Written by Claire Leonelli and Claire Denoual, Avocats à la Cour
Published on 10.03.2020
According to the Court of Justice of the European Union (ECJ), AirBnB is not a real estate agent but Uber is a transportation service provider. #@?! Decryption.
Double standards...
In the first case, which gave rise to a ECJ ruling on December 20, 2017, a Spanish cab association accused Uber of unfair competition by disregarding the Spanish requirement to hold the licenses and approvals imposed to provide transportation services. Uber argued that this legislation did not apply to it because it was merely connecting non-professional drivers with customers via its application. The EJC notes that Uber actually goes further: it sets a maximum price for the ride, collects this price from the customer before paying part of it to the non-professional driver, and exercises control over the transport service provided, which can go as far as excluding the drivers. The EJC concludes that Uber is a transport service and not a mere service of the digital economy.
The underlying facts of the EJC's December 19, 2019 ruling on AirBnB are similar. A French tourism association had filed a complaint against AirBnB for illegally exercising the profession of real estate agent, for not holding the professional card required by French law. Here again, AirBnB's defense was that it only had a role of putting in contact renters of short-term accommodation and individuals. Noting that AirBnB does not control the essential aspects of the accommodation service, such as its location, standard or price, the EJC held that AirBnB provides a simple "information society service" and not real estate agency services.
... for a major challenge for collaborative platforms
The consequences of qualifying as an "information society service" or as a transport, accommodation or real estate service are important.
In the first case, the platform can benefit from favorable regulations: no need for specific approval (except for the general authorization to trade in Luxembourg which applies to all traders as long as they carry out a regular activity there), benefit from a lighter liability regime with regard to the content put online, etc.
In the second case, the platform must comply with all applicable sectoral legislation, which increases the formalities and obligations, whether in terms of prior authorization, regulation or liability towards consumers in particular.
It's all about influence
Contrary to what one might think at first glance, a detailed examination of these decisions shows that they are not irreconcilable: everything depends on the role of the platform in determining the essential conditions of the underlying service. While the platform's influence is decisive in this respect, its role goes beyond that of a mere intermediary, and it must assume the legal consequences, particularly with respect to any sectoral authorizations that may be required.
This criterion and its first applications lay the groundwork for the regulation of the collaborative economy. These conditions, which will certainly be refined in the future, must be kept in mind, especially by any start-up wishing to launch a project of this type, as they can have a significant impact on the chosen business model.
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