Illegal Rental Fines

[Deso]

You forgot to mention the "Timeshare Touts" that said there was going to be a "Disney World" built in Caleta 

Who fell for that one

It will get built when they do the golf course in between Caleta and Nuevo.   

Next to the new bus stop. 

[peejay]

They're only going to do that though once they've completed the new marina!

[adewass]

Hi, not been on here for a while. I have just been reading the posts about illegal rental fines and would like to know if it is possible to find out what properties are residential or tourist? I am looking at hiring a villa in Caleta next year on Caleta Golf or Las Salinas. I know that this is a long time away and the Law may be challenged/changed by then, but until I read the posts on here i would not have known anything regarding this situation. I fully understand that it's the property owner and not the person hiring the property that will be fined, but again why are the websites offering properties for rent (Ownersdirect, Holidaylettings, Villaplus etc) not mentioning this issue on their homepage?

[emmi]

I fully understand that it's the property owner and not the person hiring the property that will be fined, but again why are the websites offering properties for rent (Ownersdirect, Holidaylettings, Villaplus etc) not mentioning this issue on their homepage?

You've answered your own question really!  Why should those websites have to advise holiday makers of an issue which does not directly affect them?  It's is the OWNER of a property who is taking a risk in advertising on the sites and should be aware of the laws.  The sites are generating revenue for themselves I assume, and a lack of advertising income would not be good for them, although I do question the moral issue. 

[Ivemovedon]

when you have a mortgage to pay on a property mis-sold to you, morals tend to come second.

Holiday websites couldn't care less. Up until 18 months ago most of them weren't even aware of the problem.

[emmi]

I was not questioning the morals of the advertisers, of course I understand the dilemma they face with having cost of a mortgage to cover.........I was alluding to the rental websites and the fact they either ignore or are not aware that their advertisers could be faced with huge fines and are not being informative..  The least they could do is have a brief summary of the facts on the site thus giving potential advertisers the choice of whether to risk the ad!!

After all, most financial advisors these days are obliged to inform investors that there are risks attached to most investment plans!

[adewass]

I do fully understand that it is the property owner who gets fined, but is there away of finding out if a property that I want to rent (short term) is only supposed to be used for residential (long term) lettings or wether the property is allowed to be used for tourism?

[Deso]

I do fully understand that it is the property owner who gets fined, but is there away of finding out if a property that I want to rent (short term) is only supposed to be used for residential (long term) lettings or wether the property is allowed to be used for tourism?

Basically, if it is advertised on the likes of Holiday Lettings, Owners Direct etc as a single property then you can be fairly certain that it is an 'illegal' let.

As far as I am aware, all the complexes and villas etc on the golf courses are classed as residential so can not be let out short term.

[adewass]

Thank you Deso, this does answer my question.

[fifi]

I was not questioning the morals of the advertisers, of course I understand the dilemma they face with having cost of a mortgage to cover.........I was alluding to the rental websites and the fact they either ignore or are not aware that their advertisers could be faced with huge fines and are not being informative..  The least they could do is have a brief summary of the facts on the site thus giving potential advertisers the choice of whether to risk the ad!!

After all, most financial advisors these days are obliged to inform investors that there are risks attached to most investment plans!

Hi Emmi, all of the main Holiday Rental websites are fully aware of the Canarian Laws. There is usually something similar to this (copied and pasted from Holiday lettings) in their terms and conditions.

( However, although we may provide the photograph or video, we do not warrant that we have conducted any inspection of the property. Advertiser shall be responsible for ensuring that it has all necessary rights, licences and authorisations to rent property.)

[richelworthy]

Posted today in Irish news Papers

PRIVATE holiday rentals could be restricted across Spain under a law being debated in parliament seen as favouring the hotel industry.

Alarmed at the number of tourists now choosing to rent accommodation privately instead of through hotels and registered tour companies, Spain's parliament is poised to pass a law that will restrict the right of home owners to engage in holiday lettings.

The legislation has been called a "death blow" to a sector that contributes greatly to Spain's economy and provides many struggling families with a lifeline at a time of economic hardship.

The law means it will be illegal to rent out property through websites without the correct licence and approval by regional tourism authorities. Home owners will have to ensure their properties conform to regulations already imposed on hotels.

"The passing of this law could deal a death blow to a growing sector that contributes enormously to the economy," said David Tornos, president of Asotur, the tourist rental management association, in Madrid.

The move has been welcomed by hoteliers, who have long felt private renters pose unfair competition in the sector.

With more than 6.2 million people unemployed in Spain, many families survive by letting out one room of their house to tourists, or move in with relatives during high season to make extra money.

[NorthernLights53]

Article from El Pais newspaper on the subject of holiday letting of private property:

http://elpais.com/elpais/2013/05/06/inenglish/1367842766_596787.html

[fifi]

Article from Canarian weekly about the law as it currently stands in the Canaries.

WE are back to the topic of Tourism Law, and the fines imposed on some landlords letting out their properties illegally.

An interesting search by Canarian Weekly has uncovered lots of information about landlords who have been fined because they have not been registered with the Tourist Board of the Canarian Government.

Over the course of many years, clients have asked me whether they have to register to be deemed legal landlords and the answer is not that simple.

We have to be careful not to get confused between a civil law matter (which relates to long term or short term letting agreements) regulated by the Rental Agreements Law or Civil Code (approved by the national Parliament) and that of the administrative law (authorisation to operate a tourism activity which includes tourist rental agreements) which is regulated by an Autonomic Law (i.e one that is approved only by the Canarian Government).

The administrative law is the area that covers the area of tourist property rentals, it's a tourist activity and consequently you have to follow the rules stated by every Autonomic Community (in this case the Canary Island Autonomic Community). The fines are not issued because you are "renting your property" but because "you are carrying out a tourist activity without the proper authorisation".

The Letting Agreement Law is a Civil Law and the Tourism Law is an Administrative Law. This means the first one regulates the disputes between landlord and tenant, while the second one regulates the relationship between the citizen and the State (in this case Canary Autonomic Community).

In other words, the Autonomic Community cannot stop you renting the apartment (because it is your civil right) but instead, can fine you because you're in breach of the Administrative Law.

There should be a common pattern to all cases in which individuals receive a fine. It normally starts with an inspection, you can give your defence reasons against the allegations, later you will receive a proposal of a fine. Sometimes, before the proposal you can be required to present documents in a reasonable period of time to the authorities. And finally you receive the final resolution with a fine. This resolution can be objected to before the same authority that granted this fine ("reposition") or appealed before the Economic Court. The resolution of the Economic Court can be appealed at the Administrative Court (which belongs to the Judicial Power and is independent). Bear in mind that, once you are fined (final proposal) you must pay the fine, appeal and later, if you win the case, the monies are refunded.

I have studied some of the ongoing cases. In one of them a rental office was fined for two reasons: 1) not reporting tourist activity to the authority and 2) not attending the requirement (after the inspection the Tourist Board sent him he did not present further documents). Note that the fine imposed by not attending the requirement was higher than the first one. That is why it is very important to attend every requirement made by any authority. In relation to the communication (report) to the Tourist Board, the Tourism Law states that this is an obligation and the lack of report is a serious offence and the fine can be from 1,500 – 30,000 Euro.

In other cases, there were two different fines: (1) not reporting tourist activity to the authority and (2) not having the "complaints sheets" and the "inspection book". Any tourist related business must have such sheets and books which means that even if you are registered you can be punished for not having such book and sheets.

Taking into account that these cases are based on non-resident owners who stay in the island few months and rent the apartment the rest of the year (if they can find a tenant), the questions and answers are:

Q: Can I rent my apartment?

A: Yes. As owner you have the right to rent your apartment. It is necessary to determine if you are at the same time doing a tourist activity (which is the reason of the fines).

Q: Is it necessary to be registered at the Tourist Board?.

A: If the rental is considered tourist activity you must report to the Tourist Board such activity. In other words if you are included in article 2.b) of Tourism Law which is the case of companies that offer accommodations and the complexes where these activities are offered. According to the Tourism Law there should be only one company allowed to deal with tourist rental agreement in every complex.

Q: What happens in cases in which the landlord does not what to deal with a tourist activity but rent privately his/her property short term?.

A: These owners can deal with rental agreement according to the Letting Contract Law or Civil Code (in these cases, according to Tourism Law, the tenant changes his address).

Although this is my opinion, my advice in cases when you receive an inspection is to contact a lawyer who knows about Administrative Law, attend every requirement (if not you can be punished for not attending it) at least to say that you cannot provide the documents requested, present allegations to the proposal of sanction and finally appeal against the sanction. If you are a company that lets out apartments be sure to fulfil all the obligations stated in the Tourism Law.

I realise that many people are concerned about how these penalties affect tourism, especially if the fined ones are ordinary landlords who do not act as a tourist company. I am just focusing this matter according to the legal point of view and trying to clarify the confusion originated in the difference between a civil law matter and an administrative law matter. I would be glad to hear from you if you have any comment or query.

Mariano Zunino Siri is a lawyer registered in Tenerife Bar Association since 1991. Office in Los Cristianos at Edificio Valdes Center Torre "A", oficina 1, piso 2º. Phone: 922 79 44 12.

[Blueboy7]

Very interesting and informative. Not certain if there was a specific reason why he should highlight non-resident cases over residents cases? I wonder how many cases are pending? and, if most of them are for letting agencies rather than private individuals?

[fifi]

Only 7000 cases as far as I can remember Blueboy. I think most of the Rental agencies were inspected first and the rest are apartment/villa owners. I dont know why they mentioned non residents either.

[fifi]

I had a quick look at the Boletins today and noticed a Caleta fine....http://translate.google.ie/translate?sl=auto&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&eotf=1&u=http%3A%2F%2Fwww.gobcan.es%2Fboc%2F2013%2F088%2F015.html&act=url

There may be more. I very seldom look at them these days.


If anyone knows the man mentioned please let him know because there is only 15 days to appeal and it would probably save him a few thousand  euros.

[Deso]

Looks like the inspectors were mooching around up the hill then. Caleta Alta are the ones behind Artenara and near to Senorio del Castillo where someone has a fine registered for 6 properties. 

[fifi]

Yes. It appears to have been visited on 27th April  2012 Deso.  I dont know if the other persons name is an Inspectors (as is sometimes the case) or the name of an individual denouncing him.

[fifi]

One of the well known rental agencies on the Island has also been fined.http://translate.google.ie/translate?sl=auto&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&eotf=1&u=http%3A%2F%2Fwww.gobcan.es%2Fboc%2F2013%2F066%2F029.html&act=url

[lander]

Hi Fifi, thanks for the info, now we have it in black & white that the fines are happening.  I'm sure most people know Room To Breathe, they've been around for a long time and they operate as a company so must be paying their taxes etc., they also employ quite a few people, this is really bad news

[peejay]

Interesting that the tourist rental company, renting 50 different properties is fined 13,500 euros - less than the 18,000 euro fines levied against individual owners. Hardly proportionate is it and shows how totally ridiculous these 18,000 euro fines are for owners - let's hope the lawyers in Tenerife are successful in getting them reduced to 1,500 euros on appeal.

I also hope that Room to Breathe are going to appeal, using the recent ruling on the EU Bolkestein Directive which states that 'prior authorisation' is not required to set up such a holiday rental business as an SL. Two such cases against companies in Tenerife have been quashed on appeal due to this, and it seems to be the main claim against Room to Breathe in this case.

[Globetrotter]

If the Canarian Government are using this act to get people into hotels and not private accomodation its not going to work, as there are people who only stay in hotels and there are people who only stay in villas/apartments.
So stopping visitors staying in private accomodation wont make them stay in hotels, they will look at other destinations. 
It wont improve the economy.

[peejay]

They don't care if there are less tourists, as this places less of a strain on the island infrastructure. They think they can attract tourists of a 'higher quality' who will spend more money on the island than those in self-catering accommodation.

[ashworth]

Most people who stay in a villa eat out most nights except for the odd BBQ and a family will spend up to a 1000 euros in the week.
In a hotel all inc or half board they will spend a few 100 Euros. Not Brain surgeon stuff for the local Politions to know who the best tourists are is it....

[peejay]

Ah, but they have done their 'research' which apparently shows that people staying in 5 star hotels, spend more locally than people staying in a villa or an apartment. Quite how this can be when many people staying in a 5 star hotel never actually venture outside at all is beyond me. Also, there is not an infinite supply of these high rolling 5 star types to go round, so best not to base your entire tourism strategy round them, eh? But remember this is all being driven from Tenerife, which is why it is so irrelevant and potentially damaging over here.

[fifi]

I have been thinking about the statement which was made by the Tenerife Lawyer in the article from Canarian Weekly which I have posted above.

We have all been informed that letting our property out for a period of three months or more is acceptable , BUT my query now would be......if, as the article states, the tenant must prove a change of address and then does not  bother registering with an Empadronamiento would the rental be seen as being of a Tourist nature?  It seems likely that it could be and the Landlord could be fined in that case also.

Should the Landlord take their tenant by the hand to the Ayuntamientos office and make sure that they register inorder to be safe? It sounds extreme I know, but what other way is there of making sure that your tenant who is staying in your property is actually changing address and not just having an extended holiday. How could you show proof?

.... Q: What happens in cases in which the landlord does not what to deal with a tourist activity but rent privately his/her property short term?.

A: These owners can deal with rental agreement according to the Letting Contract Law or Civil Code (in these cases, according to Tourism Law, the tenant changes his address).

[fifi]

I was not questioning the morals of the advertisers, of course I understand the dilemma they face with having cost of a mortgage to cover.........I was alluding to the rental websites and the fact they either ignore or are not aware that their advertisers could be faced with huge fines and are not being informative..  The least they could do is have a brief summary of the facts on the site thus giving potential advertisers the choice of whether to risk the ad!!

After all, most financial advisors these days are obliged to inform investors that there are risks attached to most investment plans!

Hi Emmi, all of the main Holiday Rental websites are fully aware of the Canarian Laws. There is usually something similar to this (copied and pasted from Holiday lettings) in their terms and conditions.

( However, although we may provide the photograph or video, we do not warrant that we have conducted any inspection of the property. Advertiser shall be responsible for ensuring that it has all necessary rights, licences and authorisations to rent property.)

I forgot to mention that  Lawyers from the three  leading Rental websites were worried about being sued for lack of "Duty of care" and had discussions about this several months ago.

[fifi]

I suppose if you are so opposed to the current situation you could always stand as a prospective Member of Parliament or form a lobby group to change the policy. I don't think writing bits on the forum will effect any changes to the situation. As already pointed out the indigenous population seem to have little or no concerns at present so pressure to make changes to the legislation are unlikely unless the general population can be convinced any change would not just benefit a few foreign property owners trying to make a buck to the detriment of existing legal holiday providers

ALOTCA have done just what you suggested Paul and the ammendments to the current legislation are due in a few weeks time. There are no changes expected for Residential complexes but Villa owners depending on where their villa is situated may be able to apply for a licence. The situation for apartment owners on Tourist complexes may end up even more difficult than they are at present. We will have to just be patient and wait a few more weeks and see what the outcome is. Well done to  Janet Anscombe and ALOTCA and the  Tenerife Lawyers for all their valuable information.

( As already pointed out the indigenous population seem to have little or no concerns at present so pressure to make changes to the legislation are unlikely unless the general population can be convinced any change would not just benefit a few foreign property owners trying to make a buck to the detriment of existing legal holiday providers)
[/quote] from Spike

As  you all  know, I have been involved in this campaign from the beginning, and I have always said that it will not register in  the minds of the people of Fuerteventura until it starts affecting their pockets. Isnt that always the case where ever you live?.

In Tenerife there was widespread support for the campaign from business owners, taxi men, bar and restaurant owners because they believed that they would lose business if private rentals were stopped.

Personally, I think that the only accommodation that would be missed in Fuerteventura is private villas. The likes of Alpharooms.com etc can easily cater for low cost apartment accommodation for DIY tourists and at a much cheaper price than a private owner could charge. My bungalow is on a complex where  half of the units are  privately owned and the other half  are owned by a company. Bungalows are being let out for between nine  and eleven euros a night through Easyjets website by the company according to a couple  that I met who were staying there last week. Three of them stayed there for only four hundred euros including flights. How could a private owner compete with those kind of prices? Key money, mid week clean, end of stay clean, IBI Basuras, non rental taxes plus rental taxes for the period that the property is actually let out. Electricity and water charges and insurance. There is no profit to be made.....simple.

End of rant.....but ....the moral of the story is....think twice before buying a property with the view to letting it out. The Islands are Autonamous which means that they can change the Spanish laws whenever they like and frequently do .....to suit themselves. Fair play to them ....but it doesnt suit my pocket.

[Ivemovedon]

Most people who bought property on the island over the last 15 years or so weren't looking to make bucketfuls of cash but just to hopefully earn enough to ensure the property paid its way. Council taxes, general maintenance, and maybe a meal out on the odd occassion. I don't think the effect of this foolish legislation will be noticed by the myriad of business's that it will hit until its too late. By then those responsible for implimenting it will be long gone, undoubtedly with a nice fat wad in their back pocket. Effectively they have put up a large sign saying that small private investment is no longer wanted on the island and i do think they will seriously regret it in the long term if not the short.
Another problem they may encounter is that in my experience there are far better destinations than Fuerteventura for 5 star hotel based holidays, especially All Inclusive, and i dont believe its a forgone conclusion  they are going to attract the clientelle they seem to think they are.

Still, its a bed of their own making and they will have to lie in it. Another rant over.   

[NorthernLights53]

And yet, despite all of this, apartments are still being advertised for sale as "having exceptional rental potential".

http://goldacreestates.com/Property?Country=jandia+golf&AAL1=&Options=QuickFind&Back=1828034137&pricemin=min&pricemax=max&bedsmax=All&PType=All&furnished=&refcode=

Sad really ... ... ...