Sharing economy

Hotel operators push for law against ‘simply illegal’ Airbnb hosts and users in Hong Kong

Trade group argues home-sharing service that had 5,000 residential properties in city listed on its website last year is unsafe

PUBLISHED : Wednesday, 04 April, 2018, 7:03am
UPDATED : Wednesday, 04 April, 2018, 11:47am

Hong Kong’s hoteliers have united to demand a law that would punish Airbnb users – hosts and guests – and allow authorities to raid flats suspected of being unlicensed holiday rentals.

The Federation of Hong Kong Hotel Owners, which represents 90 per cent of businesses in the industry, said on Tuesday while Airbnb was not a direct competitor, the home-sharing service was “simply illegal” and must be opposed “as a matter of principle”.

Under the Hotel and Guesthouse Accommodation Ordinance, premises that offer sleeping accommodation for a fee over a period of less than 28 days must be licensed. But many hosts advertising on home-sharing sites were unlikely to have done so, critics said.

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“Airbnb has been operating illegally under the guise of a shared economy. But what have they really shared with the Hong Kong community?” Michael Li Hon-shing, the federation’s executive director asked.

What has Airbnb really shared with the community?
Michael Li, Federation of Hong Kong Hotel Owners

Around 5,000 properties in the city – most of which are residential flats – were listed as temporary lodging on Airbnb last year. About 300 were available at a given time, compared with 79,000 hotel rooms on offer.

The city’s hotels have an occupancy rate of close to 90 per cent and this is expected to continue with about 60 million tourists set to visit this year.

On Tuesday, the trade body questioned why efforts to tighten the Hotel and Guesthouse Accommodation Ordinance, which began in 2014, had stalled.

Enforcement of the ordinance is currently done through undercover operations.

Last year the Office of the Licensing Authority carried out 14,416 inspections, and successfully convicted offenders in 129 cases out of 158 prosecutions. Penalties mostly involved fines or a suspended jail sentence, though the maximum punishment is a HK$200,000 (US$25,500) fine and two years’ imprisonment.

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Under the tightened laws, if authorities had “circumstantial evidence” but not direct proof, they could still begin criminal proceedings against owners.

Li said authorities should also be allowed to apply for court orders to enter flats that were used illegally. At present, if enforcement agents knock on the doors of such flats, they have to leave if the owner turns them away.

The Home Affairs Department, which is overseeing the review of the law, said it planned to submit the revision to the Legislative Council later this year.

Lawmaker Elizabeth Quat, who supports tougher laws, said it was unlikely changes would be passed this year.

“The debate could drag on if the government launches a public consultation or if lawmakers request public hearings,” she said.

Li added that tourists looking for a more authentic Hong Kong experience may be lured by Airbnb, but most were unaware of the risks.

“They do not provide insurance ... Many are even lacking proper fire safety equipment,” he said.

Airbnb said it recognised the need to strike a balance between embracing innovation and addressing concerns from the community, and welcomed discussion to help stakeholders reach a decision.