The Bottom Line
- Increased Compliance Burden: Platforms like Airbnb and Expedia may be held directly responsible for ensuring listings comply with local laws, potentially requiring them to seek prior authorization to operate in certain EU cities.
- A Fragmented European Market: The opinion empowers individual cities and regions to impose their own unique rules on digital intermediaries, creating a complex regulatory patchwork that challenges a one-size-fits-all business model.
- The “Neutral Platform” Shield is Weakening: This signals a significant legal shift towards holding platforms accountable for the services offered through their sites, a trend with implications far beyond the travel and accommodation sector.
The Details
The opinion from Advocate General Szpunar addresses a clash between digital platforms and local regulators in the Brussels-Capital Region. The Belgian city enacted rules prohibiting intermediaries from listing short-term rental properties that lack a valid, pre-approved registration number. Airbnb and Expedia challenged this, arguing it was an illegal restriction on the freedom to provide services under EU law. They claimed the rule was a “technical regulation” targeting their online service, which would have required prior notification to the European Commission—a step Brussels failed to take.
The Advocate General’s reasoning draws a critical distinction. He concludes that the Brussels ordinance is not a rule aimed specifically at an “information society service” (that is, the online platform itself). Instead, he views it as a general rule governing the entire accommodation sector, applying to both online and offline activities. Because the law’s primary goal is to manage housing and urban planning, it falls outside the scope of the EU Directive that requires pre-notification. This legal interpretation effectively validates the city’s right to regulate the effects of the platform’s business on the local community, placing public interest concerns like housing shortages on equal footing with the free movement of digital services.
While this is an advisory opinion and not the final judgment, the Court of Justice of the European Union (CJEU) follows the Advocate General’s reasoning in the majority of cases. If the Court adopts this view, it will mark a pivotal moment for the platform economy. It shifts the regulatory focus from the individual property host to the powerful intermediary platforms themselves. This empowers local governments across the EU to demand more from these companies, forcing them to take an active role in enforcing local laws rather than claiming to be neutral technological conduits. The final ruling will be closely watched by CEOs and legal teams in every sector of the gig and sharing economy.
Source
Source: Court of Justice of the European Union
