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Proposed new licensing scheme to level the playing field and improve the standard of visitor accommodation in Wales

Cynllun trwyddedu newydd arfaethedig i sicrhau tegwch a gwella safon llety ymwelwyr yng Nghymru

The Welsh Government has today launched a consultation on establishing a statutory licensing scheme for all visitor accommodation providers in Wales.

The primary aim is to establish a level playing field for all visitor accommodation businesses operating in the sector. The concern around the lack of a level playing field has been a long-standing area of discussion with concerns certain parts of the sector do not meet or comply with their statutory obligations.

The Welsh Government’s Co-operation Agreement with Plaid Cymru commits to a statutory licensing scheme for holiday lets as part of a package of measures to address the negative impact second homes and short-term holiday lets can have on the availability and affordability of housing for local people in our communities.

A statutory licensing scheme could:

  • provide the mechanism to address concerns on compliance
  • provide a comprehensive database of exactly who is operating in the industry as it is currently not possible to determine how many visitor accommodation businesses there are in Wales, or in any given community;
  • be a valuable tool in understanding the scale and nature of the sector.

Economy Minister, Vaughan Gething said: “The visitor economy is changing rapidly, and the role of visitor accommodation presents major challenges for communities across the world. For example, the growth of online booking platforms has brought many benefits, such as new routes to market and increased consumer choice. 

“However, we are aware of the concerns around compliance with existing requirements and the impact of short-term lets on housing stock and our communities.

“Our plans to develop statutory licensing scheme will be focused on levelling the playing field as part of a long-term response to the major challenges we face. 

“Over the course of the past year, we have been exploring and engaging with stakeholders on how such a scheme could work in Wales. As the consultation now opens, we would like to hear further views and would encourage the sector to respond to the consultation.”

Designated Member Siân Gwenllian said:

“Through our Co-operation Agreement, we are taking radical and immediate action to address housing market failures and the lack of affordable housing, using the planning, property and taxation systems to make a difference. This proposed licensing scheme is part of our approach, making it a requirement to obtain a licence to operate visitor accommodation, including short-term holiday lets.

"There has been a huge increase in the short-term holiday let sector in recent years which is exacerbating the housing crisis in Wales. While we have a regulatory framework in place in Wales for private rental accommodation, there isn’t one that covers all types of visitor accommodation. Our proposals will bring greater safeguards to local communities on the use of residential dwellings as short-term holiday lets in particular, whilst enhancing the visitor experience and visitor safety in Wales.”

The Consultation can be found here and responses are due by 17 March 2023


Notes to editors

  • The Programme for Government 2021 - 2026 includes a commitment to ‘consult on legislation permitting local authorities to raise a tourism levy’. Some type of registration system would be needed to facilitate the collection of the tourism levy.  The proposed statutory licensing scheme could be used to facilitate the collection of the levy and help ensure that there is accurate intelligence on all providers of visitor accommodation so that the levy can be applied fairly.
  • Visit Wales already operates both a quality grading scheme and verification scheme for visitor accommodation. Participation is voluntary, with different schemes for different types of accommodation. These schemes have been free to providers since 2021.
  • In the UK, different approaches have been taken by our neighbours and are at different stages of development. In Northern Ireland, tourist accommodation providers must receive certification by Tourism Northern Ireland in order to operate and this has been in place since 1992. The Scottish Government has recently put in place legislation requiring all short-term let hosts and operators to obtain a licence in order to operate, unless specifically excluded. Existing hosts and operators have until 1 October 2023 to apply for a licence.
  • In England, the Department for Digital, Culture, Media, and Sport recently closed a call for evidence on the potential introduction of a tourist accommodation registration scheme and the UK Government has now confirmed that it will legislate to introduce a registration scheme for short term lets through the Levelling Up and Regeneration Bill. There are other examples too, such as the compulsory schemes operated in the Isle of Man and Republic of Ireland