Friday, August 2, 2024

Short-Term Rentals

 


CityLab
Housing

Valencia Follows Barcelona in Crackdown on Short-Term Rentals

Tourist rentals in Valencia have surged 170% since 2015.

Photographer: Jose Jordan/AFP/Getty Images
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Spain’s Valencia region, one of Europe’s most popular beach destinations, is cracking down on short-term vacation rentals as officials nationwide grapple with growing anger over mass tourism.

The regional government will fine homeowners as much as €600,000 ($647,000) for renting rooms for short-term vacations, Nuria Montes, Valencia’s head of tourism, said during a presentation of Thursday. The government will immediately alert platforms they need to take out these kind of rentals.

Tourists on the beach in Valencia in July.Photographer: Jose Jordan/AFP/Getty Images

The “unorderly growth” of short-term rentals “creates damaging effects which, in the case of tourist apartments, could create social problems, a drop in housing supplies and the consequent increase in prices,” Carlos Mazon, the Valencia president, said during the presentation.

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Under the new law, set to be approved by the local legislature Friday, short-term apartments will also need to offer a 24-hour reception service and offer internet access. Tourism rentals will require a five-year license to operate.

Spanish tourism:
Barcelona to Ban Short-Term Rentals to Ease Housing Crunch
Hotels Try to Reinvent Themselves at Birthplace of Mass Tourism
Tourists Will Spend a Record €800 Billion in Europe in 2024

Valencia is the latest Spanish administration to tighten rules for lodging amid a widespread housing crisis and a growing number of protests against tourism. Barcelona, the country’s second-largest city and a favorite among foreign visitors, announced in June it will ban short-term rentals over time.

In an unexpectedly drastic move, Barcelona said it would close down more than 10,000 tourist flats currently licensed by the authorities. Local governments in the Canary Islands and Madrid are also set to tighten rules for these properties.

Although tourism is the most important industry in Spain, the world’s second-most visited country, short-term renting is widely considered a key driver for record property prices. This, and the impact of mass tourism on residents’ quality of life, has spurred protests in recent months.

A banner reading “Stop mass tourism” during a protest in Alicante.Photographer: Marcos del Mazo/LightRocket/Getty Images

Tourist rentals in Valencia have surged 170% from 2015, according to data provided by Montes Thursday. The region is home to Benidom, considered the birthplace of package tours and a popular destination for beachgoers from the UK and elsewhere across Europe.

Although protests against mass tourism first emerged in Spain before the pandemic and have been escalating since then, the frustration gained global attention in July after images spread online of protesters soaking tourists with water pistols in Barcelona. Rallies were also held recently across the Canary Islands and in Málaga.

Tourism is expected to account for 13% of total GDP and a fourth of Spain’s economic growth in 2024, according to CaixaBank Research. In Valencia tourism was 16% of GDP last year, according to government data.

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    Thursday, August 1, 2024

    class action against Philips

     


    European class action against Philips a ‘catalyst’ for future litigation

    Sarah JollyJuly 26, 2024
    Amsterdam, The Netherland - March 21, 2022: Amsterdam Breitner Centre - 23-storey Philips headquarters building. 'Royal Philips' (Koninklijke Philips) - Dutch multinational conglomerate corporation.
     Philips HQ, Amsterdam. Credit: Shutterstock/Kiev.Victor

    Europe’s first consumer class action under new legislation could kick-start further claims, putting risk managers on notice of an increased risk of litigation and costs, according to a legal expert. The group action against Dutch health technology manufacturer Philips claims damages for injury caused by its sleep apnoea devices and will be heard in the Italian courts after a filing earlier this month.

    Risk managers for manufacturers throughout Europe or with operations in the bloc should watch very closely, according to Sylvie Gallage-Alwis, partner and product liability lawyer at Signature Litigation in Paris. “The outcome of the Philips action could be a catalyst for future actions,” she told Commercial Risk.

    The case in Europe was filed just months after Philips paid $1.1bn to settle a class action in the US for similar claims regarding its sleep apnoea breathing masks, which alleged that foam used in the mask released toxic particles when it broke down, causing personal injury and deaths. The settlement was reached without Philips admitting any fault or liability.

    Philips recalled a total of five million machines worldwide, with US regulator the Food and Drug Administration receiving more than 116,000 reports of problems and linking more than 550 fatalities to use of the masks.

    Litigation in Europe has been made possible by the EU Representative Actions Directive, establishing a cross-border legal redress system for consumer collective actions. Rather than replace national laws in this area, the directive is intended to supplement national laws, which continue to vary across Europe. But importantly, it allows consumers in one member state to join a class action in another member state. All member states were required to implement the directive from June 2023.

    However, some countries have been slow to implement the directive, while legislation in France was proposed in March 2023 to extend the scope of its existing representative action law. “Since the new French National Assembly has just been elected, the appearance of this representative action will likely reignite the debate in France about the development of a more effective mechanism,” Gallage-Alwis explained

    The class action in Europe has been brought by the Global Justice Network and Italian consumer association ADUSBEF, seeking redress for 1.2m European users of Philips’s sleep therapy equipment for physical damages and emotional distress.

    Gallage-Alwis urged Europe’s risk managers to “be prepared and ready to allocate more of their budget to legal affairs” in light of the potential consequences for class actions under the directive.

    “This directive has very practical consequences, notably in terms of financial impact. The accentuation of these risks, and their potential extent, is likely to impact the cost of legal defence. The fact that companies will have to defend themselves more frequently, and against more claimants, will necessarily increase their legal fees,” she said.

    Further, consumer litigation can tarnish a company’s reputation. “Representative actions tend to attract media attention, which can damage a company’s reputation and consumer trust, which could result in a permanent loss of market shares,” Gallage-Alwis said.

    Companies can reduce the threat of representative actions by improving their customer services and enhancing procedures to address consumer complaints and disputes, she said.

    “Risk managers should make sure that their compliance programmes are at the required level, and if not, straighten them. This includes, for instance, implementing robust internal monitoring and auditing processes to ensure compliance with EU laws and regulations,” Gallage-Alwis advised.

    “Conducting comprehensive risk assessments regularly to identify potential areas of vulnerability to class action is also an efficient response that should be considered by risk managers.”

    She further advised firms to consider the implications from the cross-border nature of these actions.

    “It is strongly recommended to establish coordination mechanisms to manage cross-border litigation effectively, including collaboration with legal teams in different jurisdictions. Risk managers should also review and enhance insurance coverage to mitigate financial exposure,” she said.




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