BRUSSELS The European Union executive threw its weight behind the "sharing economy" on Thursday, saying governments should only ban services such as ride-hailing app Uber [UBER.UL] and Airbnb as a last resort.
In new guidelines intended to foster development of the new Internet-based services in Europe, the European Commission said any restrictions on them by EU member states should be proportionate to the public interest at stake, such as public safety or social policy.
Although not legally binding, the guidelines are an attempt to set a Europe-wide approach to the fast-growing sector instead of the patchwork response adopted by European cities so far.
Some European cities have responded with curbs and bans on companies like Uber and home-sharing site Airbnb which challenge traditional industries such as taxi services and hotels, drawing complaints of unfair competition.
"Absolute bans and quantitative restrictions should only be used as a measure of last resort," the Commission said in a statement.
The guidelines were welcomed by Airbnb, which called them "a valuable tool to ensure a clear, stable and consistent regulatory environment for sharing economy users across Europe."
The Commission said it would use the guidelines to ensure that any national legislation does not violate the EU treaties, a veiled threat to any government seeking to impose overly restrictive measures on the sharing economy.
Uber said the guidelines were an encouraging sign.
"The European Commission has made it clear that EU laws protect collaborative economy services against undue restrictions, and member states should review regulations that undermine the development of such services," said Gareth Mead, Uber spokesman.
The Commission is assessing complaints from Uber against France, Germany and Spain.
"Limiting the possibility for new transport operators to use new technologies, such as geo-localisation services, is one clear example of bad practices," said EU Transport Commissioner Violeta Bulc.
"Some restrictions could run contrary to EU law and the Commission might have to take action."
The Commission also wants to foster European sharing-economy start-ups. Commission Vice-President Jyrki Katainen said the sector could produce Europe's next unicorn, or start-up company valued at more than $1 billion.
"Our role is to encourage a regulatory environment that allows new business models to develop while protecting consumers and ensuring fair taxation and employment conditions," he said.
U.S. firms Airbnb, founded in 2008, and Uber, launched a year later, have faced regulatory battles around the world.
Taxi drivers have staged high-profile protests against Uber in many European countries. Last year, French prosecutors raided Uber's Paris offices in a showdown over whether the company was violating a law to curtail online taxi services.
Airbnb has faced criticism from city officials in Barcelona and Paris, who say it has driven up property rents.
In the case of room-renting sites like Airbnb, the Commission said banning short-term lets of apartments "appears difficult to justify" when limits on the maximum number of days apartments can be rented out would be more appropriate.
The Commission said sharing economy companies should not be subject to additional sector-specific rules - for example hotel and taxi regulations - unless they own assets and set the final price. However, they should pay taxes like other service providers.
(Editing by Barbara Lewis and Adrian Croft)