Mexico City Begins Regulation of Hosting Platforms like Airbnb and Booking

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The Mexico City congress approved changes to the local tourism law to regulate temporary accommodation services from digital platforms, such as the American Airbnb or the Dutch Booking, in an attempt to organize the tourist offer in the country’s capital.

The initiative, which came into effect on Thursday with its publication in the Official Gazette, was proposed last year by the interim mayor of the capital, Martí Batres, from the ruling Morena party, and includes, among other things, the creation of a registry of hosts for individuals and companies that offer short-term tourist stays.

In addition, these hosts are required to report usage and occupancy indicators and comply with tax obligations in an attempt to address “the problems” of gentrification, rising rents, insecurity, as well as unfair competition and the accumulation of garbage in areas frequented by tourists.

The changes, which were unanimously approved on March 21, stipulate that the registration in the registry will last for two years, must be displayed on the platform where the hosting services are offered, and must be renewed 30 days before its expiration.

Hosts must inform immediate neighbors about the tourist use of the offered properties and provide contact numbers to receive reports on misuse or emergency situations regarding those premises. In addition, they may be sanctioned if they commit infractions.

“Commercial establishments that were already in operation prior to the creation of the host registry will not be able to be registered as properties under the terms of this Law by any host,” it adds.

The growth of short-stay lodging units has impacted the displacement of original residents and the increase in the cost of living in some areas of Mexico City, home to nearly 10 million inhabitants. In some neighborhoods, entire buildings have been purchased to convert them into temporary hotels.

In addition, hoteliers claim that hosting platforms pose “unfair competition” that causes them economic losses since they do not pay the same taxes.

In recent years, cities such as Barcelona (Spain), Paris (France), Berlin (Germany), or New York (United States) have also regulated the use of hosting platforms. In Mexico, Airbnb operates, headquartered in California; Tripadvisor, headquartered in Massachusetts; Booking, headquartered in Amsterdam; and Trivago, based in Düsseldorf.

At the end of 2022, the capital’s government signed an agreement with Airbnb to attract digital nomads and creative tourism. On that occasion, the then-mayor Claudia Sheinbaum – who is now seeking the presidency of the country – invited “all remote workers from around the world” to come to the Mexican capital with the intention of capturing 5% of that population segment, which would result in an economic impact of 1,400 million dollars annually.

However, criticism quickly arrived from neighbors and opposition politicians, who assured that the agreement would encourage the arrival of digital nomads, which exploded after the end of the coronavirus pandemic.

Tourism represents 9.1% of the capital’s GDP, while 14% of employment in the city corresponds to activities related to tourism, according to official figures.

Currently, there are about 800 hotels with more than 60,000 rooms in Mexico City. Last year, the city received 14.4 million tourists – 29% international – who left an economic impact of about 7,900 million dollars.

Source: Expansion