706 COMPETITION LAW IN TOURISM Thirdly, restrictions to commercial activity should be avoided unless strictly necessary to preserve an overriding reason in the public interest. Regulation needs to be adapted to the specific circumstances of the case, and this requires regulators to undertake case-by-case analyses. Fourthly, restrictions to commercial activity must be based on sound fact- and data-based analysis. Regulators should avoid restrictive regulation based on mere presumptions. Finally, regulation is not always an easy task. If regulators have concerns with an activity, they should try to find the least intrusive means to address them. 4. CONCLUSIONS Short-term housing rentals have dramatically increased in the last decade in Spain, largely due to the popularisation of digital platforms. This has been accompanied by a tremendous regulatory inflation, with all 17 Spanish regions, and the largest cities, legislating on the matter. In some cases, regulation introduced severe restrictions onto short-term housing rentals, based on alleged externalities of this activity. In this context, the CNMC has played an important role to ensure the quality of regulation. As an independent agency, it is part of the necessary checks-and- -balances of the public sector activity. Its advocacy helps mitigating unnecessary restrictions to competition that are detrimental to consumers and to social welfare. The CNMC has intervened where regulation was not well constructed, graduating the use of its advocacy tools to the seriousness of the situation. The CNMC has advocated the use of principles of efficient economic regulation, namely the need to justify the necessity and proportionality of restrictions imposed on commercial freedom. Thanks to the CNMC, unjustified restrictions to competition have been lifted, such as the prohibition to rentals of periods shorter than five days in Madrid, the prohibition to rent individual rooms in the Canary Islands or Castile and León, or the ban to market housing rentals in the touristic areas of the Canary Islands. Apart from these tangible wins, the advocacy activity of the CNMC has provided guidance to regulators and undoubtedly contributed to improving regulation.
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