Does Airbnb need to play by the rules?

Travel is an industry that can afford to arbitrarily fix prices if it so desires. It’s also an industry that can get away with charging a premium for safety and security, especially in foreign lands.

As a result, governments are keen on regulating it and making sure travelers, businesses or leisure, always pay a fair price.

Recently, the UK issued a strict notice to Expedia, asking them to review their marketing practices in a bid to protect consumers against unfair sales tactics.

Now, the EU is calling on Airbnb to align its terms and conditions with EU consumer rules and be transparent the on presentation of prices.

According to the European Commission, Airbnb’s current pricing presentation and a number of its terms do not comply with the Unfair Commercial Practices Directive, the Unfair Contract Terms Directive, and the Regulation on the jurisdiction in civil and commercial matters.

As a result, the European consumer authorities and the Commission have demanded a number of changes from Airbnb.

The travel-platform is expected to propose solutions for the Commission and the EU consumer authorities to review by the end of next month.

Failing to submit a response or propose appropriate corrective action could cause Airbnb to face an enforcement action.

According to the press release issued by the European Commission, the presentation of Airbnb’s pricing, as well as the distinction between private and professional hosts currently does not comply with the requirements of EU law, in particular, the Unfair Commercial Practices Directive.

In the regulator’s opinion, Airbnb should modify the way it presents information on pricing from the initial search on their website.

In essence, the intention is to ensure that, whenever properties are offered, the consumer is provided with the total price inclusive of all the applicable mandatory charges and fees, such as service and cleaning charges, from the get-go.

When it is not possible to calculate the final price in advance, the regulator believes Airbnb should clearly inform the consumer that additional fees might apply.

An important distinction that the European Commission would like Airbnb to make is between private and professional hosts, as the consumer protection rules differ for each.

Further, the regulator believes that Airbnb’s terms of services should be brought into conformity with European consumer law.

The Unfair Contract Terms Directive requires that standard terms and conditions do not create a significant imbalance between the parties’ rights and obligations, to the detriment of the consumer.

The Directive also requires that terms are drafted in plain and intelligible language so that consumers are informed in a clear and understandable manner about their rights.

However, the European Commission identified several instances where Airbnb’s practices failed to meet the requirements and comply with the directive.

Finally, the regulators want Airbnb to provide an easily accessible link to the Online Dispute Resolution (ODR) platform on its website and all the necessary information related to dispute resolution, pursuant to the ODR Regulation.

Commissioner Jourová, Commissioner for Justice, Consumers and Gender Equality 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.”

It seems as though the commission is keen on ensuring Airbnb complies with EU regulations without exception. The move is also an indication of the level of scrutiny that the regulator is prepared for when it comes to protecting consumers in the region.

“We take this issue seriously and are committed to being as transparent as possible for our community. Guests are made aware of all fees, including service charges and taxes, prior to confirming their decision to book a listing, and we will work together with the authorities to clarify the points raised,” Simon Letouze, Public Affairs, Airbnb told TechHQ in response to the story.