The adoption of Regulation (EU) 2024/1028 of the European Parliament and of the Council on data collection and sharing relating to short-term accommodation rental services in April earlier this year marked a significant step towards harmonizing the fragmented rules for short-term rentals across Member States.
Created with the aim of standardizing and improving the transparency of the short-term rental market in the EU, focusing on the collection and sharing of data between EU Member States rather than directly regulating the operation of these rentals (e.g. health and safety standards, taxation, etc.), this Regulation is the first to establish a specialized legal framework for short-term accommodation rentals in the European Union.
It is important to note that before its adoption, short-term rental regulation in the EU was governed mainly on national level, with some EU-wide frameworks in areas such as consumer protection, VAT and digital services indirectly impacting the sector, but no overarching EU framework of this kind.
In general, the Regulation introduces an obligation for the so-called “hosts” (natural or legal persons who provide short-term rental accommodation services for remuneration through online short-term rental platforms) to go through a registration procedure for their unit in order to obtain a registration number that allows them to offer short-term rental accommodation services through online short-term rental platforms.
Currently Bulgaria like all other EU Member States, has a two-year period to create the necessary conditions for implementing the Regulation. This deadline is set for April 2026.
Progress on Implementing the Regulation
Bulgaria is still in the early stages of preparation for the Regulation’s implementation. However, following the adoption of the Regulation, the first preliminary steps in this direction have been taken, including:
Public Consultations:
The Ministry of Tourism has launched public consultations with interested parties, including municipalities, short-term rental platforms, property owners, and others, to identify potential issues with the implementation of the new rules.
Amendments to the existing legislation:
In recent months, the first draft proposals for amendments to the existing legislation reflecting the new framework have been published. The latter aim to provide for creating a unified digital entry point for data collection, a public and easily accessible register of short-term rental accommodations, a mechanism for temporary suspending of registration numbers, etc. The draft amendments are still in the consultation phase, and the final legislation will most probably differ from the current proposals.
Sector Feedback:
Meanwhile, representatives from the tourism sector have expressed concerns about the administrative burden that will fall on smaller operators, particularly those in local tourism, which could impact their ability to compete with larger businesses. Platforms like Airbnb have proposed solutions to facilitate compliance, particularly for smaller players in the market.
New Rules in the Context of Bulgaria’s Business Environment
In recent years, short-term rentals have experienced significant growth in Bulgaria, especially in tourist hubs such as Sofia, Plovdiv, and the Black Sea coast. However, this growth has sparked challenges such as housing shortages in urban areas, unregulated competition with traditional accommodations, and a lack of accurate data on short term accommodation rental activity. The new EU regulation seeks to address these issues while ensuring a level playing field for all stakeholders.
What Business Can Do at This Stage
To prepare for the upcoming changes, we advise businesses in the short-term rental sector to:
Invest in Understanding New Obligations:
Business owners should familiarize themselves with the new requirements and prepare for future compliance.
Begin Early Preparation for Compliance:
Although the registration system is not yet active, we recommend that property owners begin systematically collecting and organizing the documentation that is likely to be required for the registration process. This includes proof of ownership (e.g., notary deeds, lease agreements), property details (location, type, purpose, etc.), documents related to safety standards, tax compliance, local zoning, and any other required records.
Monitor National Developments:
It is in businesses’ best interest to actively track the progress of the legislative implementation in Bulgaria. Participation in consultations or industry associations can be valuable and create opportunities to influence the final resolutions.
Plan for Administrative Costs:
Affected businesses, particularly smaller players, should consider budgeting for registration fees or other expenses related to ensuring compliance.
Consult Legal and Tax Experts:
Due to the complexity of the new rules, consulting with legal and tax professionals can help businesses navigate the requirements and optimize their financial planning.
Looking Ahead
In addition to administrative challenges, the new requirements create opportunities. Increased transparency has the potential to attract clients seeking reliable and verified short-term rental services.
This also opens up the opportunity for compliant businesses to position themselves as such, which can be valuable, particularly for attracting international tourists.
