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Tourist rentals 

 

Some readers may have heard about recent developments in the court cases proceeding against owners who had rented out their properties to tourists without using the appointed sole agent designated for their complex.

A fringe web blog in Tenerife has recently announced that the Canary government has apparently just admitted that all proceedings and fines issued against owners by the government’s tourist inspectors that were based solely on evidence obtained via the internet were in fact illegal and should never have been brought against those owners in the first place.

It should be noted that this is an entirely voluntary announcement on the part of the government. It has not been forced by any Judge’s decision or by any significant developments in the appeal cases.

This astonishing revelation does not appear to have found its way into the usual government publication channels at the time of going to press. However, if correct, the announcement basically means that affected parties can now have their fines cancelled, even if they have already paid them. This would theoretically include all owners who did not actually defend the court proceedings or who did not receive notice of proceedings in time to defend them.

Apparently, however, it does not help numerous owners whose cases were brought on the basis of evidence not obtained via the internet (e.g. the inspectors obtained evidence from other sources, such as a written statement from a tourist etc) and court proceedings under those claims are apparently due to continue.

Whilst this is being trum-peted as a victory for affected owners, there are issues arising out of this announcement that readers should be aware of.

Contrary to reports in some quarters, the government appears to have reached this decision voluntarily without any pressure from any Judge or outside group.

Some readers may recall that in May 2013 a Judge had informed lawyers for both sides that he considered that a large proportion of the appeals would not succeed and that all owners should accept defeat and stump up a reduced fine of 5,000€ each. At the time, the Judge invited one group of lawyers to control the proposed settlement agreement. It appears that whilst they agreed to look at this, the government subsequently rejected the settlement deal.

This raises the question as to why after all this time the government is suddenly admitting that it issued some of the fines illegally and is dropping the cases. The majority of the cases being appealed were commenced in 2011. The government has had two years to obtain legal advice on such a serious issue that immediately affects almost 1000 individuals or organi-sations. At least one of the numerous lawyers handling appeals on behalf of owners will surely have covered this legal point in a written defence, so the government must have been aware of the ‘internet’ argument from the outset. However, instead of capitulating, the government has metaphorically stuck its fingers up at all legal arguments for the past two years and pushed ahead in a particularly blinkered manner. The government should also have been buoyed by the Judge’s announcement in May 2013, which essentially suggested that the government would win its cases. So why would the government suddenly give up now after receiving such delightful news?

Furthermore, rather than endorsing the Judge’s €5,000 settlement proposal and potentially receiving millions of Euros in revenue from hundreds of owners without a fight, the government immediately blocked that settlement action. Four months later, it now voluntarily drops a large number of its cases and admits defeat. Why?

The fringe web blog concludes by stating that the above news means there is no longer a need to refer this matter to the European Court. Whilst this essentially admits that there were issues of European law prior to withdrawal of the cases, it conveniently overlooks the fact that there are still a number of appeal cases proceeding that are based on evidence not obtained from the internet. Those cases still require full defences to be argued, which should inevitably consider the applicability of European law (depending on the individual circumstances in each case).

As things stand, the ridiculous and unworkable rental law continues in force without a proper legal challenge. This puts us back in a very similar position to pre-2011 before the latest wave of fines were issued. No doubt the parties that engineered this ridiculous law in the first place would prefer to see it remain in force, albeit in a toothless form as it was from 1997 – 2010. Indeed, if it was now abolished entirely, the self-catering market would be completely opened up to free trade like in every other country in the western world.

In the meantime, all affected parties should contact their local ‘pressure group’ and demand to know what steps are now being taken to champion for the law to be significantly altered or abolished notwithstanding the latest announcement.

The above comments represent a theoretical discussion of the facts available and do not constitute legal advice tailored to each client’s circumstances. All articles written by Tenerife Solicitors have been formulated and approved by both our resident Spanish Abogado and by a dual-registered English Solicitor/Spanish Abogado who, for the record, has identical practising rights, status and regulation to every other lawyer in Tenerife.

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