NEW ECONOMY

European Union Parliament seeks to curb abuse in the sharing economy

MEPs want to ensure compliance with tax, labor and consumer laws by platforms such as Airbnb and Uber

Europe is concerned about the fact that a good portion of the so-called “sharing economy” is bypassing the rules. On Thursday, the European Union Parliament passed a resolution asking for common measures to fight abuse and ensure that collaborative platforms respect workers’ rights and consumers’ rights as well as honoring their tax obligations.

MEPs voting in Strasbourg.
MEPs voting in Strasbourg.PATRICK SEEGER / EFE

Without singling out individual companies by name, MEPs warned that this business model could lead to precarious situations, although they also stressed that regulation should not restrict the sharing, or collaborative, economy.

Meanwhile, the European Commission is analyzing new guidelines for the vacation rental industry, where peer-to-peer accommodation platforms such as Airbnb have made huge inroads.

Mixed feelings

European institutions have mixed feelings about this new reality. On the one hand, they do not wish to create hurdles to job creation in a continent where economic recovery is slow. On the other, they have observed the difficulties of getting these services to pay taxes, cover their workers’ social security contributions, or make themselves accountable to customers in the way traditional businesses are.

Without clearing up whether they are asking for new regulations or simply the implementation of existing rules, the EU Parliament approved a resolution that warns about “the need to address regulatory gray areas that cause significant differences in the Member States’ national and local regulations and case law.”

Regulation is required to avoid a dual legal reality between the digital and the traditional economy

Sergio Gutiérrez, Socialist MEP

The non-binding resolution was approved by 510 votes to 60, with 48 abstentions

“It’s being addressed more through case law than anything else,” said Nicola Danti, the social-democrat rapporteur who presented the report to parliament. “That’s led to rules that are difficult to interpret and to a fragmentary market.”

Although it originally welcomed the new business model with open arms, the vertiginous growth of the collaborative economy has created situations of unfair competition in sectors such as transportation. In Spain, there is growing confrontation between the regular taxi sector and app-based ride services such as Uber and Cabify.

In a country that relies heavily on tourism, the battle has also moved to the accommodation sector, where Airbnb and other peer-to-peer platforms have been targeted by authorities in Barcelona, Mallorca and elsewhere.

Thursday’s resolution recommends establishing criteria to differentiate between individual and professional providers, and to ensure that these businesses respect labor, consumer and tax legislation.

Spanish politicians in the chamber had differing views on the text. “Regulation is required to avoid a dual legal reality between the digital and the traditional economy,” said Sergio Gutiérrez, a Socialist who supported the resolution.

And Tania González, of Podemos, said the text is not clear enough and asked for “a regulatory framework” to avoid “camouflaging precarious jobs as opportunities for youth employment and entrepreneurship.”

Meanwhile Anna Maria Corazza Bildt, a Swedish politician of the European People’s Party, said that “overregulation is not the solution. We must spur economic growth in Europe.”

English version by Susana Urra.

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