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European Commission clarifies rules on the collaborative economy

The new and fast-growing collaborative economy is based on individual citizens and businesses sharing assets, services and skills via online platforms. It has the potential to increase services' efficiency, transparency, range and convenience in the European Union, while reducing costs for consumers

Fri Jun 3 2016 - 06:00

It has blurred the lines between consumers and providers, businesses and individuals, and platforms and end-service providers. This has led to some uncertainty about which laws apply to it and how.

On Thursday 2 June, the European Commission provided guidance to Member States and market operators on how EU rules apply to the collaborative economy, along with policy recommendations.

What benefits does the collaborative economy bring?

Photograph: Associated Press - Kenishirotie

The collaborative economy enables citizens and businesses to offer and use services and share assets via online platforms. From sharing houses or car journeys, to new types of cleaning and gardening businesses: collaborative services are widely offered via online platforms today. In fact, more than half of EU citizens are aware of the collaborative economy or have benefitted from it.

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Consumers enjoy greater convenience and choice, often at lower prices, and the collaborative economy encourages more asset-sharing, which supports the EU’s sustainability agenda. Especially important potential benefits include economic growth and new job opportunities.

What is the challenge?

Generally, Member States have in place legislation applicable to the sectors where the collaborative economy providers are active, which were adopted well before the start of the collaborative economy. Such rules may not fit the nature of the collaborative economy.

Some public authorities have tried to accommodate the collaborative economy by, for instance, designing specific legislation. Others decided to ban or restrict certain collaborative economy business models. Such divergent approaches create a risk of regulatory fragmentation across the Single Market.

This new Communication helps clarify EU rules and includes guidelines on how existing law should be applied, when it comes to, for example, market access requirements, consumer protection, liability issues, or employment practices. The Communication also makes policy recommendations to encourage Member States to promote the balanced development of the collaborative economy in Europe.

Read the full announcement on europa.eu

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