Amsterdam city council has been forced to withdraw fines totalling €400,000 which officials have handed out to people breaking the rules on holiday rentals.

Last week, the highest Dutch court said the fines were illegal because they had been levied on the wrong grounds. Everyone renting their home to tourists should have a permit, and people can only be fined for not having one, the court said.

Last year Amsterdam said everyone who rented their home via platforms like Airbnb should register the rental period with the city. The aim is to ensure they do not break the 30 day maximum.

‘We are going to withdraw the fines. The reporting requirement is dead,’ housing alderman Laurens Ivens said during a debate in city hall on Wednesday. In total, the city has handed out 134 fines of €6,000. Half have been paid and will not be refunded, Ivens said.

The national government is working on its own rules to deal with holiday rentals and those will give councils the option of setting up a register. But that legislation is unlikely to come into effect before the summer, leaving landlords uncertain what to do next.

Ivens said he doubted the city could set up a licencing system quickly, given some 20,000 homes in the city are rented out via Airbnb. He has pledged to give more clarity about what action the council can take to limit holiday rentals next week.