Hosted Accommodation Australia Ltd (HAA) is warning businesses offering non-compliant accommodation that they face the risk of prosecution and hefty fines if they are operating illegally.

Councils, shires and territory governments across Australia are responsible for ensuring that local businesses are operating legally, but HAA is unaware of any steps being taken by these bodies to address this emerging problem.

HAA's Chairman, Ciaran Cryan, says that the trend for unregulated accommodation listings on popular websites is not only legally risky, but also bringing the high standards of the industry down.

"We are finding that health and safety regulations often go out the window with these properties. Australia has some of the most stringent legislation governing guest accommodation in the world. However, people who list their spare rooms on these websites may be unaware that they face prosecution if they are not following planning and food safety regulations and something goes wrong.

"It is also important to note that a normal household public liability insurance policy would become void if a claim was made involving a paying guest without the prior knowledge of insurance providers."

While websites such as airbnb.com and wimdu.com offer up to $1million compensation for physical damage to host businesses listed on their websites, there appears to be no compensation available to individual households to meet the costs of prosecution.   

Another concern among industry representatives is that income derived from an unregistered accommodation providers may not be properly dealt with for taxation purpose. Regulating this loophole, as with health and safety, may also prove difficult if properties are not registered.

"Without the correct regulatory framework or monitoring in place, there is no way that we can ensure guests are being hosted in line with industry standards and mandatory government legislation.  Not only is this a concern for customers, but also for the tourism industry as a whole," says Mr. Cryan.

Other countries are making an attempt to bring unregulated businesses into line. One of many news outlets to comment on New York's 'Illegal Hotels rules, NPR reported that 'Some Airbnb Listings Could Be Breaking the Law'. An online article on The Next Web titled Airbnb Could Be Banned describes how the Dutch are tracking down illegal hotels in a drive to eliminate them from Amsterdam.

Hosted Accommodation Australia is the national peak organisation representing owner operated, quality hosted accommodation including bed and breakfasts, farmstays and self contained cottages and houses.



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