The Balearic Government is insisting that it will not back down on its prohibition of new holiday rental accommodation places. The European Commission (EC) has demanded that regulations are amended.
The ban only applies to apartments and therefore means that no new holiday rental licences can be granted for apartments. A cornerstone of the government's tourism containment measures, the EC first raised objections when the government issued the containment decree last year. A formal communication was sent to the regional government warning that the ban could violate the Services Directive and Article 49, which prohibits restrictions on the freedom of establishment of citizens of other countries.
In September, the government's legal services responded by defending the legitimacy of the regulations. But the EC's position remains the same. Its resolution is binding in demanding that the Balearic Government rectify regulations that are not considered to be in accordance with the law. It could therefore reserve the right to open an investigation and impose financial or other sanctions. The EC cannot directly fine an autonomous community (i.e. the Balearics) as responsibility lies with the relevant member state and so with the Spanish Government.
The EC's arguments revolve around the broad scope of the Balearic regulations. It believes that this type of restriction could only be applied selectively in specific areas where there is genuine strain on the rental housing market, but not as a blanket regulation for the entire region. In this regard, it is noted that such a measure could be feasible on an island as small as Formentera. The same cannot be said for the other islands. Mallorca, Menorca, and Ibiza are too large to justify a blanket ban, although there could be bans for selected areas. The EC believes the ban is "disproportionate".
Tourism minister Jaume Bauzá said on Monday: "We are convinced that we have done the right thing. We are committed to a regulation that seeks to protect residents and we cannot go against our own commitment to containment." The ministry's view is that the impact of holiday rentals in one municipality affects entire islands.