Regulatory Sandboxes: Ex Ante Regulation or Competition Policy?

This paper focuses on the relationship between EU Competition Law and ex ante regulation by specifically analyzing the case of regulatory sandboxes. It also provides some case studies of regulatory sandboxes and questions their impact of on the goals of promoting competition and innovation in the EU.

By Cristina Poncibò & Laura Zoboli^[1]

I. INTRODUCTION

The European Commission has adopted a clear strategy to promote competition in the digital services markets through a form of asymmetric, sector-specific regulation.^[2] In particular, it has recently adopted the Regulation of the European Parliament and of the Council for fair and contestable markets in the digital sector or Digital Market Act (“DMA”).^[3] With this legislation, the EU has clearly expressed a certain diffidence towards the laissez-faire approach in general and, in particular, towards the emergence of the digital economy, as the absence of public regulatory action was too risky in the long run for the proper functioning of the single market.^[4]

However, the choice to intervene through ex ante regulation also has some clear limitations with respect to the speed of technological innovation, as well as the risks of creating a burdensome and fragmented regulatory framework that ends up increasing in complexity and in implementation costs for companies and, ultimately, for citizens themselves.^[5]

The decision to resort to such an articulated form of regulation, which is difficult to enforce in the