for the different actors involved, must be the focus of the proposed EU-wide Regulation.

Furthermore, the digital economy must be regulated to accommodate the market needs and the particularities of different participants within it, including SMEs, ensuring that they continue to play a significant role in the STR field, while incentivising them to digitalise and innovate, thereby further increasing their competitiveness. These developments have to be pursued while also striving to develop transparent and efficient systems for the sharing of data by hosts and platforms, achieving easily accessible and user-friendly systems, which provide for easy communication, an aspect which is paramount to take into account the less digitally-skilled actors in the industry and to ensure time efficiency for all the players involved.

Dr Josianne Cutajar is a member of the European Parliament

 

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