No fines for breach of notification obligation of Airbnb rentals

The Council of State ruled that a permit is required for holiday rentals to tourists. Municipalities that consider a report sufficient act in violation of the law. Therefore, the municipality of Amsterdam is not allowed to collect EUR 400,000 in fines. An upcoming amendment to the law will replace this permit requirement by a registration and notification obligation.

The Council of State of the Netherlands ruled that a permit is required for holiday rentals to tourists. Municipalities that consider a report sufficient act in violation of the law. Result: The municipality of Amsterdam is forced to withdraw EUR 400,000 in fines. An upcoming amendment to the law will replace this permit requirement by a registration and notification obligation. What happens now? And later?

Tourist rental: permit or reporting requirement?

The Council of State, as the highest administrative court, ruled on a case a house owner  brought against the Municipality of Amsterdam. The municipality had fined the owner with EUR 6,000 because she had rented out her home to tourists without prior reporting to the municipality. That notification was required under the municipal housing ordinance. The owner did not agree with the fine and lodged an objection and appeal.

The Council of State ruled in favour of the owner, causing the fine to expire. Residence rental to tourists (holiday rental) qualifies as withdrawal from the housing stock. Pursuant to the Housing Act, a permit is required for this. The municipality is not authorised – in the local Housing Ordinance – to impose a notification obligation in lieu of this permit obligation. Therefore, the municipal obligation to report is invalid, so that non-compliance cannot be fined.

Is a permit required now?

The ruling of the Council of State made it clear that renting out houses to tourists is not allowed, unless the landlord has a so-called conversion permit. But whether a lot is actually going to change remains the question.

Municipalities can decide not to enforce, despite the absence of a permit. Their enforcement policy must then contain in detail in which cases no fine will be imposed in the case of (illegal) holiday rental without a permit. This is possible, for instance, if the landlord has reported the holiday rental in advance and the other municipal conditions for holiday rentals are complied with.

Introduction of registration obligation for rental to tourists

The negative effects of holiday rentals – reduced quality of life, increased pressure on the housing market, improper use of housing and unfair competition in relation to hotels – have not escaped the attention of the Hague legislator either. A legislative proposal has now  been submitted to amend the Housing Act. This Amendment will give municipalities the opportunity to introduce a system in which – depending on the seriousness of the negative consequences in a certain area – stricter conditions are imposed on holiday rentals.

Landlords have to register once and they are required to list their registration number in adverts. This makes it easier for the municipality to enforce in the event of nuisance or non-compliance with safety requirements. The registration obligation can be combined with:

• A notification requirement for each rental
• A maximum number of nights apartments can be rented out for, by which the nuisance can be further reduced
• A permit requirement in areas where the nuisance caused by rentals is excessive, like the Amsterdam city centre

The amendment to the Housing Act also leads to an increase of the maximum fine from EUR 21,750 to EUR 87,000.

More information

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