Alotca update on new tourism law draft

Alotca update on new tourism law draft

I was delighted to be able to offer news exclusively last week of a new tourism law (see HERE), and now, already, the draft legislation is being reported in the press. There are various aspects to it,  including a requirement for hotels to make renovations or risk being fined, and it stresses the Government’s intention to “stamp out” illegal letting in residential property.

It seems it will also require those complexes which are touristic to provide the offer for which they were designed, rather than be changed into residential usage, which seems connected with the issue I reported of facilitating the return of touristic licences to “dormant touristic” complexes. These too, along with the hotels, will apparently be required to upgrade and renovate, with fines applied to those who fail to comply.

When Alotca had the last meeting with Turismo, the lawyers laid enormous stress on the need to allow the licensing of private villas. This is something we’ve stressed extremely heavily throughout our dialogue at various levels of Government. At what point, and to what extent, this has permeated policy I cannot say, but the draft suggests they’ve taken it on board at least to some extent. I don’t want to raise hope recklessly here, and I want to check this out with the lawyers before I make a firm statement, but the draft legislation appears to me to go further than was initially offered.

As I said in my earlier post, it was already envisaged that villas on complexes that are currently residential, but whose land is or can be designated touristic, would be allowed to apply for touristic licences. Now, it seems that the law could allow the creation of  “zones” of individual villas in touristic areas which would form a type of complex, with a possible entitlement under certain conditions (e.g. percentage and density of villas to plot size) to change the land designation and acquire a touristic licence. Moreover, and tantalisingly, it hints at the possibility of independent villas in touristic areas themselves being able to acquire licences. As I say, I want to check out what this text actually means in practice before commenting further, but I think they might just be prepared to go quite a bit further in this one respect than their original stance.


  1. Wow! Janet, take a bow! Little steps…little steps!!

  2. OMG!!!! Janet you are a genius!!!!!!!!!!!! credit to you!!!!!!!! you may just have saved the livelihoods of thousands of people.

  3. Well done Janet, but it seems as if they are still sticking to their ‘up market’ policy, when are they going to realise that there are not enough ‘upmarket’ clients and that they are very much in the minority. What is the use of having a few 5* hotels and and Villas (and there are not that many villas in South Tenerife when set against apartments) when you have thousands of empty apartments next door to them
    South Tenerife is the largest holiday resort in Europe and it needs large numbers of tourists to survive, ‘up market’ tourism is desirable but definitely not the answer.

  4. Looks like tourismo are beginning to see some sense thanks to Janet and the team. This is really good news, not just for villa owners but the Canary Islands and more importantly its people.

  5. Very encouraged by this and your earlier post Janet. As someone who has been fined and am mid appeal my immediate concern is for a downgrade of the fine to a minimum level and in the longer term a sensible move towards arrangements that support the industry and owners alike.
    Thanks for all that you are doing.

  6. Author

    Thanks all. Please let’s not get too hopeful – I have to get confirmation of this, and of course this is still draft legislation rather than statute law. But yes, it looks hopeful in some respects. In others, though, the draft almost raises more questions than answers.

    It’s a start, anyway, and as Stewart says, little steps …

  7. Janet, thank you very much for reporting such important news and for your endless dedication.
    I have been reading today in different Spanish newspapers the news about the new Canarian Tourist Law. I respect your encouraging recent comments, but I don’t really understand the reason to feel so happy.
    (Source: Canarias7)
    The most relevant points are:

    A) Dormant touristic complexes may rescue their old licenses to restart tourist activity.
    B) Restrictions to the increasing number of beds will have the exception of 5 star hotels and some other expressed below.
    C) There will be obligation to invest money on tourist complexes to keep quality standards and clients’ satisfaction. Fines will be imposed to agents exploiting complexes in bad conditions. If the owner of a complex doesn’t invest on renovation when required, the repairs may be given to an investor by imposition and as a last resort expropriation will take place.
    D) The name of this new law is exactly: “Ley de Renovación y Cualificación Turística” (Renovation and Qualification Tourist Law).
    E) The aim, according to the Government literal words, is to improve the quality of tourist offer in order to strengthen our top position in the European tourist industry. Therefore, Turismo will pay special attention to the condition of hotels, aparthotels, tourist apartment complexes and any other type of legal offer on the market, forcing the refurbishment and improvement of old buildings and infrastructure which are harming our tourist quality. There may be some sort of incentives (less tax pressure or public subventions not determined yet).
    F) This Law will presumably be approved at Canarian Parliament in September.
    G) As a collateral effect, the Government maintains this law will cause the rescue of the building sector, where the unemployment rate is most remarkable nowadays.
    H) In some cases the refurbishment will produce an authorized increase of the number of beds in the complex.
    I) There will be a registration data base where any investor will be able to consult information.
    J) Refurbishments will require less paper work and less waiting time than in the past. There will be a specific available office to make this possible.
    K) 70% of employees in new tourist complexes and hotels will have to be selected and formed by Servicio Canario de Empleo (Canarian Employment Service).
    The above information has been taken from local newspapers today, so it is not a subject of opinion.
    Taking into account the previous statements, I would like to share with everybody my personal view:
    A) The sole agent system will keep remain and private apartments will not be allowed to be rented for tourist purposes individually.
    B) The future legal number of beds in a couple of years will be many more than nowadays, which gives the chance to move “illegal” visitors to legal accommodation when most illegal lettings are abolished.
    C) Those who have an apartment in a dormant tourist complex will have the opportunity of letting again, but through the abusive sole agent with all the disadvantages you have been speaking about.
    D) If you are an owner with an apartment in one of those complexes mentioned in paragraph “C”, it would be better to remain residential as it is the only legal way to let by yourself (long term rent) and not having the community manipulated by a sole agent trying to force everybody to get into his business for very little money.
    E) Everybody in the forum finds unfair the sole agent system as it is against your freedom to rent and it breaks some European rights. Now the Government goes further. A property will be even expropriated if it is exploited under certain standard levels.

  8. Carmen,

    You dont mention anything about private villas?

  9. Author

    I think that last point is a hugely important one, Carmen, and although it’s there in my post, I think it’s worth stressing again. Touristic properties, including apartments, will have to achieve certain standards of quality and if they do not, then there will be fines and ultimately repossession.

    I don’t think anyone is jubilant, and as I said earlier, most of the draft law raises more questions than answers – and one of the most unclear parts is the system of sole agency. In some respects I agree with you, that the whole idea is to tighten it up, but the viceconsejero was adamant that there would be changes involving the system on touristic complexes, bringing in the new “condominium” and “shares system”, which the press is also referring to – but no-one yet knows how this will work. What I would say, though, is that if it is to remain essentially the same with abusive sole agents, why bother changing it at all?

    The villas are the only room I see for satisfaction here, and there’s too much confusion right now about what is being foreseen, which is why I’m seeking clarity. But if we get some movement on that, then it will be cause for happiness in that respect at least.

  10. Owner 123 – Yes, you are right. The only positive point I can see in what we know about it at present has something to do with villas. But I don’t expect them to obtain a license everywhere. They might be authorized to be exploited by private owners in certain cases not clear yet. That’s all! The rest of the new information published on BOC and press makes me repeat the most important words Janet pronounced in her previous post, which were: “(…) the whole idea is to tighten it up (…)”. Shares or condominium of any type will not mean that you, Michael, Peter, Jane, Steve or John will ever be allowed to let your property by yourself. Providing that a company does it for you after signing a contract, you will get a penny. And get ready to redecorate your apartments in a specific style before giving your keys to the company. You might recover your investment in 45 years’ time.
    As I have understood the text published, rescuing dormant tourist complexes is voluntary. Before reopening, there must be a sole agent willing to take them and the minimum number of units required by law willing to take part. I have not read anywhere that, for example, if 55% of a dormant complex starts a new tourist activity, the rest 45% will have to be closed. They are supposed to allowed to private use (with no commercial purposes) unless the Government goes even further in their policy of rights and freedom restrictions.
    Janet – It is clear you are more optimistic than me or I am more realistic than you. You sometimes bet for waiting until the last day break and I am in favor of making other simultaneous things apart from trusting the lawyers’ labor and being patient forever. But both ways, yours and mine are respectful ways to focus the problem.

  11. its very much a case of wait and see exactly what the government is going to change with sole agency as regards the dormant touristic complex’s. I myself feel that this is far too early for the government to want to actually sensibly reform letting towards a system of individual private letting. In my opinion the ashotel minister and all the hotel mafia are still going to try to keep their protectionist crazy system. They are going to have to face change , but they wiil not give in lightly, it will takr years of legal challenge and sadly years of damage to the canary economy. They obviously dont get the change in customers wants and habits, the internet is becoming the number one for all shopping, wine ,books,fashion,everything. These hotel mafia people are trying to hold back progress, they imagine that they should ignore the internet and private renters and that they can continue to work in a world of 1970’s package holidays, clients booking with thomas cook and being coached from airport to hotel. The canary government is trying to keep all the touristic apartments as agent run nearly hotels. Nine of that can happen, things have been done differently for too many years up to now, there is no need of all this collective regulation. I am with Carmen on this if the government is offering just this, but not suprised at this early stage.

  12. There is a limited amount of information out there at the moment and I think we should wait until the draft law is produced for ‘consultation’ before we start to make judgements. I personally still have confidence in ALOTCA and the lawyers and I know that Snr Escobedo has strong views about the unfairness of the sole agency situation – he has made it clear that reference to the European Court has not been ruled out.
    Things may be appear to be moving slowly and in minor steps – but they are moving!!

  13. Philip – I agree it is early to make judgements. Nevertheless, time goes by and you, as a group, are not doing enough to fight this terrible extortion, and waiting for thousands of fines to be welcome home. In December it’d be a great Christmas present. Why not let the world know about this injustice? Legal action proposed by your lawyers and legal alternative methods (publicity) to defend your rights are perfectly compatible.

    I have just read once again the project of this new law published on BOC on 14th June. There are some parts/paragraphs worth analyzing here. They are the following:

    “La ley incorpora una figura demandada por el sector empresarial como es la del condominio, entendiéndose por esto aquellos establecimientos turísticos de alojamiento cuya titularidad se encuentra dividida en diferentes unidades registrales, indivisas, sobre una finca cuya gestión se encomienda a una empresa”.
    This means the new law will include something that HAS REMARKABLY BEEN ASKED BY THE BUSINESS SECTOR (presumably Ashotel) as it is the condominium, concerning those tourist establishments in which buildings are divided into different registered properties and their exploitation is run by a company.
    Using our common sense, such requirement presumably made by sole agents will be in the single apartment owners’ benefit or in their companies’ benefit?

    “Otro de los desafíos que aborda la nueva regulación es la reconducción de la residencialización de los establecimientos turísticos, que afecta a varias zonas de nuestros núcleos turísticos.”
    This means the new law will avoid the present situation of many tourist complexes turning into residential when the sole agent goes to bankrupt or most unsatisfied apartment owners take their units out of the sole agent’s business. It seems a way of forcing failed tourist complexes to be reopened as they will have no alternative use. Needless to say the reopening must be responsibility for another sole company (never single apartment owners). Remember the Canarian protectionist model will not disappear at all as the Government has already stated. It is a fact recognized by Turismo in Alotca’s meeting).
    At present, when there is abusive behavior, the apartment owner, in spite of affording often huge community fees, has the option of renting long term without being subjected to persecution (by authorities). Using again your common sense, what will you do when you’re tired to get very little money from the sole agent and residential use may not be an alternative option as a result of the new prohibition? (change of use)

    In my view, which does not have to be your view, all points to a strategy planned to preserve tourist establishments, increase the number of legal beds on the market as well as their standards of quality and force little owners to exploit through the sole agent system with no alternative options (except keeping the property closed if possible).

    If I am wrong, we’ll know in a couple of years’ time.

  14. Carmen,

    I dont think anyone is getting carried away by this lastest statement, we wont know until all this has been clarified exactly how this will turn out. But many owners have received big fines and invested large sums of money in the canaries and all we have heard over the last 18 months is doom and gloom about our properties. This latest news does give a little bit of hope. Im sure over the coming months even years there will a lot more lobbying by Alocta and owners, but this is a much welcomed step forward.

  15. Owner 123,
    While you’ve been hearing doom and gloom over the last 18 months, thousands of fines have been issued. A new association was born, a number of fines have been appealed after investing €880 each, meetings have been celebrated and a reduced representation of affected people have registered in a blog (82 members so far). How long do you think present and future victims will have to wait from now on to start fighting effectively?

  16. I was a little worried myself yesterday when Janet posted the article and it mentioned what sounded like compulsary touristic exploitation. If Carmen is correct in what she is saying then that sounds like what this crazy protectionist government has in mind. Maybe the next move will be fining some apartment owners in touristic complex’s if they are illegally living residentialy, maybe a reasonable starting out fine of 18,000 euros or so.

    None of us should be at all suprised that at this early stage the canary government have come up with more daft protectionist measures, rather than accepting the reality of individual private renting, with no sole agent daft system at all. Let us remember that what we thought was a reasonable democratic europeon government, part of the civilised western world , actually sent out these massive fines , without any advance warning or request that wrongdoers stop their renting. This was never the actions of reasonable people. Having set on down the road like that, how could anyone expect them to suddenley wake up and see the error of their ways at this early stage and have them begin to reform the letting laws in a sensible and realistic way. When alotca talks about having a mountain to climb, this is the massive void that they are refering to. You have the ashotel tourismo minister sat in the room, talking as if sole agency is just a sensible system to allow private owners to rent out their own apartments to guests. Then if alotca say , well whats wrong with individuals doing that on their own, thats actually what they have been doing for 15 years, it works really well, infact people all around the world do just that , its quite normal really, and then the ashotel minister turns green with rage and refuses to debate the issue, well thats more or less where we are at now with this issue.

    We could not in reality have expected them to change their position so early in this campaign. Jorge said that they will never admit their mistake , maybe they will never be prepared to reform the law sensibly, only legal chalenge in europe might make them change the law. Only if the ashotel grip on the government were to be altered could any progress be expected in a sensible system to allow private individual renting.

    It is interesting though, that the government has come up with some proposals at this early stage, even though they may be dafter than the situation before and still all about sole agency. I would have guessed myself that at this time they would have said nothing but just repaeated that the law was the law and was going to be upheld. The fact that they have actually responded with something is significant, I think that it shows the campaign has them rattled a bit and they have felt the need to have to do and say something.

    If the governments latest proposals are as daft as carmen is telling us, that is not alotcas fault, our campaign goes on , we are going to need publicity and the legal challenge. We have to let the canary people know of the unnecesary damage their government is doing to their economy at this time.

  17. AG, I think it a little naive to say the Government must be rattled – the main thrust of the Draft Bill appears to be about upgrading the current legal accommodation on offer (something so many have said is inferior). I found one reference online to the Lanzarote branch of Architects praising it and saying it was something they had long been campaigning for.

  18. Gianella,

    You have mis read my quote. What im trying to say is after 18 months of doom and gloom of fines etc is nice to hear some positive news but not getting too carried away. Yes of course we must fight on.

  19. The Government has issued the press release about the draft law. Will there be published, or is there already published, the actual draft of the proposed law? (If so, where.)

  20. InterestedParty,

    You can read it on the BOC HERE, and also in these articles among many other: Canariasahora, europapress, 20minutos.

    In my opinion, the most worrying point is this one:
    “La normativa en marcha incide en las áreas convertidas con el paso del tiempo en residenciales: declara el deber de atenerse al uso efectivo que ostenten las parcelas turísticas según el planeamiento y las autorizaciones obtenidas”.
    It means more or less: “The new rule insists on the obligation to respect the specific usage of the plots of land where complexes are located, according to the urban plan and the obtained authorizations.”
    Therefore, in my view, it is not difficult to imagine that an apartment in a tourist building-site will not be allowed to be used residentially. And if there is a sole agent in the complex, you might have just two options: give your keys to the agent to be exploited or keep it closed.
    Carmen yesterday was so intelligent to suspect something about this. In fact, it is a way of making bigger the present number of legal beds so that in a short period of time there will be enough LEGAL room to accommodate thousands of tourists that nowadays book private illegal apartments. I have always thought the Government’s aim is to persuade illegal letting owners to rent legally through the licensed sole agents, except those apartments situated in residential plots.
    I have read lots of times on the forum the illegally exploited properties are so many that if you close them by fining everybody there will be a crackdown on the Islands. If your theory of so such high number of illegal lettings is correct, the only way to avoid the crackdown is precisely lobbying most renters to do it trough the authorized agents on each tourist complex.

  21. In my previous post I used the word “crackdown” incorrectly. Actually, I was going to write “economic collapse”.
    Sorry about the mistake.

  22. Author

    Jorge, that’s as I said in the post – “It seems it will also require those complexes which are touristic to provide the offer for which they were designed, rather than be changed into residential usage … “. It worries me too, but we don’t know yet what it actually means.

    IP I’m trying to get hold of an e-copy of the draft itself rather than a news report or Government summary so that I can put an actual link on.

  23. Jorge, that’s the press release on the BOC, not the actual draft legislation.

  24. have read the comments with interest and the new draft seems to indicate some movement so well done to Janet and the team.
    It appears to me that the biggest bone of contention with touristic sites is the monopoly granted to the sole agent.
    If the sole agent was one with some degree of moral fibre and did not rip owners off and take advantage of the law, but only charged a reasonable sum for the services given would the opinion on “sole agents” change?
    If so then perhaps its not the law of one agent that is wrong it is the lack of control over the sole agent which allows them to become “the most hated”
    I am in the process of trying to start a sole agency for the benefit of the complex owners, (at their request may I add). I am 5 weeks into the process and its just mind bogglingly difficult to get any information whatsoever to move forward. Even my lawyer is a snail. All we want to do is be legal… difficult can that be? I’ve lost the will to live.

    Just a final thought……”Why is there only ONE monopolies commision?”

  25. I have arrived at this website in the middle of this enormous net a few weeks ago. I am a retired Spanish lady. My deceased husband a I bought an apartment a long time ago just to enjoy a few months in Maspalomas every year. My complex must be touristic since there is a reception letting quite a few apartments short term. I am not interested in renting as I’m old enough to pay more attention to time than to profit. After reading and reading for a week (not only Janet’s site but also newspapers), I’d like to reply Pablo’s comment.
    Doubtless, everybody appreciates Alotca’s effort and work to improve the present situation. However, the new tourism law draft is not a result of Alotca’s tasks as far as I am concerned. On the contrary, it is the result of the necessity to renew old tourist complexes and hotels, avoid more tourist complexes turning into residential, create specialized accommodation for a specific range of not traditional tourists and give an answer to the hoteliers who have been denouncing in loud voice the illegal private lettings and the residential usage of tourist apartments within any sort of tourist complexes (including aparthotels) as a significant damage to their business and the deteriorated image given to visitors. Just let me clarify it’s their view expressed in the media, not mine.
    I have read you are trying to become an honest sole agent to be in charge of exploiting a complex. That sounds weird: HONEST is an adjective rarely connected to the noun AGENT, but I personally encourage you to succeed in your attempt and earn good money to put into the pockets of the owners of your complex. Congratulations on your enterprise! If the Government is telling the truth, you will be able to achieve your aim with little bureaucratic work. And you’ll have it easy to get the 50% + 1 unit said to be required as your complex is supposed to be in a tourist plot of land and due to that fact, few owners will soon dare to use their apartments residentially, just in case they are fined (for the second time). Their apartments’ exploitation will probably not be compulsory thank God and the prayers, but it will be better for them to get your rent to afford expenses than to have the property closed. (My fees: €190 per month excluding water and electricity supply). Who knows if after the new tourism law draft is approved at Canary Parliament, an inspector might knock at their doors asking if they are legally occupying the property for which they have paid so much money before this terrible crisis began. Well, actually, those who are not interested in taking part in your business also still have the chance to sell the property to an ignorant buyer that will get it 35% cheaper than the amount of money it used to be paid during the boom.
    If my husband resuscitated, he would die of a heart attack just to see what is happening. Poor him!
    And with regard to the frightening that will be caused to Canarian economy, I don’t really think it will take place. Your private letting activity will possibly be reduced to a minimum expression, but most owners will probably yield their properties to the authorized agent before being in red numbers. You have to pay fees and mortgages anyway.
    I myself will try hard to sell if I am on time and invest my money far away this “military dictatorship”.

  26. Thank you for your post Adela. You may be correct in saying that these changes in the letting laws are not because of alotcas campaign. Perhaps the government planned these changes to the law at the very beginning of the crackdown, first 18 months of fines , then they announce their proposals. It could be that they are thinking that the residential renters are only getting customers because so many of the touristic complex’s have got residential people in the apartments. It seems clear that their position is one of hotel protectionism, the thing they fear more than anything is individual private renting. I think they must wake up in the night screaming at the thought of the hundreds of thousands of residential apartments all taking their hotel customers. They seem happy with the sole agent system as it makes apartments have unnecesary hotel costs like 24 hour reception and maid service. In all fairness, as regards touristic complex’s, well what on earth is wrong with everyone renting individually without a sole agent? If a touristic complex has 100 apartments surely the main thing for the canary economy is to have 100 full apartments, why should it be only allowed if rented and controlled through a single monopoly agent?

    Adela I thing you may be wrong to say that the economy will not suffer badley from the crackdown, I think that it is already the case in south tenerife, things are slowing down. It all depends on how many illegal apartments stop renting , we can not agree on how many there actually are anyway. At the moment many have come off the internet advertising so they can not attract summer customers. many will rely on regular family and friends in the winter months but without internet advertising summer bookings can not be good enough. My wife told me only the other day that she could not find any wednesday flights to tenerife, maybe airplane slots are being pulled?

  27. I have seen something interesting on BOC today (19 June). There is a fine issued to a person whose name I will not say for €18,000. Nothing strange so far. Nevertheless, in this particular case the reasons to impose the fine were not the usual ones, that is to say, the lack of inspection book and complaints book. Here the reason was “no cumplir con el principo de unidad de explotación” (violating the obligation of having under the sole agent’s company 50% + 1 or 100%, which applies the case) as that complex has 142 units and one of them was exploited by her owner (but not the only one).
    I have been searching this polemic problem you are debating here for years because I have a private apartment in a tourist complex and I have been pressed by the sole agent even though I have never rented at all, but used my apartment by myself. Four different lawyers I have spoken to for the last years have told me that the “principio de unidad de explotación” only concerns sole agents, never apartment owners. I have also been told that in the courts you can find several sentences related to a particular complex in which the sole agent did not want to give back the apartments to a group of owners after cancelling their letting contracts. The supporting argument to defend the company’s rights in front of the judges was that the “pincipio de unidad de explotación” would compel owners to be under the sole agent’s exploitation. All the sentences dictated by different judges between 2008 and 2010 maintained that this argument was not valid as it was a specific part of an administrative regional law which only affected sole agents. I mean the agent had to have 100% of apartments exploited as it was an aparthotel but owners were never forced by law to rent (by that moment – we’ll see in the future). I know that in some of these civil proceedings it was used a formal reply to a consult made by certain owners to Tourismo in order to help the owners’ lawyer. In the official document, the Tourist Authority stated that this obligation NEVER concerns apartment owners, it compels sole agents to obey this specific article of the administrative tourist law and sole agents may be fined if they don’t obey this article (number 38).
    It makes me get astonished to see today that a private letting owner has been fined because of violating the “principio de unidad de explotación”. Paying attention to this violation, the sole agent should be the fined one -says my present lawyer. The owner of that apartment in Altamira has committed an administrative offense if she has been renting holiday makers, but she can never be guilty for breaking the exploitation unity.
    It seems to me it would be useful if you could transmit this information to Alotca’s lawyers so that they could examine the nature of this rare situation on BOC.

  28. We owned two apartments in a touristic complex for many years before the new law was introduced. Before this law was brought in we had our apartments registered with the Tourist Board and everything was legal. When the time came to vote for a sole agent it became a battlefield! At that time there were
    many people willing to become sole agent but no one person managed to get the required number of votes. Some interested parties tried to get together and come up with an arrangement whereby all the votes would be put together to achieve the required number and one agent would be given the title of sole agent.Smaller companies could then be formed under the umbrella of the sole agent. I think that this is legal if the sole agent agrees. Unfortunately all that happened were petty quarrels and arguments and the complex became Residential. I am therefore very interested to hear what the new rules will be and hope that there will be a solution to this problem as this same thing could happen again if a dormant tourist complex hopes to return to it’s tourist status.

  29. Author

    C7, HERE, is reporting today:

    Una modificación en particular, la que eleva hasta el 75% el porcentaje de camas de los complejos extrahoteleros que es necesario destinar a uso turístico para poder operar en el mercado, podría convertir «en ilegales» a entre 25.000 y 30.000 camas de apartamentos del Sur, según datos del presidente de la patronal turística de Las Palmas, Fernando Fraile. Hasta ahora el operador de esos apartamentos debía aglutinar la mitad más una de las camas.

    José Miguel Bravo de Laguna, presidente del Cabildo, consideró que «el tratamiento de la oferta extrahotelera es perjudicial para Gran Canaria y puede dejar fuera de ordenación un buen número de camas».

    In brief, sole agency requirement is to rise from 50%+1 to 75% for touristic complexes. GC Cabildo & businesses say this will put 25-30,000 beds in south GC alone into “illegal” territory.

    I stress I’ve still not seen anything in writing, so I don’t know how firm this is. It’s possible it’s from Ricardo FPA’s recent visits to the islands to promote the new law.

  30. As most people know, according to the current legislation, “extrahotelera” beds require 50% + 1 unit, presumably risen up to 75% from January on. However, there are also thousands of “hotelera” beds in which the law requires 100%. This percentage is easily reached in the case of hotels because the property belongs to a specific company, but when we are referring to aparthotels everything is different. They are classed as “hotelera”, too, but they are usually formed by hundreds of apartments owned by hundreds of different owners. Here it is much more difficult to get the 100% required and therefore most sole agents running aparthotels are in the same irregular situation as individual illegal letting owners. And what’s more, your fines are classed as “serious”, but breaking the principle of unity is classed as “very serious”. This fact entails that fines to sole agents for that specific reason should be between €30,001 and €300,000. Ashotel association is very powerful, which means that Tourismo will rarely inspect exploitation companies in aparthotels unless there is a denounce by a third party. Please, have in mind this info has been provided by three qualified professionals I have asked. It is not a science fiction film. Between 2000 and 2006 there were 89 fined sole agents in the Canaries for breaking “the principle of unity”. That is in Canarian press to be read.

  31. 75% I dont understand how that will help or encourage lapsed or dormant tourisitc sites to regain their licences ???

  32. Author

    Bear in mind this legislation is still in consultation stage, and I’ve not seen anything in writing yet. But yes, I don’t see how this will help – and I think this is what the GC island authorities were suggesting!

    People have been asking how much say/power/control the Cabildos have in touristic policy. Now we’ll get some idea depending on whether they are listened to, or ignored!

  33. the 75% plus 1 clearly makes it much harder for the dormant touristic to get legal under the current crazy letting laws. Further proof if that was needed that the crackdown is just hotel protectionism. The canary government are hoping that they can stimulate more hotel customers and so boost their economy like that, they have no thought for the fact that they might be wrong and that they are embarking on a mad crusade that is going to seriuously damage their economy. The power of ashotel in the canary governments affairs is staggering.

  34. Please, do not forget that one of the most probable principles to include in the new law draft is to prohibit any inadequate usage, which means that if you have a touristic apartment, you will not possibly live in it or rent it long term, needless to say the holiday letting must be trough a sole agent. As far as I can see the future, maybe 75% would be even easier to get than 50% today since every owner will have to use “properly” each apartment, depending on the property classification (residential or touristic).

  35. Going with the Canarian VP’s use of the word ‘condominium’ in relation to touristic complexes, maybe they’re looking at something along the US model:

    From Wikipedia:

    A condo hotel, also known as a hotel-condo or a Condotel, is a building used as both a condominium and a hotel.

    These hotels have condominium units which allow someone to own a full-service vacation home. When they are not using this home, they can leverage the marketing and management done by the hotel chain to rent and manage the condo unit as it would any other hotel room.

    Rental revenue is shared with the management company, and owners typically pay no upfront fees for management, which includes the marketing and reservation of the units. Typical monthly fees for units in the rental pool include FF&E (Furniture, Fixtures and Equipment) reserve and resort fee(s). Although the revenue splits between owner and management company do vary from project to project, most hover around 50 percent.

    Interesting. Doesn’t actually sound so bad after all! I must look into this further in relation to owners’ rights. I wonder if this would make touristic complexes more or less valuable?

  36. Author

    But it’s a Spanish concept too, where it simply means joint ownership. They might not be considering the American model. We just have to wait and see when the new law is in draft form.

  37. it does read like joint ownership with the sole agent doing the letting. Nothing to be glad about, the system does not work and it imposes higher costs onto the customer or lower returns onto the owner. The imposition of this system is completely against the method of a private owner just advertising and renting on their own, many people have done that in the canaries for many years. The government system involves hotel add ons, 24 hour reception, maid service etc, so in effect it creates nearly hotels. that is what ashotel wants to compete against , they fear private self catering accomodation priced accordingly. Alotca needs to promote permited individual private renting, like the portugese model, and we need to oppose these collective government schemes. They dont work and they stifle free markets and impose higher charges on customers. Many sole agents today will not take on new renters because they can not rent out fully the apartments that they have got.

  38. Author

    Just to be clear for those who mightn’t be fully up to speed, individual private renting isn’t on Alotca’s agenda, but there’s no reason why another asociación couldn’t be formed by interested parties to lobby specifically for that. Turismo won’t wear it, though, I am convinced.

  39. Just noticed my last comment hasn’t been posted. Is there a problem?

  40. Author

    no problem at all … haven’t got any posts for you awaiting moderation, and indeed they’re not moderated once anyone’s first post is approved. I’d have to remove any post I didn’t like, but I hardly ever do that, and haven’t in your case.

    No idea, sorry, but I can’t see anything.

  41. OK no problem. Maybe I didn’t hit the “post comment” button after all. I’ll try and remember what I said and put it in a new post!

  42. I agree with Andrew regarding the “joint ownership” viewpoint. I’d rather leave ours empty than have some greedy sole agent cream off all the profits himself for doing very little. Anyone like us who has been doing their own advertising, handling enquiries, taking bookings, arranging cleaning, etc for a number of years will know it’s not rocket science. It just needs an organised mind and a simple system in place so for a sole agent to “take over” all this and expect us to be grateful is absurd. I can’t even see the Governemnt allowing “family & friends” to be able to use owners properties either as I think they will just twist this to suit their own greedy needs. Anyone who has built up a repeat client base will have now formed strong friendships with these clients and will regard them as friends so why the hell not just let us have this one relaxation in the law! I won’t hold my breath that such a corrupt Government will allow this…..

  43. Craig,

    I understand your comments entirely but would like to ask your opinion as follows.
    If your sole agent wasnt greedy and charged a reasonable fee and worked with you instead of against you would you be able and willing to work with them?

  44. Yes of course I would but does such a sole agent exist as the only ones I seem to hear about are the ones who dictate to owners when they can use their own apartment and charge extortionate fees for the privelege? Also I’d be very surprised if we were to work with a sole agent that they would only charge what we have been? People who use our apartment wouldn’t suddenly take too kindly to being charged a lot more than they were used to paying especially as some go for 6 or 7 weeks at a time.

  45. Yes I exist.

    My point is that it is not really the law or concept of a sole agent its the fact that most just rip you off and leave you with a bitter taste.

    If the sole agents had a framework in which they legally had to work then maybe the system would work. however it is most likely that the “greedy” sole agents would soon dissapear and the whole system would then fall apart.

    I dont own an apartment but if i did I think my my energy would be put into getting rid of a bad sole agent and getting a good one in.

    I know…… all very well in theory and its easy for me to say.
    i wish you only well

  46. The concept of sole agency is entirely a canary artificial invention. It was ill thought out in the first place and in practice it has been largely ignored in favour of people just renting themselves, as craig points out. I think alotca should re consider the position on not campaigning for a legal system of private renting, like is the case in portugal. I mean thats not really asking for a system as such its just asking for normal everyday freedom. It baffles me as to why the canaries ever dreamt up this sole agency malarky. I have to say that I think its just a hotel/ashotel concept that creates competition from nearly hotels , since instead of lower cost self catering apartments you end up with nearly hotels with hotel add ons like 24 hour reception and maid service.
    For alotca to want to campiagn for a fairer system of sole agency I think would be pointless. This crackdown has come about because thousands of renters have got by for years by renting on their own without any sole agents. Thousands of happy customers have enjoyed holidays in the canaries in self catering apartments bringing much needed money to the canary economy. The hotels see this as unfair competition due to the lower overheads of the apartments without the hotel ad ons and imagine that if the law was enforced they would regain these customers into hotels. We know that this is not going to happen, people want to chose their holiday type at the cost that suits them. In the canaries if sole agency continues unopposed and private individual letting doe not emerge , then that will not be in the best interest of the canary economy. I dont think that alotca campaigning on the basis of what tourismo might agree to will be helpful. A campaign for a better system may take time but be more worthwhile in the end.

  47. Author

    As I’ve said many times before, Alotca is what it is. There is nothing to stop an asociación being formed to campaign for private letting but it is presently completely illegal and what is more, there is significant opposition to it anyway from the “residential” lobby.

    I’ve said so often what we’re in favour of that it now sounds like a broken record … reform of sole agency system, freedom to let private villas, both of which are technically legal in the sense that they do not violate the “unity of exploitation principle” as in the 95 law, or are the result of an extra-legislative measure such as the moratorium on touristic licences, and also in favour of a sensible level of fines for those “offences” that are clearly illegal, a complete change of direction for tourism policy …

    and yet we still get accused of “existing only for the villas” …

    We’re a legal Spanish asociación. We cannot campaign for what is currently illegal. We can campaign for a change in the law – and that is what the petition was going to be for – but we have been left in absolutely no doubt that the concessions we will get are going to be contained in the law coming out soon, and no further. This is not the end of our lobbying, of course, but it means a petition, at this stage, is not worth the expense and organization required when our attempt at dialogue meets such intransigence.

    You must understand the nature of a Spanish asociación. It is a legal entity. It has rules. It has to abide by, and operate within, the law … even if the law is an ass. You can raise hell privately and campaign for anything you like. A legally registered asociación cannot.

  48. My guess is that the hotels want to eventually take over the touristic complexes so they can run them themselves as condo hotels. Then they would eliminate the competition. I think that’s why they are rumoured to be increasing the sole agent requirement from 50% +1 to 75% + 1. That way, only the very best sole agents will make it, and if the rest don’t make the quota with whatever time frame they’re given, they will be out, and someone else will take over, i.e. someone with connections to the hotels.

  49. Author

    It’s not 75%+1. It’s currently 50%+1, and the rumoured change is to a straight 75%.

    This is not even in the draft legislation yet, though, so let’s see if the suggestion even gets that far.

  50. thanks janet, its a strange country is spain. The more you get into it you wonder how much of todays spanish legal approach is still based on the dictatorship? having to register as a protest group/campaign group, but not able to protest on an illegal point? thats very curious, so if you disagree with any current law you can not form a group to protest /campaign about it.

    Surely that is straight from General francos approach to laws and protesting?

  51. lets not forget also that it is a bit odd having to register as a protest group/campaign group in the first place, I have to say that seems eactly like the way you would have expected things in the good old days of General franco as well.

    When you hear of turkey being held back from eu membership due to its human rights situation today, well how did spain ever get in?

  52. Author

    You don’t “have to” register as a protest group at all. The reason for doing so is that it is a legal entity which is then taken seriously.

    One can of course lobby for anything, but lobbying for anything that is currently “illegal” necessarily requires a change of law, so that is what it is sensible, legally, to lobby for. If an asociación has a range of objectives, as ours does, then it is even more sensible to ensure that all objectives are legal in principle in their own right, otherwise the whole thing will be tainted with “illegality”.

  53. Pablo you are a rare breed! I’d quite happily love to see the back of the greedy, bullying sole agents to be replaced with more like you. As long as we aren’t dictated to as to which weeks we can use our own apartment (which is ridiculous given that we own our place outright!), clients aren’t ripped off with a huge price hike and we are involved in the advertising, bookings, etc then we’d be happy if this meant we were “legal”. Whether this would happen in reality though is another matter entirely. Owners should be able to choose when they want to use their own apartment and how many times a year or else what’s the point in buying property abroad in the first place?

  54. Craig,
    there are some sole agents whose system is different. For example, my apartment has been in the hands of the sole agent of ‘my’ complex since 1999. I haven’t been paid any money for the past 4 years due to the refurbishment made by him (€8,000 per apartment of which I suppose 50% must be in his pocket) and he says if owners want to get their keys we have to pay for the rest of the debt (about €2,300). Apart from this, community fees as so high that very few people are out of exploitation. If I want to use my apartment for my holidays, I can, but I must pay €30 per day self-catering. It’s all business for him. I have tried to sell lots of times, but it always happens the same. Nobody is interested in buying a property with such expensive fees and when anybody interested has asked at the reception for any information, the same answer has been given: ‘this is an aparthotel, all apartments must be for tourist purposes and we are the authorized agency to exploit’ (and the one which pays nothing). Furthermore, every time a estate agent tries to arrange an appointment, he/she is told that the property is occupied and not available to be shown. I feel like in prison. I have lost my investment, absolutely.
    After such short explanation, can anybody tell me anything to be patient and expect a miracle? Shall I wait for the new law to make things even worse to owners or what shall I do?

  55. Author

    That’s an awful story Paolo. Even without the new law, though, owners have some solution, namely to deregister and reduce below 50%+1 the apartments registered to the current sole agent. I am told by a reputable sole agent (John Parkes in Paloma Beach) that this is the way forward where owners are abused by their agent. Then another agent can be appointed with the disaffected owners registered to the new agency. Of course the new law might change things much to your advantage – but we don’t know the detail. In some cases it hardly sounds like the situation could be any worse.

  56. Thats just horrific and shouldn’t be allowed! The fact that he can legally do this to apartment owners is just a joke. I feel so sorry for you Paolo and I sincerely hope the new law will be a step in the direction of you regaining some control over the property YOU OWN! Sole agents like that completely disgust me and I honestly don’t know how they can sleep at night. Onbiously has no morals or any conscience whatsoever! Fingers crossed you escape your “prison” soon!

  57. Andrew/nelson … please could you stop referring to Franco & Dictatorship etc when commenting – it is highly offensive (and negates any chance you have of being taken seriously)

    And, by the way, did you know that, under a recent law (2010) short term lets under 30 days are prohibited in New York City unless the landlord owns the entire building.

    While I am at it … below is a link to a report of a hotel association calling on the Government to outlaw illegal holiday homes – June 2012 … in …. the Algarve. Maybe the “Portugese model” is not working after all.

    Sorry, if this is OT Janet

  58. Author

    No, I think it’s important to have the context. Thanks Doreen.

  59. Doreen, not sure what the problem is with mentioning Franco/Dictatorship? You might take me to task for mentioning Franco/Dictatorship if the issue is not relevant or perhaps I am making an incorect point/comparison , but why is it offensive just to talk about Franco? Why are you advocating a blanket ban on the subject of the man and his former 36 year enduring dictatorship of spain? I must admit that judging from Janets later posting yesterday it seems that Alotca is not legally made to register as a protest group or indeed it is not legally prevented from campaigning to reform an existing law , so it would seem I was wrong to imagine that the current laws in spain as regards alotca were a bit dictatorial. I was confused by what Janet had said about alotca not being legally able to campaign for individual letting.

    The article in portugal is interesting. What seems to be happening is that despite being able to register and let individually , some apartment owners are continuing to let illegally without paying the annual fees. Well shame on them, if only we in the canaries could legally do that rather than suffer our 18,000 euro fines. I would soon have my apartment full up again and I am sure a few potential portugal tourists would be diverted back to the canaries.
    Hopefully the portugese authorities can crack down on the rouges who are not playing fair. The portugese approach is the sensible way forward, legal individual letting , an annual fee to be paid to the government, no monoploy sole agent or concept of collective ownership.

  60. Any other joyous news Doreen?????

  61. Author

    I’m sure Doreen will reply for herself, Andrew, but in Spain we have a law of historical memory which makes it an offence to dredge up the dictatorship. Street names have been removed, places renamed …

    There are many who think this law doesn’t do anything other than sweep the whole thing under the carpet, but also many who think it allows for apologies, recompense, recognition of grievances of both sides from the civil war, and for movement forward with reconciliation.

    Whatever one’s view, it’s certainly not something one can play freely with. I too must ask you to stop, because as with the Mugabe references that I removed, it is my website and it is I who will get into trouble for “inflammatory comments” concerning a period of Spanish history that, really, only ended with the “democratic transition” between 1975 and 1978. That’s really not so long ago – well within the lifetime and memory of many of us. Hitler’s name is still incendiary and that was only 30 years earlier. Please recognize the offence/disruption/trouble it can cause to use such language in modern Spain.

  62. Craig,
    maybe I am a rare breed but my philosophy is that good business benefits both sides.
    It must drive you crazy, I would certainly think long and hard about Janets suggestion of deregestering along with other owners which would then presumably make this agent illegal.
    Why bother renting anyway if you get no return. you may as well just use it for your own pleasure you can’t be any worse off.
    Best wishes anyway.

  63. I could not care less for some old dead despot, but what is wrong with Doreen she has ceased to post on another site & now wont answer on this one she must have very thin skin.

    Her post about Portugal is scaremongering and is exactly what Andrew has said in his second paragraph

  64. Author

    She posted here only yesterday evening! Give her a chance to answer!!

  65. duly noted Janet, this is your site and I will avoid the references. Pablo is right , there would be no easy way to deregister a sole agent. People would not want to disrupt their own bookings or revenues. The whole process would take time and many people have mortgages and could not take the trouble to get involved. In my opinion alotca should forget about sole agency reform, the reforms the government is proposing seem far worse than the current situation. Promoting legal individual letting like portugal seems to me a clearer position to mount the campaign on. Trying to campaign for only what tourismo might agree to seems of limited purpose to me.

  66. Author

    We are not trying to campaign only for what Turismo might agree to but until we get some positive response from them it would be ludicrous to campaign actively for anything they’d rejected outright! And as far as private letting is concerned, that is a non-starter with Turismo, and we have said from the outset anyway that it is not part of our lobbying policy for reasons that I’ve given time and again.

    On other matters, though, they had no intention of allowing private villas when we started; they still have no intention of reducing fines to the minimum level; and we are trying to persuade them to change their whole tourism policy! How can you say we’re only trying to campaign for what Turismo might agree to? I regret that Alotca isn’t campaigning for what matters to you particularly, but this is now well discussed and it isn’t productive to keep repeating it.

  67. God there seems to be certain people on here are very tetchy about things that aren’t relevant to the rest of us! More important things to get so worked up over! Don’t see what Andrew/Nelson have said myself that is sooooo offensive. Perhaps take a chill pill Doreen or maybe just don’t read comments on here?

  68. Many of the arguments put forward in favour of private rentals are based on saying it is a unique situation in the Canaries and arises from a corrupt government. I have been trying to point out that if you want to be taken seriously then it is necessary to understand that this is not unique – many other places have such bans and the more I research, the more I find where it exists – Westminister, New York, Paris, Hamburg, Singapore … Many of the new laws in these cities are brought about as a reaction to complaints from neighbours claiming they are disturbed by holidaymakers, or because there is a crackdown on tax evasion and of course, hotels in these cities see private rentals as unfair competiton.

    We have heard much that the solution exists and it is the “Portugese model”, but I wonder how many have actually done any research about this … it seems it was chaotic when introduced in 2008 with each local council being responsible for licences, uncertainly reigned as to what was required … and now it appears that many have not actually even applied and continue to rent out illegally. If you are going to propose any solution, it needs to be shown to be workable (particularly in these days of drastic cuts in local Town Halls)

    There is the added problem, that in the Canaries, from 1995, deeds of properties have specific provisions in them, allowing them to be Touristic or Residential and many Touristic ones have very restrictive clauses as to their use, but estate agents (and lawyers too) have often failed to explain this to purchasers. Of course, added confusion has come about because very few were fined under the law until the major clampdown in late 2010. Whether now there can be sweeping changes in what is permitted even though property deeds restrict various uses is a debate indeed for Lawyers and Courts of Appeal who would be kept very busy by claims from owners to adhere to the legal provisions actually in their property deeds.

    Making constant references to a delicate period in Spanish history will win few arguments or friends for the cause.

  69. Janet, thanks for your advice on all this and I like the new Q & A page. You referred earlier (11 July in reply to me) to the Spanish model of joint ownership, or condominiums. Do you or anyone on here know of any Spanish models of this? I did a little bit of research on the net and all I can find are groups of owners who have purchased a luxury villa and who divide up the weeks of use, etc. OR the concept of joint ownership in relation to a complex where there is an owners association. But in relation to a touristic complex where the owners would be joint owners with the management, along the US condo hotel model, I can’t find anything.

    Surely the complex would have to be a condo hotel from the start, with owners who bought only doing so in the knowledge that it is a joint ownership situation?

    Surely those who bought as full owners on an existing touristic complex cannot be told they are going to be joint owners with someone else (i.e. the sole agent or hotel agent)?

    If this happens, is anyone prepared to represent owners’ rights?

    In relation to the new law coming out, I believe there is a window of opportunity to make submissions on behalf of owners and their rights.

    Alotca are one step ahead of the game in campaigning to reform the laws governing sole agents. What aspects of the sole agent system are Alotca asking to have changed? Could this tie in with a list of owners’ requirements in the event of a change to joint ownership?

  70. Author

    Condo for the Spanish simply means joint ownership, and I understand it in the context of plain apartment blocks, so it’s not possible to know how they intend it to be meant in terms of touristic complexes, I’m afraid. And although we could try to second-guess it, it makes sense really to wait until we have something firm to work with.

    As far as what aspects of the sole agent system, our overriding issue was the abuse that so many suffer under the system. Yes there are good ones, but the fact that so many are not indicates that the system itself is flawed. We wanted negotiation on the matter so that we could discuss possibilities, and when they finally talked to us, they said that the matter was indeed being dealt with in the new legislation … but all we were given was that it involved shares and condominiums …

    (Thanks for the kind comments about the advice and the new page).

  71. The hypothetical condominium system might mean that owners would have to share with the agent all type of legal responsibility that simple registered owners nowadays don’t. I know of some exploitation companies which have gone bankrupt and a particular one that is at present exploited by a society formed by most owners (not all) after the previous agent disappeared. The possible future problem for owners if things go wrong is that it would be risky for them to afford severance pay, compensation, indemnities or whatever may come before and after the closure. I know of a specific company whose properties in the complex (reception, restaurant, employees’ rooms, discotheque, etc.) have been seized by a group of employees who never received the money they should have been paid after the closure. As a result of an endless lawsuit between old agent and old employees, the apartment owners haven’t been able to look for a new agent to exploit their apartments, most of which now are individually rented long term.

  72. I have read this thread with interest. However I have a question slightly different to that already covered. Where do you stand if you were sold an apartment in the Canary Islands to live in permanately not renting out or letting at all, believing and told it was residencial but it turns out to be touristic because the usage was never officially changed? Any comments or advise greatfully recieved.

  73. Author

    You can continue to live in it without problem, though it’s possible under the new law that at some point you might be under obgliation to “renovate”.

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