COMMISSION STAFF WORKING DOCUMENT Subsidiarity Grid Accompanying the document Proposal for a Regulation of the European Parliament and of the Council on data collection and sharing relating to short-term accomodation rental services and amending Regulation (EU) 2018/1724 [...]
Date: 2022-11-07
Institutions: Directorate-General for Internal Market, Industry, Entrepreneurship and SMEs, European Commission
Subjects: Internet, data collection, digital single market, exchange of information, hiring, information system, property leasing, provision of services, tourism

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  EN 

   EUROPEAN COMMISSION  Brussels, 7.11.2022  SWD(2022) 348 final  COMMISSION STAFF WORKING DOCUMENT Subsidiarity Grid Accompanying the document Proposal for a Regulation of the European Parliament and of the Council on data collection and sharing relating to short-term accomodation rental services and amending Regulation (EU) 2018/1724  [...] {COM(2022) 571 final} - {SEC(2022) 393 final} - {SWD(2022) 349 final} - {SWD(2022) 350 final}  
 
 
Subsidiarity Grid 

-  As proposed by the Committee of the Regions with guidance in blue  

-  Obviously, the answers to the questions below, the explanatory memorandum and – if 

applicable – the impact assessment should be consistent. This may require some iterations.  

-  Please try to stay under 10 pages.  

1.  Can the Union act? What is the legal basis and competence of the Unions’ intended action? 

1.1 Which article(s) of the Treaty are used to support the legislative proposal or policy initiative? 

The legal basis used for this proposal is Article 114 of the Treaty on the Functioning of the 
European Union (TFEU) Article 114 TFEU, according to which the EU may adopt measures for the 
approximation of the provisions laid down by law, regulation or administrative action in Member 
States which have as their object the establishment and functioning of the single market.  

1.2 Is the Union competence represented by this Treaty article exclusive, shared or supporting in 
nature? 

In the case of internal market legislation, the Union’s competence is shared (Article 4 TFEU). 

Subsidiarity does not apply for policy areas where the Union has exclusive competence as defined in 
Article 3 TFEU1. It is the specific legal basis which determines whether the proposal falls under the 
subsidiarity control mechanism. Article 4 TFEU2 sets out the areas where competence is shared 
between the Union and the Member States. Article 6 TFEU3 sets out the areas for which the Unions 
has competence only to support the actions of the Member States. 

2.  Subsidiarity Principle: Why should the EU act? 

2.1 Does the proposal fulfil the procedural requirements of Protocol No. 24: 

-  Has there been a wide consultation before proposing the act? 
- 

Is there a detailed statement with qualitative and, where possible, quantitative indicators 
allowing an appraisal of whether the action can best be achieved at Union level? 

The Commission consulted a broad range of stakeholders, including online intermediaries 
platforms active in the tourism ecosystem, hotels and their associations, hosts, consumers, 
Member States at all levels and non-governmental organisations and cross-EU networks. A 
Eurobarometer survey was carried out; in September 2021, an inception impact assessment was 
launched and a public consultation ran for 12 weeks (almost 6 000 replies were received, 
including from citizens and hosts). Two workshops with all relevant stakeholders were organised 
respectively in October and December 2021. In addition, two targeted surveys were launched in 
2022: a consultation of public authorities, including local and regional authorities, (80 replies) 
and a consultation of online platforms (15 replies from platforms of all sizes).  

1 https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:12008E003&from=EN  
2 https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:12008E004&from=EN  
3 https://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:12008E006:EN:HTML  
4 https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:12016E/PRO/02&from=EN  

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The explanatory memorandum of the proposal and the impact assessment contain a section on 
the subsidiarity principle. The impact assessment includes some specific developments on 
subsidiarity in the appropriate sections.  

2.2 Does the explanatory memorandum (and any impact assessment) accompanying the 

Commission’s proposal contain an adequate justification regarding the conformity with the 
principle of subsidiarity? 

Divergent and burdensome frameworks concerning data generation and data sharing put in 
place by Member States are affecting the ability of online platforms to operate cross-border. At 
the same time, the current interventions at national, regional and local level are often 
ineffective, including because authorities have in general difficulties obtaining data from 
platforms and hosts. An EU legal basis will enable data sharing by online platforms operating 
across the EU and ensure that the data exchanged is standardised and interoperable. Common 
EU standards for registration schemes will ensure that the procedure for registration is simple, 
contributing to reduced fragmentation and administrative burdens for online platforms and 
hosts. The common EU framework will offer national and local authorities the level of 
transparency they need to enforce the rules and adopt informed policy responses in line with 
existing EU law. 

The cross-border nature of online STR services offered by platforms and the fragmentation of 
data sharing requirements implies that the objectives cannot be reached effectively by Member 
States alone. Union action therefore constitutes the only way to ensure that a harmonised 
framework for data generation (through registration) and data sharing is established, which also 
enables public authorities to procure reliable data on STRs and online platforms to operate and 
grow in the single market without facing numerous and diverging data sharing requests.  

2.3 Based on the answers to the questions below, can the objectives of the proposed action be 

achieved sufficiently by the Member States acting alone (necessity for EU action)? 

The objectives of the proposal cannot be achieved sufficiently by the Member States acting 
alone. EU action is necessary because more transparency in the STR sector can only be 
accomplished by a harmonised European legal framework. Divergent data requests and 
transparency obligations on national, regional and local level lead to a fragmentation of the 
single market and cause significant administrative burdens and costs to online STR platforms. 
In addition, without the cooperation of online platforms, which operate mostly cross-border, 
public authorities struggle with the enforcement of the obligation on hosts to register. A 
harmonised framework on European level ensures that public authorities can procure 
sufficient, timely and granular data from online STR platforms to better inform their policy-
making on a local level. 

(a)  Are there significant/appreciable transnational/cross-border aspects to the problems being 

tackled? Have these been quantified? 

Online platforms intermediating STR services which have a high traffic share (to 97% of total 
traffic) and hold the vast majority of data operate cross-border.  Online platforms are 
increasingly confronted with a variety of national and local rules concerning data sharing 
requirements and other transparency obligations. This is an EU-wide phenomenon which 
appears to affect the large majority of platforms: requests come from almost all over the EU 
and from all levels of public authority (national, regional or local level). 

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These cross-borders aspects have been quantified to the maximum possible extent. 

(b)  Would national action or the absence of the EU level action conflict with core objectives of 

the Treaty5 or significantly damage the interests of other Member States? 

The absence of EU level action would affect the proper functioning of the single market, in 
particular in relation to the provision of services intermediating the provision of STR services. 
The majority of online platforms intermediating the offer of STR services operate across the 
EU and are confronted with several and diverging requirements and requests concerning 
information sharing on hosts and their activity and the display of information on STR 
services. Differences in national laws exist and are likely to increase, as national laws will 
continue to develop, given that some Member States have legislated or intend to legislate on 
the intermediation of STR services. Online platforms will also continue to be confronted with 
more and diverging data requests as a result of the growing need for transparency in the STR 
segment.  

(c)  To what extent do Member States have the ability or possibility to enact appropriate 

measures? 

According to the e-Commerce Directive, information society services are in principle subject 
to the law of the Member State in which the service provider is established; the adoption of 
national measures that restrict the cross-border provision of such services is subject to strict 
substantive and procedural conditions.  Requests to online platforms for personal data on 
hosts are subject to GDPR compliance. In addition, Member States may introduce 
registration schemes and market access requirements affecting the provision of short-term 
rental services. However, these requirements are subject to compliance with the 
requirements of the Services Directive. 

(d)  How does the problem and its causes (e.g. negative externalities, spill-over effects) vary 

across the national, regional and local levels of the EU? 

Differences in national laws exist and are likely to increase, as national laws will continue to 
develop, given that some Member States have legislated or intend to legislate on the 
intermediation of STR services. Online platforms will also continue to be confronted with 
more and diverging data requests as a result of the growing need for transparency in the STR 
segment. 

(e)  Is the problem widespread across the EU or limited to a few Member States? 

The problem is widespread across the EU. There are overall 23 Member States with some 
type of registration procedures and/or requirements that would enable them to gather 
information from platforms. Among Member States where registration systems are in place 
(22), these vary in scope, procedures, requirements and enforcement mechanisms, including 
the level of cooperation required by platforms.  A growing number of public authorities are 
putting in place regulations to collect specific STR data from online platforms. Also outside 
these frameworks, authorities increasingly reach out to platforms with requests for data.  

(f)  Are Member States overstretched in achieving the objectives of the planned measure? 

5 https://europa.eu/european-union/about-eu/eu-in-brief_en  

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Member States are overstretched in achieving the objectives of the proposal because they 
don’t have the possibility to create a common legal framework on an EU level that allows to 
streamline data requests and registration schemes. 

(g)  How do the views/preferred courses of action of national, regional and local authorities 

differ across the EU? 

The consultations indicate that public authorities are strongly in favour of requiring online 
platforms to share data on STRs to increase transparency and facilitate public policy and 
enforcement activities. The majority of respondents also consider that such measures should 
be put in place and/or facilitated at EU level. 

2.4 Based on the answer to the questions below, can the objectives of the proposed action be 

better achieved at Union level by reason of scale or effects of that action (EU added value)? 

(a)  Are there clear benefits from EU level action?  

The main benefit for online platforms results from the replacement of uncoordinated data 
requests by more streamlined and proportionate requests, which can be translated into cost 
savings on the long term. Savings for online platforms are expected to be substantial. A 
streamlined data-sharing framework will enable online platforms put in place an automated 
way to process incoming data requests from public authorities, thus making the cost to 
process a single request very limited and negligible. This proposal will also increase legal 
certainty for all online platforms by providing a closed list of data sets that that public 
authorities can request from them, and ensure that the obligation to share data is compliant 
with EU law.  

The main benefits for public authorities are the reduction of costs to obtain detailed, 
traceable, interoperable and timely data. This would enable better policy-making, more 
targeted and proportionate rules, and greater enforceability of their STR rules, helping public 
authorities better achieve public policy objectives. 

Hosts will enjoy a more predictable framework and an easier and faster registration 
procedure.  

(b)  Are there economies of scale? Can the objectives be met more efficiently at EU level (larger 

benefits per unit cost)? Will the functioning of the internal market be improved? 

The reduction of fragmentation will reduce existing barriers to market integration and 
support the capacity of local platforms to expand their operations to other markets and 
develop economies of scale.  

(c)  What are the benefits in replacing different national policies and rules with a more 

homogenous policy approach? 

The current interventions at national, regional and local level are often not effective, and 
authorities are complaining that they have difficulties in enforcing existing data generation 
and sharing requirements and therefore in obtaining data from platforms and hosts. The 
approximation of rules applicable to intermediary services will avoid the diversity of rules 
and requirements in the single market and facilitate data-sharing by platforms with public 
authorities and the cross-border provision of STR services. The data sharing framework 
proposed is expected to have a positive effect on market access, as it will provide the 
authorities with the complete and reliable data they need, supporting Member States in 

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discharging their obligation to enact and maintain proportionate rules. 

(d)  Do the benefits of EU-level action outweigh the loss of competence of the Member States 
and the local and regional authorities (beyond the costs and benefits of acting at national, 
regional and local levels)? 

The benefits of EU-level action for hosts, online STR platforms and public authorities 
outweigh the loss of competence of the Member States. The proposal strikes a careful 
balance between the interests of the stakeholders involved, while maintaining some 
flexibilities for Member States. The increased level of transparency resulting from EU action 
will support public authorities in evidence-based policy development and enforcement. 

(e)  Will there be improved legal clarity for those having to implement the legislation? 

The proposal will lead to improved legal clarity for those having to implement the legislation. 
Public authorities will benefit from and EU-wide legal basis to request and obtain data from 
platforms. The data sets that public authorities can request from online STR platform will be 
pre-defined in a closed list (maximum harmonisation). The registration procedures will be 
streamlined and simplified, to the benefit of hosts.  

3.  Proportionality: How the EU should act 

3.1  Does the explanatory memorandum (and any impact assessment) accompanying the 

Commission’s proposal contain an adequate justification regarding the proportionality of the 
proposal and a statement allowing appraisal of the compliance of the proposal with the 
principle of proportionality? 

Yes. The explanatory memorandum and the impact assessment clarify that this Proposal 
primarily aims at streamlining data requests across the EU to facilitate compliance of short-
term rental platforms with such data requests. An EU framework for data collection (by 
public authorities) and data sharing (by online platforms), will increase legal certainty and 
ensure that the data exchanged is standardised and interoperable. Member States are not 
required to put in place registration procedures for hosts, unless they wish to obtain data 
from platforms. Where a registration system is in place, an EU obligation for authorities to 
issue registration numbers and for online platforms to enable all hosts to display listings with 
such registration numbers, will ensure that such requirements for hosts are easily 
enforceable. It will also facilitate data exchanges based on this registration number. The 
common EU framework will hence offer national and local authorities the level of 
transparency they need to enforce the rules and adopt informed policy responses in line with 
existing EU law.  

The Proposal gives Member States and public authorities a certain degree of flexibility with 
regards to registration schemes (whether to introduce them or not, and at which level) but 
also with regards to the information and evidence that each authority can request from hosts 
(subject to compliance with the principles of non-discrimination and proportionality, 
established by the TFEU and the Services Directive). This ensures that the needs of Member 
States and local authorities are respected and taken into account. The measures proposed 
also strike a balance between the interests of all stakeholders involved, by requiring concrete 
action from public authorities, hosts and online platforms, ensuring the proportionality of 
the foreseen intervention. 

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3.2 Based on the answers to the questions below and information available from any impact 
assessment, the explanatory memorandum or other sources, is the proposed action an 
appropriate way to achieve the intended objectives? 

The intervention is limited to those aspects that Member States cannot achieve satisfactorily 
on their own. A legislative instrument, and specifically a Regulation, would be the most 
appropriate instrument to address more effectively the problems related to fragmented, 
burdensome and inefficient efforts to generate and share STR data across the EU, and would 
enable the coherent application of rules in the inherently cross-border STR sector. 
Nevertheless, the proposal grants enough flexibility to Member States with regards to 
whether participating in the data-sharing framework and ensures that certain specificities 
that apply in Member States and at the level of local authorities are taken into account, 
subject to compliance with EU law. The initiative creates financial and administrative cost for 
online platforms, public authorities and hosts; however, these are commensurate with the 
objective to be achieved and need to be measured against benefits, including costs savings. 

(a)  Is the initiative limited to those aspects that Member States cannot achieve satisfactorily on 

their own, and where the Union can do better? 

Yes, the intervention is limited to those aspects that Member States cannot achieve 
satisfactorily on their own. The EU framework will be applicable across the EU and will in 
particular simplify/streamline the landscape of reporting obligations on platforms. This 
harmonised framework will also prevent differentiated implementation of the obligation on 
platforms between Member States as the conditions for data sharing are the same for all (no 
selective avoidance).   

(b)  Is the form of Union action (choice of instrument) justified, as simple as possible, and 

coherent with the satisfactory achievement of, and ensuring compliance with the objectives 
pursued (e.g. choice between regulation, (framework) directive, recommendation, or 
alternative regulatory methods such as co-legislation, etc.)? 

A legislative instrument will be able to address more effectively the problems related to 
fragmented, burdensome and inefficient efforts to generate and share STR data. Limiting 
Union action to promoting voluntary industry-action and certain accompanying measures is 
possible but unlikely to be effective, as this would essentially rely on the industry’s own 
incentives and willingness to change the status quo. A Regulation is in addition the preferred 
instrument, as it is directly applicable in Member States, establishes the same level of 
obligations for private parties, and enables the coherent application of rules in the inherently 
cross-border STR sector. This will also address and prevent fragmentation of the single 
market. 

(c)  Does the Union action leave as much scope for national decision as possible while achieving 
satisfactorily the objectives set? (e.g. is it possible to limit the European action to minimum 
standards or use a less stringent policy instrument og approach?) 

Member States may decide whether to introduce registration schemes or not – and hence 

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whether to adopt the framework or not. The adoption and maintenance of registration 
schemes is only necessary where public authorities in a given Member State wish to obtain 
data from online platforms. In addition, the proposal grants flexibility with regards to the 
information and evidence that each authority can request from hosts (subject to compliance 
with the principles of non-discrimination and proportionality, established by the TFEU and 
the Services Directive). This ensures that the needs of Member States and local authorities 
are respected and taken into account.  

(d)  Does the initiative create financial or administrative cost for the Union, national 

governments, regional or local authorities, economic operators or citizens? Are these costs 
commensurate with the objective to be achieved? 

Under the preferred option: 

a)  Online  platforms  will  mainly  incur  one-off  adjustment  costs  linked  with  the  adaptation  of 
their  IT  infrastructure  and  the  connection  to  the  single  digital  entry  point  (estimated  at 
around  EUR  30  000  per online  platform), while  yearly  maintenance  is estimated  at  EUR 36 
000.  For  small  and  micro-enterprises  that  would  qualify  for  the  more  lenient  reporting 
obligations, the costs are estimated at EUR 2 400 a year. These costs are likely to be offset by 
the  savings  gained  from  reducing  the  time  spent  for  processing  and  challenging  in  court 
uncoordinated and varied data-sharing requests.  

b)  Public  authorities  implementing  the  framework  will  incur  one-off  administrative  costs 
(estimated  at  EUR  3  million)  to  adapt  to  the  new  registration  system  and  the  single  entry 
point. Yearly costs for hosting and maintenance of the IT infrastructure are estimated at EUR 
96 000 per Member State, for a cumulative cost of EUR 2.4 million. Where the framework is 
implemented at regional or local level, the costs for the registration system and links to the 
national single entry point will be borne by the relevant authorities. These short-term costs 
are expected to be offset by the long-term benefits that the framework will bring to  public 
authorities  in  terms  of  time  and  efficiency  gains  (facilitated  collection  of  data  and 
enforcement).  

a)  For hosts, one-off registration costs for current hosts would amount to EUR 97.44 million, 
while registration costs for new hosts would amount to EUR 5.96 million. However, savings 
are estimated to be higher than EUR 1480 million (due to monetisation of time saved in the 
registration process) for the new hosts that will be starting their activities in the first 5 years 
after implementation. Based on the assumption that 87% of the hosts are peers and 13% 
professional hosts, the cumulative cost savings for citizens over five years are estimated at 
around EUR 1287.6 million. 

(e)  While respecting the Union law, have special circumstances applying in individual Member 

States been taken into account? 

Yes. The proposal provides Member States and public authorities a certain degree of 
flexibility as to whether or not adopt the proposed data-sharing framework. Only Member 
States whose public authorities (national, regional or local) wish to obtain data on STRs for 
policy making and enforcement purposes (e.g. to ensure a sufficient supply of affordable 
long-term rental housing) from online platforms would be required to establish or maintain a 
mandatory registration scheme for hosts who offer their STR services via online platforms.  

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