Home rental website Airbnb has agreed a truce in its battle with authorities in New York, clearing the way for a potential initial public offering.
The San Francisco-based company has struck a deal with regulators in the expectation that they will turn a blind eye to individuals who break local laws by renting their homes out on an ad hoc basis, and instead target people that are doing it on a large-scale, semi-professional basis.
New York attorney general Eric Schneiderman last year tried to subpoena records for everyone in the state who has let their homes through the service, in order to crack down on residents in New York City who may have been breaking the law.
He planned to take action against anyone flouting a New York City rule that bans short-term rentals when the primary resident isn’t home, and to ensure that people renting their apartments out are paying hotel taxes of up to 15% of their Airbnb rental income.
Aibnb fought a legal battle against the request for information, and won a partial victory last week when the US Supreme Court quashed Schneiderman’s request, saying that the subpoena was “overly broad” and that some of the information he had asked for was “irrelevant” to his enquiries.
However, the court also made it clear that it would accept a narrower subpoena from Scheiderman, which he lodged swiftly after the ruling.
Airbnb sidestepped the subpoena yesterday by handing over anonymised information about its users, and agreeing that the Attorney General can request further information about any suspicious activity for up to a year afterwards, The Telegraph reported.
David Hantman, Airbnb’s head of public policy, said that those requests for further information were likely to be “focused on large corporate property managers and hosts who take apartments off the market and disrupt communities”.
The company has said it will not go public this year. However, analysts expect an IPO sooner rather than later, after a $450 million funding round valued the business at $10 billion – more than InterContinental Hotels.