Many of us agree that we must pool our resources. Owning a car is a major investment. Despite this, the vast majority of privately owned cars stand still 95 per cent of the time. At the same time, many people need to move around. With the advent of the sharing economy and digitization, there are now services whereby individuals can rent out their car to others when they do not need it themselves.
But it is not quite as straight-forward as it sounds. The regulatory framework is adapted to a time when car rentals were all about large corporations renting out their car fleet and it simply has not kept up with technological developments.
“According to the legislation, vehicles used for professional car rental services must have a special registration,” says Maria Schnurr, senior researcher at the state-owned research institute RISE, which heads up and supports innovation processes.
Easier in Norway
“At the same time, there are no definitions for professional and private car rentals. In Norway, for example, there is a much clearer framework for private individuals who want to share their car with other people, in terms of both regulations and taxation.
The regulatory framework also poses problems for new business models.
“Volvo and Hertz, for example, have a pilot project in which owners of Volvo cars who are going on holiday can leave their vehicle with Hertz whilst they are away,” Maria Schnurr explains.
“This means the individual can avoid paying for long-term parking whilst Hertz gains access to an extra car. But with current regulations, this kind of activity falls into a grey area.
The fact that the regulations no longer corresponded to the demands of reality was a problem which the Swedish Tax Agency, the Swedish Transport Agency and RISE had noted. At the same time, it was difficult for any of them to do something about the problem, and they realised that it would also be necessary to learn more about the new business models. It was therefore decided that new approaches for regulatory innovation would be tested, with inspiration from policy labs carried out in other European countries.
“It’s not about doing away with democratic principles; it’s about being able to update the regulatory framework through collaboration, creative methods and agile approaches so that the policy development follows the technological development,” says Maria Schnurr.
The meeting format was an eye-opener
RISE assumed leadership and began with separate discussions with various stakeholders in order to gather all perspectives. Different creative methods in design thinking were then used to identify the problems and find new solutions. These were then incorporated in a workshop with all actors involved.
“Companies and authorities alike appreciated being able to actually meet and learn about each other’s perspectives. For the Swedish Tax Agency, for example, it was important to hear from the intermediaries that they want to encourage their customers to report their revenues but that it becomes very difficult when there is a lack of information from the agency itself.
As a result of these interactions, a number of solutions were proposed. Some short-term solutions, such as the Tax Agency now enabling individuals sharing their car to deduct environmental costs, have already been introduced. But even more long-term proposals which must be taken to the next political levelhave been developed. But these are not the only outcomes.
“Working with policy development in this way is an eye-opener for companies and authorities alike; realising that those who might be perceived as opponents are in reality very open to cooperation. Several bilateral collaboration projects have emerged from our work together, and I believe that what will be most noticeable in the long term is that we have created a new arena for cooperation.”