The European Commission today announced that Airbnb has been found in breach of EU consumer law on many counts – primarily for lack of price transparency as well as other unfair commercial practices. The decision will require changes to Airbnb’s business model and its "unfair" terms and conditions.
This is a very significant step, as such an action is rare and involves coordination of all 28 EU Member States (and Norway and Iceland) via what is called the Consumer Protection Cooperation Network (CPCN).
To comply with EU law, Airbnb will now have to denote on their site whether the ‘host’ is a commercial operator or an individual, present final prices upfront (ie inclusive of taxes and additional service fees etc), and change their host’s ability to cancel services at the last minute without having to indemnify the consumer. The EU's demands also free up the consumer to sue a host who has caused them harm, thus increasing the responsibility of the host (which has up to now been limited by Airbnb's terms and conditions). The full list of unlawful practices they engage in are extensive and are detailed officially here.
Airbnb now has until August to amend its business practices to ensure compliance, or potentially face a fine.
The European Commissioner for Justice and Consumers said: "More and more consumers book their holiday accommodation online and this sector has brought many new opportunities to holidaymakers. But popularity cannot be an excuse for not complying with EU consumer rules. Consumers must easily understand what for and how much they are expected to pay for the services, and have fair rules - e.g. on cancellation of the accommodation by the owner. I expect Airbnb to follow up swiftly with the right solutions.”
David Weston of the Bed & Breakfast Association said: "We are delighted that the European Commission has taken such strong and bold action today to protect EU consumers from Airbnb's unfair contract terms, its misleading pricing, and its illegal denial of their hosts' responsibility for their guests' safety. This will help move slightly closer to levelling the playing-field with B&Bs and small hotels".