Author: Simon Stokes
Electronic platforms such as Uber and Airbnb are giving regulators a headache. Are they just "information society service providers" under European and UK law – online platforms matching businesses/hosts and users (typically consumers) but not providing transportation or real estate services themselves? If they are just information society service providers then they currently benefit from light touch regulation and can operate freely across borders in Europe, benefiting from the free movement of services guaranteed by EU law.
The European Court of Justice has already ruled on this area in relation to online transportation "intermediation" services platforms in two cases relating to Uber, in Spain and France. These cases held that the services Uber was providing were transport services not an information society service. This meant Member States were free to individually regulate Uber and Uber would potentially be subject to local laws relating to transportation services.
A similar issue has now arisen in France in relation to another online platform, Airbnb. A French tourism association (AHTOP) and others had claimed Airbnb (operating in the EU through its Irish subsidiary AIRBNB Ireland UC) was in breach of a 1970 French law which required real estate agents and brokers (including in relation to search and letting) to be licensed and comply with other obligations. Failure to comply with this law is punishable by imprisonment and fines. The case has ended up in the European Court of Justice and on 30 April 2019 the Court's Advocate General issued an opinion that Airbnb were an information society services provider and were accordingly free to provide their online intermediation services across the EU, including in France. The Court usually follows the Advocate General's opinion.
The Advocate General distinguished between Uber who had control over the economically significant aspects of the transportation services offered through its platform and Airbnb who did not – Airbnb does not set prices (hosts do) and hosts also determine the letting conditions, availability etc. Airbnb should be viewed as purely an online platform – its hosts were providing real estate related services and lettings but Airbnb were not.
Assuming the European Court of Justice follows the Advocate General Airbnb will have won a significant victory. But this may be short-lived. The EU is close to adopting a new regulation that will regulate online platforms such as Airbnb as well as Uber and calls for the greater regulation of such platforms continue to grow across Europe. In any event whether or not Airbnb is itself regulated its hosts still need to comply with local laws when they let out their properties via Airbnb – indeed Airbnb provide a page on their website reminding hosts of their responsibilities.
Airbnb is just one example of PropTech in action and the case highlights some of the complex legal issues that apply to platforms as well as to technology businesses operating in the property sector.
