vivienda-con-fines-turisticos

Struggling With The Cession In The Use Of Housing For Tourist Purposes

Coronavirus News, Legal News

In the midst of the turmoil caused in the tourism sector by COVID-19, other sectors closely related to it such as real estate- or electronic commerce, are again in the spotlight due to the houses for tourist use and the way users access offers of these type of services.

In 2017, a new article was introduced in the General Regulations for Tax Management and Tax Inspections and Procedures, which imposed the following obligation:

“The persons and entities that mediate between the parties involved in the use of housing for tourist purposes, located in Spanish territory, in the terms established in the following section [of this same article], will be required to periodically submit an informative tax statement […] ”.

However, the Supreme Court (Chamber III), in a sentence of July 23, has declared void said obligation to inform the Tax Administration by intermediaries about the transfer of use of housing for tourist purposes leaving, therefore, without effect the referred article.

The Spanish Association of the Digital Economy (ADigital) understood that the collaborative economy generated by electronic commerce constitutes an important part of the “Digital Single Market Strategy” of the European Commission. Therefore, the obligation of information should be, as it has been, declared void because it requires its operators -mostly large platforms that intervene in numerous operations- extensive and complex information because the number of transactions is very high. Also, because in the case of intermediaries that are limited to hosting or storing data, most of the data required by the norm are not at their reach or control.

The actors that intervene in this type of activity, whether it is free or onerous, which involves the use of a house (entire or part of it) -already furnished and equipped for immediate use-, whatever the channel (web or traditional ) through which it is advertised or commercialized, are defined as follow:

  1. Intermediary: is the person or entity that provides the intermediation service (onerous or free), which includes collaborative platforms that provide these services on-line.
  2. Informative declaration: is the declaration form approved by the Ministry and signed by the intermediaries, that contains the following information: identification of the owner and his/her home that fully or partially assigns, as well as identification of the assignee person or entity, the number of days of enjoyment of the house for tourist purposes, and the amount received by the owner or its free nature, as well as any other relevant data.

The Supreme Court, in application of a judgment of the Court of Justice of the European Union, of December 2019, on Airbnb Ireland, annulled the aforementioned obligation because, as it is a measure that restricts the free provision of information services it should had been notified to the European commission and it was not, thereby violating both the Government Law and the Directive on mandatory information. Therefore, the Supreme Court confirmed that this argument is what lead to the invalidity of the obligation, regardless of the previous statements of ADigital.

As expected, given the cancellation of this obligation to inform, the three affected sectors have reacted but have done so, however, in a different way:

  • For the digital economy, as defended by ADigital, in its appeal, the permanence of this obligation to supply information would have forced changes to the business model and computer applications, with significant operational, technological, and economic costs. Also, it would have forced platforms to become periodic and exhaustive data collectors, which is nothing more than an obstacle to effective market competition.
  • For the tourism sector, there were some defenders of the obligation, understood as an instrument of control and fiscal transparency, which are now asking the Ministry of Finance to use this “opportunity” to approve a new proportional and transparent tax regulation. A regulation that effectively allows the control of tax fraud in the field of these collaborative platforms while providing and guarantying market unity, without limiting the sector.
  • For the real estate sector, this Supreme Court decision allows intermediaries greater freedom in these use of properties assignments for tourism purposes. However, they consider it may not be enough to counteract the devastating effect of the general decrease in tourism due to covid-19 that might lead property owners to try to rent their properties in more traditional markets, such as permanent rental (or habitual residence), without web intermediaries generally.

 

Clara Minero Macias

Lawyer specialized in Commercial Law

cmm@uhy-fay.com

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