Govt to Submit Law Allowing AirBnB-Style Rentals Nationwide

By Jeff Wynkoop

The government has prepared a draft of a new law covering AirBnB-style (in Japanese, “Minpaku”) rentals to be submitted to the Diet in 2017. The purpose of the law is to legalize and facilitate the letting out of private residences by residential owners in any residential land-use zone in any part of the country.

The new law is significantly different from current legal rules, as it will allow regular owners of residences to lease out rooms without having to meet the requirements of the onerous Hotel Business Law.

In April this year, the Ministry of Health, Labour, and Welfare amended the Hotel Business Law to legalize a way forward for Minpaku rentals.

However, Minpaku operators under the Hotel Business law are subject to a number of rigid requirements, for instance, health and safety regulations that were drafted with hotels in mind. Also, Minpaku operators under the Hotel Business Law may not operate in certain residential zones. Thus under current legal rules, there are Airbnb-style operations that are illegally carrying out business in certain parts of Japan.

Details of New Draft Law

The new law will make it much easier for private owners to register their Minpaku with the government. Anyone will be able to apply to register their Minpaku over the Internet

Refusal of service. Unlike Minpaku under the Hotel Business Law, Minpaku under the new law will be allowed to refuse service to anyone for any reason.

Applicants (residential owners) will also have to appoint and submit the name of their real estate agent (intermediary) handling the property on the Minpaku application form.

Maximum rental days per year. In order to give Minpaku operators already registered under the Hotel Business Law an advantage in trying to build a stand-alone business, there will be a maximum number of days per year Minpaku operators under the new law will be allowed to lease out their properties.

For example, in England there is a 90 day per year restriction, and in Holland Air-BnB operators may only lease out their rooms a maximum of 60 days a year.

Maximum number of visitors per stay. In Japan, the authorities are also considering setting a maximum number of visitors at any one time (in Germany, the maximum is 8 per night).

Signage. Operators will also be required to display a Minpaku sign in the hallway of their homes.

Growing Number of Tourists

Japan has announced the goal of reaching 40 million foreign tourists per year by 2020, and the government recognizes the importance of increasing the number of facilities available for the growing number of tourists. In addition, there is a lot of attention being paid to making sure there is sufficient lodging for tourists visiting Japan for the 2020 Olympics.

Source: Nikkei Shinbun, May 13, 2016, evening edition

Photo: House in Sakuranomiya, Osaka