BRUSSELS: Airbnb and other short-term home rental companies are set to face more restrictions as the European Commission on Wednesday proposed rules to help authorities tackle a housing crunch in tourism hotspots. The move by the EU executive aims to harmonise rules across Europe after authorities in cities including Paris, Barcelona and Venice turned to a raft of diverse rules to crack down on Airbnb, which subsequently triggered legal challenges. The shortage of affordable housing due to the surge in short-term holiday rentals has prompted residents, especially young Europeans, to take to the streets to protest.

"A year ago, I promised to tackle Europe's housing affordability," Commission President Ursula von der Leyen said in a statement. "Today, we are taking one step in this direction. By providing more clarity and support to local authorities and communities, anchored in local realities," she said.

The proposal, which will need to be agreed with EU countries and the European Parliament in the coming months before it can become law, provides a first-ever common European framework for assessing housing measures.

The Commission said authorities can identify areas with a housing squeeze by checking whether the price-to-income level is high or if there has been an upward trend for the past 10 years, confirming a crunch. It said any subsequent restrictions against short-term rental must be based on evidence, necessary and limited to the affected areas, and not be retroactive. Lobbying group CCIA Europe, whose members include Airbnb, said the proposal fails to address the need for independent scrutiny of restrictions or effective redress.