### 2. Sharing economy

## (1) Background to the current focus on the sharing economy

The sharing economy refers to online services where individuals let others use their idle assets. The benefit to lenders is earning money from idle assets, and the benefit to renters is being able to use assets without having to own them. From the macro perspective, the sharing economy is expected to address the varied demands of individuals and resolve social issues. On the flipside, there are issues with ensuring security and protecting users.

What allows the sharing economy to function are the lowered transaction costs between individuals due to the proliferation of the Internet and the easing of time and location restrictions on using sharing economy services because of the prevalence of smartphones. Besides these reasons, the ability to interconnect sharing economy platforms with social media has made it possible to better match needs between people and heighten the trustworthiness of the services.

One key policy trend in Japan on the sharing economy is vacation rentals. Various vacation rentals have appeared overseas and the market is growing quickly. Vacation rentals are needed in Japan too, both to address the needs of overseas visitors, whose numbers are skyrocketing, and the accommodation demand in large cities and to help stimulate regional economies. At the same time, drawing up rules governing such services must take into consideration adjustments with the Hotel Business Act and other laws and regulations, appropriate management to prevent terrorism and the spread of infectious diseases, and the prevention of trouble with neighboring residents.

The Council for Regulatory Reform issued its Third Report in June 2015. In response, the Cabinet decided the Implementation Plan for Regulatory Reform, which calls for studying vacation rentals from all viewpoints and reaching a conclusion in 2016. The Council for Regulatory Reform and its working groups began holding interviews with related ministries and agencies, experts in the field, business operators, and related industries in October 2015. In March 2016, they also held a public discussion on vacation rentals.

Furthermore, the Act on National Strategic Special Zones, enacted in 2013, made it possible to continue vacation rentals for payment — in other words, run them as a business — without the Hotel Business Act applying, in zones stipulated in zoning plans for designated businesses providing accommodations to overseas visitors in National Strategic Special Zones. The Council on National Strategic Special Zones established a zoning plan for Tokyo in October 2015 and for Kansai in April 2016. After the enactment of related ordinances, vacation rentals started operating based on the provisions of the Act on National Strategic Special Zones in 2016 in Tokyo's Otaku Ward and in Osaka Prefecture.

Following the cabinet decision of the plan mentioned above, the Ministry of Health, Labour and Welfare and the Japan Tourism Agency launched the Committee on "Minpaku service" (vacation rentals) in November 2015. The Study Group put together a report in June 2016. The report provides examples of rules established in other countries permitting individuals to operate vacation rentals after setting caps on the number of accommodation days per year and setting other conditions, such as limiting services to rooms inside dwellings. Rules are expected to be established, accounting for circumstances in Japan, with reference to these examples in other countries.

## (2) Examples of the sharing economy

### a. Vacation rentals and home sharing

The table below summarizes a few examples of the sharing economy related to vacation rentals and home sharing (Figure 3-1-2-1).

Figure 3-1-2-1 Examples of vacation rentals and home sharing

Service name	Provider and start date	Description
Stay Japan / Tomarina	Tomareru / Hyakusenrenma (Japan) 2014	Stay Japan is a service that matches people seeking accommodations with owners of condominiums or detached homes with empty rooms. Stay Japan has received special approval for vacation rentals properties in Tokyo's Otaku Ward and Osaka Prefecture, which, as National Strategic Special Zones, have established ordinances allowing vacation rentals. Tomarina is a service that matches travelers with various experiences, such as lodging at a farm.
Airbnb	Airbnb (U.S.) 2008	Airbnb is a community and marketplace where members can post, discover, and reserve unique rooms around the world on the Internet, mobile devices, and tablets. The company connects people with people and provides unique travel experiences in over 34,000 cities in 190 countries with accommodations at various price points. Airbnb was selected as an official supplier to the 2016 Rio de Janeiro Olympics and it planned to provide 20,000 accommodations during the Olympic Games.
Zizaike	Jian Yun Network Information Technology (Shanghai) Co., Ltd. (China) 2011	Zizaike is a service that introduces vacation rentals to Chinese travelers. According to the company, it has approximately 50,000 listings as of April 2016 in all countries.