France, the second-largest market in the world for Airbnb, has recently introduced the Loi Le Meur, a comprehensive law aimed at regulating short-term rentals. This new legislation, often dubbed by some as an “anti-Airbnb law,” is set to reshape how the industry operates in one of its most important markets.
During Scale France, an influential event for short-term rental professionals, a panel of legal experts, including Xavier Demeuzoy (Demeuzoy Avocats), Victor Steinberg (Steinberg Avocat), and Jean-Paul Yildiz (Realex Avocats), dissected the implications of the law. Moderated by Frédérick Seidita Aires (Booking Guys), the discussion highlighted the law’s potential impact on platforms like Airbnb, Booking.com, and property managers, both in France and globally.
If France, with its prominent tourism industry and strong position as a global Airbnb hub, enforces these stringent regulations, it could serve as a bellwether for other countries looking to regulate short-term rentals. Here’s what you need to know.
What Is the Loi Le Meur?
The Loi Le Meur is a newly enacted law designed to address housing shortages in France by imposing stricter regulations on short-term rentals. While the law doesn’t single out Airbnb, it introduces measures that impact all short-term rental platforms and operators. For example:
- Quotas and Rental Caps: Cities can impose stricter limits on how many nights a property can be rented, reducing the cap from 120 to 90 days for primary residences.
- Compensation Requirements: Operators in some cities, like Paris, may need to convert equivalent space into long-term housing to offset short-term rental use.
- Fire Safety Rules: Properties hosting more than 15 guests face stringent fire safety requirements, more akin to hotels than private rentals.
For American readers, these regulations may seem extreme compared to the U.S., where short-term rental laws vary significantly by city and are often more lenient outside major metropolitan areas. However, France’s centralized legal framework allows for sweeping changes that can affect the entire country.
Why Should Americans Care?
France represents a critical market for Airbnb. With over 1,000,000 listings, it is second only to the United States in the number of properties on the platform. Policies that restrict rentals in France could have ripple effects on Airbnb’s global revenue and influence. Additionally:
- Potential Spillover Effects: Other countries in Europe, and even cities in the U.S., could take inspiration from France’s approach, especially those grappling with housing shortages and over-tourism.
- Increased Compliance Costs: These rules could make France a more expensive and complicated market for Airbnb to operate in, potentially reducing the supply of listings and driving up rental prices.
Insights from the Scale France Debate
During Scale France, legal experts provided a nuanced analysis of the Loi Le Meur. Here’s what they had to say:
1. It’s More Than an “Anti-Airbnb Law”
While the law does affect platforms like Airbnb, calling it an “anti-Airbnb law” oversimplifies its purpose and scope.
- Victor Steinberg, an expert on legal challenges, noted that the law impacts all forms of short-term rentals, from independent property owners to professional agencies. Focusing only on Airbnb ignores the broader implications for the industry.
- The experts emphasized that using the term “anti-Airbnb law” could harm the credibility of legal challenges and alienate non-Airbnb operators who are equally affected.
2. Challenges for Property Managers
The law introduces new risks for property managers, including:
- Liability for Client Non-Compliance: Managers can now be fined up to €100,000 (around $108,000) if their clients misrepresent property details, such as falsely declaring a property as a primary residence.
- Administrative Complexity: Navigating quotas, local rules, and new safety standards will require significant time and resources.
3. Where the Law Can Be Challenged
The experts highlighted several weak points in the law that could be contested in court:
- Quotas and Caps: These are seen as arbitrary and lack clear justification. Legal tools like France’s Question Prioritaire de Constitutionnalité (QPC) could challenge their proportionality.
- Co-Ownership Rules: The law allows co-ownership associations to retroactively ban short-term rentals, a measure that may conflict with fundamental property rights under French and European law.
- European Union Law: Restrictions on short-term rentals could violate EU principles of free economic activity, as they disproportionately impact businesses without clear evidence of public benefit.
What Should Short-Term Rental Operators Do?
Legal experts at Scale France offered actionable advice for operators navigating these new rules:
- Join or Form Associations:
- Collective action strengthens the industry’s voice in legal and political discussions. Associations can also provide a unified front when challenging regulations.
- Audit Your Operations:
- Ensure compliance with local regulations, including quotas, safety requirements, and property classification rules. Maintain thorough documentation to protect against fines or legal disputes.
- Engage with Authorities:
- Use France’s open data laws to request information on local housing policies and quotas. Proactive engagement can position operators as credible stakeholders in discussions with local governments.
- Prepare for Higher Compliance Costs:
- Invest in legal and administrative resources to adapt to the new rules. For U.S. operators with properties in France, consider partnering with local experts who understand the nuances of French law.
A Test Case for the Global Market?
As the second-largest market for Airbnb, France’s new regulations will be closely watched worldwide. For U.S. readers, this offers a glimpse into how stricter regulations could look if applied at scale. Whether this law becomes a model or a cautionary tale depends on its implementation and outcomes.
In the meantime, operators in France and beyond would do well to follow the advice of Scale France’s experts: stay informed, stay organized, and adapt proactively.
