Airbnb is poised to run into legal trouble in Thailand following court rulings that indicate short-term booking deals facilitated through the popular accommodation app are illegal. Specifically cited in the landmark decisions are property owners who rent out to local and foreign tourists on daily or weekly basis, a report said.
Owners of condominium and apartment units, and even villas, are deemed to have acted illegally when conducting rental business through Airbnb in the absence of license to operate, the Bangkok Post reported.
“The court ruled that people renting out their rooms have not obtained a license to run a hotel business under the 2004 Hotel Act,” the publication said, adding the law only considers rentals that last for 30 days or more as legal transactions.
The court decision, the report added, could negatively impact on Airbnb and similar businesses that have been emerging in Thailand in recent years.
“The rulings, if enforced nationwide, could be the beginning of the end for companies like Airbnb in Thailand … and the consequences … could be immense for the company, renters and consumers alike,” the report from Bangkok Post said.
Support From Industry Players
The legal decision gained the approval of the Thai Hotels Association (THA), which considers Airbnb and similar operations as threats and causing problems to the hotel and tourism industries in Thailand. According to the group, the market is now saturated with non-registered players that are known in the business as illegal hotels.
These entities will be reduced in numbers if the government will continue on the practice of strictly enforcing the existing laws, specifically Section 44 of the 2004 Hotel Act, the THA was quoted in the report as saying.
Airbnb Off The Hook For Now
To be clear, however, Airbnb’s operation in Thailand remains largely uninterrupted and per the related report from C9 Hotelworks “no specific legal action has been taken against the online booking engine.”
In reality, Airbnb merely became “the face of the issue,” in light of the unfavourable court decisions that were actually handed down in January 2018. It is safe to state, at the moment, that the online booking app’s presence in Thailand remains non-problematic.
The legal development though indicates that property owners in Thailand need to start worrying on “rising government scrutiny,” that likely will dog the industry and will put pressure on condo hotel and villa owners that rely on Airbnb but lack the license to operate.
The crux of the problem appears to be tied with the specific deficiencies of Thailand’s Hotel Act, which unlike in Bali, Indonesia has no provisions for registrations that condo and villa owners can take advantage of, the C9 report said.