Picture: ISTOCK
Picture: ISTOCK

Brussels — Airbnb was warned by the EU to expect a regulatory clampdown unless its terms and conditions and the way it presents holiday-home prices comply with EU standards by the end of August.

The online platform must present price information more transparently and make the distinction between private and professional hosts clearer to consumers, the European Commission said on Monday.

"Popularity cannot be an excuse for not complying with EU consumer rules," said EU commissioner for consumers Vera Jourova. "Consumers must easily understand what for and how much they are expected to pay for the services and have fair rules, eg on cancellation of the accommodation by the owner."

Airbnb burst onto the scene a decade ago by persuading millions of people to open their homes to strangers — starting a trend for adventurous vacationers looking for cheap accommodation. It has faced criticism, including from landlords, of violating zoning laws and operating as an illegal hotel. Critics have also said abundant short-term rentals drive up housing costs and disrupt neighbourhoods.

"We take this issue seriously and are committed to being as transparent as possible for our community," Airbnb said.

"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."

Airbnb’s terms and conditions need to be made fairer and more understandable to consumers, said the EU authority, which urged the company to present changes "swiftly" ahead of a review by regulators. Airbnb had to either change or remove illegal terms in its terms of service, the commission said.

These included that the San Francisco-based company could no longer "decide unilaterally and without justification" which terms remained in effect after a contract was ended, or deprive consumers "from their basic legal rights to sue a host" if they suffered personal harm or other damages, the EU authority said.

The EU’s consumer arm lacks the teeth of other parts of the European Commission, such as the antitrust department headed by Margrethe Vestager. That led to frustration when it was relatively powerless to impose tough sanctions on Volkswagen in the wake of the diesel-emissions scandal.

Jourova said on Monday it was time to "evaluate the actions" by the car maker to help owners. "The rate of repair is now reaching 80%," Jourova said. "Quite good news" for consumers was that the car maker had "committed to continuing the free-of-charge update until the end of 2020."