Slovenia: Ministry of Economy proposes stricter rules for renting flats and houses

Slovenia: Ministry of Economy proposes stricter rules for renting flats and houses

A new hospitality law that has recently been sent for public consultation brings stricter rules for renting out flats and houses to tourists on platforms such as Airbnb. Service providers will have to get registered, have an identification number, and obtain certain permits while facing high fines for breaking the new rules.

The Economy Ministry has drafted the hospitality industry bill following a growing trend in short-term renting of private property to tourists in recent years. Over 9,700 pieces of flats or houses in Slovenia were advertised on Airbnb in 2019, generating EUR 66.5 million in revenue, it said.

According to Slovenian media, the figure compares to the combined 2019 revenue generated by Slovenian tourism companies Istrabenz Hotel and Terme Krka with their 17 top-class hotels, the ministry added. There has been a lot of rule-breaking in the short-term rental business, while property owners do not have to get a permit from other owners in multi-apartment buildings.

The new trend has also a negative impact on the competitiveness of other, traditional accommodation, while also affecting housing policy in major Slovenian tourist towns. The draft bill allows short-term renting of own or leased homes or holiday homes with up to 15 beds up to 30 days to a physical person as the landlord, a sole proprietor as an individual, to an association or a legal person.

The provider of the service must obtain a permit from the municipality in which the property is located, while for two- or multi-apartment buildings, the municipality can limit the period in which such rental is possible.

The service provider who rents out own or leased property to tourists in a multi-apartment building up to 90 days a year and has up to five beds will be obliged to obtain consent from 75% of the apartment building owners. Providers of the service will also have to be registered in the country’s business register, the main public database of all businesses. They will have to get a special identification number for marketing purposes. The number will not be public, known only to the service provider and oversight bodies.

An individual or a legal entity will face a fine of EUR 4,000-10,000 for failing to obtain a municipal permit or a permit from other property owners. A fine of EUR 40,000-100,000 is meanwhile envisaged for a legal entity running a public booking platform for not enabling rental service providers to display their identification number. The draft bill, sent into a public consultation period at the end of last week, also relaxes the strict definitions of individual types of hospitality establishments.

The change was prompted by the emergence of new types of accommodation such as glamping or other innovative types of outdoor accommodation and by the fact that the line between establishments offering food and drink, such as a cafe, confectionery, snack bar, is often blurred while still heavily regulated by law. This at times has a negative impact on the development of innovative products.

If the new bill is adopted, hospitality establishments will be able to set their working time on their own, while municipalities will still have an option of limiting it, yet only in the period between 10pm and 6am./ibna