On 14 September 2017, the Rafael del Pino Foundation organised a meeting with the aim of discussing, with objectivity and rigour, the competition and regulation of collaborative economy platforms. The event was attended by the directors of the Foundation's Economic Analysis of Law Programme, held at the John M. Olin Center for Law at Harvard University -Francisco Cabrillo, Professor of Applied Economics at the Complutense University of Madrid, and Amadeo Petitbò, former president of the Court for the Defence of Competition-, together with the jurist Juan José Montero, director of the collective work "The Regulation of the Collaborative Economy".
Competition and regulation of sharing economy platforms
Francisco Cabrillo, Amadeo Petitbò and Juan José Montero
On 14 September 2017, a dialogue on competition and regulation of collaborative economy platforms was held at the Rafael del Pino Foundation. The first intervention was given by Rocío Albert, professor of Economics at the Complutense University of Madrid, who pointed out that the collaborative economy is a new model that has come to replace others, for which it is necessary to seek regulation and modify the existing one. According to him, when there was no collaborative economy, there was a problem of information asymmetry. So, as these models had to be used, but there was no way of checking the quality of the goods and services offered, whether things worked or not, regulation had to be established. This information asymmetry also extended to prices. Digitalisation, however, has transformed everything and solved the problem of market failures related to information asymmetry. Therefore, existing regulation is no longer valid either for new or previously existing productive sectors. Platforms have pulverised transaction costs, so that regulation has lost much of its meaning. What needs to be done, therefore, is to regulate those elements where the market cannot, such as taxation or consumer issues. It is not a question of eliminating regulation, but of adapting it, because what justified it has changed. The best thing to do is to seek flexible regulation to accommodate the arrival of platforms. This was followed by Antonio Maudes, former director of the Department for the Promotion of Competition at the CNMC and commercial technician and State economist, who warned that we have to assume that the change we are experiencing has repercussions on efficiency and on ways of negotiating. Platforms allow massive use of underutilised assets, as well as trust relationships between human beings. This affects all sectors of the economy and has direct implications for financing, efficiency, etc. It also affects the public sector as regulator, taxation responsibilities, etc. Regulatory development must be horizontal and sectoral, in order to allow the incumbent operator to adapt to the new technology, as opposed to the current inefficient regulation. Regulatory adaptation must be carried out on the basis of the principles of efficient regulation. For his part, Mateo Silos, Deputy Director of Economic Analysis of the National Commission for Markets and Competition (CNMC), presented the report prepared by the CNMC on the harm caused to consumers by the current taxi regulations. In the case of the city of Malaga, this damage can be quantified at 4.4 million euros per year. In Cordoba it amounts to 2.5 million. At a national level, it amounts to 324.3 million euros per year, which implies an extra cost of 13.1%. These estimates, as he explained, are conservative because it was not possible to incorporate the losses derived from waiting times and dynamic costs. Finally, Juan José Montero, Professor of Administrative Law at the UNED and director of the collective work "La regulación de la economía colaborativa", stressed that digitalisation entails network effects, efficiency, lower transaction costs, but also negative externalities related, for example, to accommodation, transport or the world of work. From these negative externalities, a more conservative reaction is identified, which seeks to consider platforms as service providers, implying that there is both an underlying service and an employment relationship. This reaction does not allow the full benefits of digitalisation to be extracted. Platforms are in fact an alternative and dynamic framework that enables the intermediation of specific services: they facilitate contracting between third parties and do so electronically. The European directive on information society services should therefore apply to them. Moreover, the final legal regime has to allow for digitisation and efficiency gains by introducing elements of protection in the commercial regulation of mediation contracts.
The Rafael del Pino Foundation is not responsible for the comments, opinions or statements made by the people who participate in its activities and which are expressed as a result of their inalienable right to freedom of expression and under their sole responsibility. The contents included in the summary of this conference, written for the Rafael del Pino Foundation by Professor Emilio González, are the result of the debates held at the meeting held for this purpose at the Foundation and are the responsibility of the authors.
The Rafael del Pino Foundation is not responsible for any comments, opinions or statements made by third parties. In this respect, the FRP is not obliged to monitor the views expressed by such third parties who participate in its activities and which are expressed as a result of their inalienable right to freedom of expression and under their own responsibility. The contents included in the summary of this conference, written for the Rafael del Pino Foundation by Professor Emilio J. González, are the result of the discussions that took place during the conference organised for this purpose at the Foundation and are the sole responsibility of its authors.