This report summarises research on barriers to investment in innovation and whether opportunities are currently feasible or not in the collaborative economy, and in the area of green growth. For this purpose, multiple roundtable meetings have been organised and interviews have been held with entrepreneurs, academics, legal experts, representatives of companies and government, who are active in the field of the collaborative economy. This summary sets outs the priority aspects of the collaborative economy which require action.
The collaborative economy contributes to green growth, but its potential can be utilised better. This can be achieved by looking at the opportunities and barriers, which now exist because the difference between producers and consumers has become more blurred, as well as changing trends of consumers renting or sharing products rather than owning products. As a result new risks and questions arise concerning liability, taxation, and competition. This report suggests a role for the government in four areas: (1) to ensure that current legislation is clear in how it applies to the collaborative economy; (2) to provide regulatory flexibility for experiments; (3) to monitor relevant developments and safeguard the public interest; and (4) to address the barriers that have been identified in this research.
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Share nl report for the ministry of economic affairs on the innovation in the collaborative economy
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Report on the Innovation in the
Collaborative Economy
This report was conducted for the Ministry of Economic Affairs.
Summary
This report summarises research on barriers to investment in innovation and whether
opportunities are currently feasible or not in the collaborative economy, and in the
area of green growth. For this purpose, multiple roundtable meetings have been
organised and interviews have been held with entrepreneurs, academics, legal experts,
representatives of companies and government, who are active in the field of the
collaborative economy. This summary sets outs the priority aspects of the collaborative
economy which require action.
The collaborative economy contributes to green growth, but its potential can be
utilised better. This can be achieved by looking at the opportunities and barriers, which
now exist because the difference between producers and consumers has become more
blurred, as well as changing trends of consumers renting or sharing products rather
than owning products. As a result new risks and questions arise concerning liability,
taxation, and competition. This report suggests a role for the government in four areas:
(1) to ensure that current legislation is clear in how it applies to the collaborative
economy; (2) to provide regulatory flexibility for experiments; (3) to monitor relevant
developments and safeguard the public interest; and (4) to address the barriers that
have been identified in this research.
Defining the collaborative economy
The term ‘collaborative economy’ is often used to denote a wide range of “economic
systems of decentralized networks and marketplaces that unlock the value of
underused assets by matching needs and haves, in ways that bypass traditional
institutions”. This research focuses specifically on goods, energy, and transportation
markets – including the sharing of parking spaces – in the context of green growth.
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Priority areas for action
The traditional roles of, and relationships between, the government, businesses, and
the consumer are changing. The government has to deal with new types of businesses,
which also operate as digital platforms. These platforms allow a consumer to become a
producer with a click of the mouse. This ‘producing consumer’ is a direct competitor to
existing businesses. This leads to innovation as the incumbent businesses develop new
products and services, but there is also a risk of an uneven playing field between the
‘private supply’ being created by the producing consumers and the supply provided by
the incumbent business. This development can in the long term lead to shift of norms
in society from sole ownership to shared ownership and shared access to products.
The purpose of this report is to set out what action the government should take in
response to these trends.
The opportunities, barriers, and priority areas for action outlined in this report are
focused around the triangle formed by the government, consumers, and the business
community. Four categories that are of interest to the government are described
below, followed by developments in the market where government intervention is not
necessary:
1. Green growth and the collaborative economy
The collaborative economy results in a more efficient use of existing goods. As a result,
the collaborative economy in general has a positive impact on the environment.
Therefore, further growth of the collaborative economy is desirable. The government
can contribute in two ways to the growth of the collaborative economy. The first is to
raise awareness of the opportunities that the collaborative economy offers, by
providing information on and participating actively in the collaborative economy. To
achieve this, the government should record its spare capacity and unlock this internally
as well as externally on sharing platforms. The second is that sharing platforms could
be considered as part of the public procurement procedures as well as for individual
purchases.
2. Consumer interests
Issues such as liability, taxation, and competition are governed by laws and regulations
which differentiate between consumer and producer as well as private individual and
entrepreneur. The development of collaborative economy initiatives results in the
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blurring of the line between these traditional roles. As a result new questions have
arisen on these themes which need to be carefully considered, paying particular
attention to issues of public interest such as security, quality, and reliability. For this, it
is important to have clarity on the nature and scale of the collaborative economy
initiatives. It is then important to clarify and to communicate to the citizens active in
the collaborative economy, as currently they are often ignorant of their own risks and
responsibilities. For example, there is confusion as to whether to pay VAT.
3. Business interests
Enterprises from the collaborative economy, such as Airbnb and Snappcar, can often
be characterized as a “digital platform”. This requires a different approach from the
government. Traditionally businesses were regulated, as businesses were the owners
of the means of production and personnel used to create the “supply” of a good or
service; however, now enterprises are arising that possess no means of production but
simply bring together through digital means existing unmet supply and demand. This
raises all kinds of questions which are relevant to the government, for example, in the
field of liability if a transaction goes awry. It is difficult to estimate what fiscal and
judicial regimes are applicable to existing initiatives in the collaborative economy, and
what the consequences will be. A way to determine whether a different approach is
needed is to facilitate experimental “zones” which test different forms of regulation
and policy.
Market actors can apply these to determine whether they achieve the objectives of
existing regulation while operation in new, more appropriate, ways. A ‘classic’ example
is the taximeter, which may become redundant as a result of app and GPS technology.
Another example is the use of sharing platforms when executing public sector policies:
taxes can also be raised via these platforms. To provide clarity, the government could
open an information service for entrepreneurs on the legal and fiscal frameworks
which apply to these new forms of trade and business models. This will aid the
important task of connecting the terms that are being used in the collaborative
economy with the legal terms.
4. The market
In the different markets in which there are collaborative economy activities, an uneven
playing field can arise between the existing business-to-consumer supply and the new
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consumer-to-consumer supply facilitated by digital platforms. A real possibility of
unfair competition exists in various markets between these platforms and existing
businesses, for example, hotels and Airbnb. The government can guarantee a level
playing field with standardisation: by declaring explicitly that existing legislation is
applicable to new platforms. An alternative for standardisation is innovation: the
government can develop new standards in cooperation with market actors (i.e. new
digital platforms as well as existing businesses). These standards can be enforced
through, for example, permits.
Developments in the market
There is a need for cooperation within the market, for example, in the fields of
insurance, marketing, representation, and integration of services, such as platforms.
ShareNL, which as of 2013 functions as an independent knowledge and network
platform advises and provides guidance to businesses, start-ups, governments and
knowledge institutes. Several further initiatives and partnerships will shortly be
launched:
• An association of Dutch sharing platforms seeking to promote the interests of
its members.
• A country-wide ‘Sharing City’ platform where data from test projects in the field
of the collaborative economy and on behalf of different cities can be made
available. For participating departments, the Sharing City platform is a testing
ground for cases that can be used for shaping or amending legislation.
• The Green Deal Autodelen, which aims for 100,000 shared cars in the
Netherlands by 2018.
The cooperation gap will to a large extent be addressed by existing initiatives. The
government can also potentially accelerate the development of the collaborative
economy by amending existing initiatives aimed at cooperation.
This work is licensed under the Creative Commons Attribution-NoDerivatives 4.0
International License. To view a copy of this license, visit
http://creativecommons.org/licenses/by-nd/4.0/.