Airbnb Legal in Thailand?

Existing Thai rental, property, and hotel laws, primarily drafted to deter illegal hotel operations, weren't equipped to regulate Airbnb's innovative business model ...

Airbnb, the ubiquitous holiday rental platform, boasts a staggering presence across 100,000+ cities. With over 150 million users and more than 4 million hosts, it’s effectively become the planet’s largest hotel!

For many of its users, Airbnb serves as a secure, affordable, and convenient method of booking accommodation in unfamiliar cities. The platform’s secure deposit system, user-friendly website, and a vast selection of properties make it an appealing choice.
At a glance, the platform’s convenience and security seem ideally suited for Thailand’s tourist hotspots such as Bangkok, Phuket, Pattaya, and Koh Samui…

The year-round influx of global travelers and the plethora of privately owned condos, apartments, houses, and villas make Thailand a natural fit for Airbnb!

But, is Airbnb illegal in Thailand?

To put it simply:

Promoting rental properties on Airbnb is legal, HOWEVER offering properties for nightly or weekly stays is not. Therefore, Thailand-based hosts are encouraged to only list properties and accept guests on monthly rentals.

If nightly rentals are illegal, how is Airbnb still operating and listing properties throughout Thailand?

The answer to this question is slightly more complex and it’s a topic of ongoing debate!

Airbnb Disputes in Thailand

The legality of Airbnb is a contentious issue. Hosts argue that nightly stays boost the local economy by directly benefiting individuals, whereas the Thai Hotel Industry warns of potential adverse impacts on the sector and potential job losses.

This standoff, often likened to a “David vs Goliath” situation, has plunged Airbnb into the center of the controversy!

Existing Thai rental, property, and hotel laws, primarily drafted to deter illegal hotel operations, weren’t equipped to regulate Airbnb’s innovative business model that empowers thousands of individual hosts to promote their properties to holidaymakers, business travelers and short-term renters from around the world.

Ambiguities in the current laws have led Airbnb hosts to believe that offering their properties for nightly stays is legal. Here’s a brief insight into the existing legal conundrum:

Hotel Act

The Hotel Act stipulates that any commercial operation renting accommodation on a nightly basis must have a valid Hotel License. However, there’s an exemption for operations with fewer than 5 rooms accommodating up to 20 guests, intended for small guest houses.

Interpretation of this exemption is confusing, since a condo owner is usually not renting more than 5 rooms or hosting more than 20 guests. Condo owners have exploited this loophole, interpreting it as applicable to their situation as they rent out a single property within a condominium building.

Condominium Act

Condominiums, on the other hand, have their own regulations, which mandate business operations to function only from designated commercial spaces within the building. This rule aims to maintain peaceful coexistence among residents.

The classification of nightly rentals as business operations introduces ambiguities, as it logically suggests that long-term rentals should also be regarded as business operations.

Pro-Airbnb critics also like to cite the Thai Civil and Commercial Code, which asserts that landlords are entitled to the benefits of their property ownership.

The Conclusion: The Hua Hin Court Judgement

In May 2018, a turning point came when a Hua Hin court convicted two Airbnb hosts for violating the Hotel Act. First-time offenders of the Hotel Act 2004 could face a 1-year imprisonment and a fine up to 20,000 THB. The two hosts, being first-time offenders, were subjected to relatively minor fines ranging between 10-15,000 THB.

These court rulings have set a precedent, potentially opening the door for prosecuting Airbnb hosts who advertise or rent out on a nightly basis. Despite the fines remaining relatively modest, it’s noteworthy that violators would have a permanent criminal record, with any subsequent violations leading to jail time!

Enforcement Realities

Despite the spotlight on Airbnb as the primary platform facilitating nightly rentals, several lesser-known platforms and business operators are involved in such activities. Despite the risks, many remain defiant due to the potential lucrative returns, openly challenging the authorities!

Cities like Bangkok, Pattaya, and Phuket are so expansive that individual hosts become “needles in a haystack”. Enforcement of the Hotel Act is often left to individual Juristic
Management Offices.

These offices have taken varying approaches in enforcing the laws. Some have overlooked and turned a blind eye on Airbnb hosts provided they don’t disrupt other residents, while others have implemented simple warning signs to scare offenders.

Taking legal action against a landlord, who contributes to the maintenance of the management team, can be a sensitive matter riddled with conflicts of interest. Therefore, some offices have installed access restriction devices such as face scans or key card locks to hinder the entry and exit of temporary residents.

It is important to note, some Juristic Offices do actively force evictions and bring about law cases to infringing landlords!

How Does This Affect Short-Term Renters?

While Airbnb as a platform isn’t illegal, offering a property for nightly rental violates the Hotel Act. This law targets the business operators, essentially the landlord.

Travelers booking nightly stays won’t face legal consequences, but they may encounter property access problems or even confrontations with management staff or residents who feel their privacy is being disturbed.

Hence, for stays ranging from a few days to a few weeks, it is advisable to book a hotel. The potential savings rarely compensate for the possible inconvenience, discomfort and ensuing issues!

Key Takeaways

The controversy surrounding Airbnb’s legality in Thailand stems from its impact on the local economy and the potential threat to the traditional hotel industry. The existing laws, created to restrict illegal hotel activities, face challenges in accommodating Airbnb’s novel business model.

Misinterpretations and loopholes in the Hotel Act have allowed condo owners to justify offering their properties for nightly stays. The Act, although stating that any commercial operation renting rooms on a nightly basis must possess a valid Hotel License, provides exemptions for establishments with fewer than five rooms.

A significant milestone in this ongoing dispute was the 2018 Hua Hin court case, which convicted two Airbnb hosts for violating the Hotel Act. This case set a precedent that could lead to the prosecution of hosts who rent out properties on a nightly basis. Violators risk fines, a criminal record, and possible jail time for subsequent offenses.

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