Posted by: Ray Brescia | December 20, 2017

Regulation and Innovation in the Sharing Economy

The highest court in the European Union has ruled that Uber should be treated like a transportation company and not a technology company.  This is good news for workers, particularly those who do not work for Uber, who face stiff competition from sharing economy companies that attempt to act under a different set of rules.  What this decision means is that Uber and other, similar companies will have to operate under those same rules.  For some, this ruling is welcome.  Others will be disappointed: those who might appreciate the often lower cost of such services that can be traced to the fact that these companies were operating under a different, and lighter, set of rules. By harmonizing the regulatory regimes covering these services, we are likely to see similar pricing schemes for ride hailing services in the EU between sharing economy platforms and more traditional providers.  Still others may lament that this harmonization may stifle innovation, as the regulatory regime that governs incumbent providers, if extended to sharing economy providers, will mean such companies may be less nimble, and less able to respond to evolving customer demands in light of, and driven by, emerging technologies.  The fight in the EU is just one of many happening throughout the world as sharing economy companies seek to operate free of many of the regulations that bind incumbent providers in different sectors.  It is through these regulatory battles that the proper contours of regulation will emerge.  Regulators, consumers, and providers will need to explore the intersection of innovation, consumer protection, worker rights, and market demand to find the right regulatory balance. For a deeper discussion of many of these themes, please read my piece in the Nebraska Law ReviewRegulating the Sharing Economy: New and Old Insights into an Oversight Regime for the Peer-to-Peer Economy, which is available here.


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