The Court of Justice of the EU does not oppose the establishment of a national regulation on short-term repeated rentals, in a context of shortage. But the French judge will now have to verify that the City of Paris provides evidence of a housing shortage.

European justice validated the French law intended to regulate the rental of apartments for short periods, Tuesday, September 22. This decision has been described as “victory” by the City of Paris in a case that pitted it against two owners using Airbnb. Many European cities, faced, like Paris, with a housing shortage, have tried to legislate to fight against the phenomenon of tourist rentals on Airbnb or its competitors like Abritel / Homeaway.

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In its judgment, the Court of Justice of the EU, based in Luxembourg, considers that“a national regulation subjecting to authorization the rental, in a repeated manner, of a premises intended for the dwelling for short periods to a clientele of passage who do not take up residence there is in conformity with the law of the Union”.

The fight against the shortage of housing intended for long-term rental is an overriding reason in the general interest justifying such regulations.EU Court of Justicejudgment of September 22, 2020

The mayor of Paris and French hoteliers applauded this stop. “This victory, awaited by many cities, marks a turning point for the supervision of seasonal rentals and constitutes a step forward for the right to housing for all”, reacted Anne Hidalgo. “People who offer furnished rental accommodation must do so legitimately (…) All owners who offer their accommodation without registration are definitely illegal”, said Didier Chenet, president of the GNI, which represents independent French hoteliers.

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For its part, the platform said in an email to AFP “to welcome this decision which will help to clarify the rules applicable to guests who share second homes in Paris”. Moreover, she rejoices “to work closely with local authorities on proportionate regulation that puts families and local communities first and works for all”.

French law makes the rental of certain homes on platforms such as Airbnb conditional on prior authorization from the town hall in towns with more than 200,000 inhabitants and in the inner suburbs of Paris. Primary residences cannot be rented for more than 120 days per year, other accommodations must obtain a “authorization for change of use” at the town hall.

The European judges had been seized in 2018 by the Court of Cassation, supreme court in France, of several questions relating to provisions of the code of construction and housing. Previously, the Court of Cassation was itself seized by the two owners of Parisian studios, fined a total of 40,000 euros for having rented their property without the prior authorization of the town hall.

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The case in France is not yet over: the French judge will now have to verify that the City of Paris provides evidence of a housing shortage. And the municipality will have to justify the character “reasonable, transparent and accessible” of the mechanism put in place for second homes in Paris, known as “compensation”. By this very dissuasive device, a rental authorization is only issued to the owner if he buys a commercial space of equivalent surface to the property, which he must then transform into a home in order to compensate “loss of housing”.

The decision of the Court of Justice of the EU has a first concrete effect: “It will allow us to recover all the fines for illegal rentals that were frozen”, told AFP the deputy mayor of Paris in charge of Housing, Ian Brossat (Communist Party). Until now, these fines could not be touched by Paris, because the French courts were suspended from the decision of Luxembourg. According to Ian Brossat, the amounts concerned amount to “several hundred thousand euros”. This amount “will make it possible to finance additional controller posts”, he said, while Paris currently has around forty agents in the field.

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