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Airbnb Inc said it reached an agreement with New York City on Friday that resolved a lawsuit that the company brought that challenged a new law it said could expose it to substantial penalties for the advertising of short-term rentals of apartments.
Airbnb in October filed a suit after the state of New York enacted a new measure that imposed fines of as much as $7500 on hosts that advertise short-term rentals that are illegal on such platforms as Airbnb.
Airbnb contended that the ambiguous wording in the law could allow authorities in New York to apply it as well to online platforms such as itself that host listings of third parties, creating risk of significant proportions for both criminal liability and civil penalties.
Under the settlement’s terms, the city of New York agreed that its law would not be enforceable against Airbnb and would instead be aimed at the individual violators said a New York Mayor’s office spokesperson.
Airbnb is based in San Francisco and said via a prepared statement that it saw this new agreement as a big step forward for hosts on its site, with both sides to be cooperative on the ways needed to address the housing shortage in New York City.
Airbnb added that it looked forward to using the agreement as the basis to finding a new approach to protecting responsible New Yorkers and cracking down on the illegal hotels that take off permanent housing from the market or make unsafe spaces.
This deal comes after a settlement earlier between Airbnb and an official of the attorney general of the state of New York, who agreed to refrain from taking action to enforce that law, saying that an express provision states the city would carry out enforcement.
This lawsuit arrived amidst the ongoing battles between the lodging services offered online and public officials looking to lower the impact of rentals that are short term on urban and neighborhood housing markets.
Airbnb has argued that it has not legal responsibility for how the landlords use its online platform. If it were to be required to enforce the local laws pertaining to rentals that are short term, it could reduce dramatically the listing in some of its largest markets, said a company spokesperson.