Supreme Court to Hear Appeal on Independent Rental Rights for Canary Islands Property Owners

The Supreme Court in Spain has agreed to hear a landmark appeal that could determine whether apartment and bungalow owners in the Canary Islands are legally allowed to rent out their properties independently, without being obliged to operate under a tourist complex management company or reception. This case has significant implications for property owners who wish to engage in short-term rentals, a popular practice in the region.

Background of the Case

The case stems from a ruling by the Canary Islands High Court (TSJC) in March 2025, which prohibited a property owner in the Maspalomas Tisalaya complex (San Bartolomé de Tirajana) from continuing to rent their bungalow as a holiday home. The TSJC upheld the “principle of unified management” established under Canary Islands tourism law, which requires all properties within a registered tourist complex to be operated jointly under a single licensed manager, known as an exploitation company.

The court argued that while this rule limits the free provision of services, it is legally justified as a means of ensuring professional management and high-quality tourism standards, offering greater protection to consumers. The ruling reflects a broader trend in tourism regulation, where authorities seek to balance the interests of property owners with the need for consumer protection and quality assurance in the hospitality sector.

Challenging the Unified Management Principle

However, the owner has challenged the ruling before the Supreme Court, claiming there is no legal justification to restrict individual holiday rentals within tourist-designated zones or complexes. The appeal argues that the principle of unified management unfairly excludes property owners from the short-term rental market and violates EU and Spanish laws on free competition and service provision. This challenge raises important questions about property rights and the extent of governmental regulation in the tourism sector.

The Supreme Court’s Administrative Chamber has admitted the appeal, declaring that the issue holds “objective legal interest for the formation of jurisprudence.” The court will examine whether the principle of unified management in the Canary Islands’ Tourism Law 7/1995 represents an unjustified limitation on the freedom to provide services, or whether it is lawfully justified in the public interest. This examination will involve a careful interpretation of several key legal provisions, including Article 5 of Spain’s Market Unity Act (Law 20/2013), Article 3.11 of the Services Act (Law 17/2009), and EU Directive 123/2006/EC on services in the internal market.

Reactions from Property Owners

Property owners have hailed the decision as a breakthrough. The Platform of Those Affected by the Tourism Law (PALT) welcomed the court’s decision, calling it “a step forward in questioning the use of the unified management principle as a tool to persecute legitimate property owners.” This sentiment reflects a growing frustration among individual property owners who feel marginalized by regulations that favor large management companies.

PALT argues that the system, originally designed to professionalize the extra-hotel accommodation sector, now serves mainly to restrict ownership rights and force private owners into collective management schemes, even when their complexes lack an active operator. This has led to a situation where many property owners feel they are being unfairly treated, as they are unable to capitalize on their investments in the way they see fit.

“These are not hotels,” the group stated. “They are privately owned properties, and the model that obliges owners to hand over their homes to a single operator has its days numbered.” This statement encapsulates the frustration felt by many in the community, as they seek to reclaim their rights to manage their properties independently.

The Supreme Court’s ruling, expected to set a precedent for thousands of similar cases in Gran Canaria, Tenerife, Fuerteventura, and Lanzarote, could redefine the balance between private property rights and tourism regulation across the Canary Islands. The outcome of this case may not only impact individual property owners but could also influence the broader landscape of tourism management in the region, potentially leading to a shift in how rental properties are regulated.

Key Points

• The Supreme Court in Spain will hear an appeal regarding rental rights for property owners in the Canary Islands.
• The case originates from a ruling by the Canary Islands High Court in March 2025.
• The TSJC upheld a principle requiring unified management of properties within tourist complexes.
• The property owner argues this principle restricts individual holiday rentals and violates competition laws.
• The Supreme Court’s Administrative Chamber has admitted the appeal for its legal significance.
• The ruling could impact thousands of similar cases across the Canary Islands.
• The Platform of Those Affected by the Tourism Law supports the appeal, claiming it protects property owners’ rights.