Since 2021, the Centre for Competition Policy (CCP) has undertaken an extended project on regulatory sandboxes to develop data and produce research while helping to transfer knowledge to business and regulators. Regulatory sandboxes merit such research focus as a tool to promote regulatory flexibility in periods of rapid structural and technical change. This portal provides general resources on regulatory sandboxes and provides resources from this extended CCP project. The portal shares a unique and extensive data set of regulatory sandboxes, a working paper that has been developed in this project, a case study and general resources.
Regulatory Sandbox Database
Almost 200 regulatory sandboxes have been systematically identified through 2021. Each sandbox, was further detailed and coded for a variety of variables. This dataset is being made available for broad research use, as an annex to the first working paper produced within this project. It can be used for non-profit purposes with due attribution ‘S. Ennis, B. Enstone, R. Markellos and D. Psychoyios (2023) “What do we know about regulatory sandboxes” CCP Working Paper, University of East Anglia.’ (Github link coming soon)
Working Paper
Worldwide Adoption of Regulatory Sandboxes: Drivers, Constraints and Policies
Regulatory sandboxes are becoming a valuable tool for promoting innovation in sectors such as finance, energy, telecommunications, and health. We analyse 199 cases across 92 countries to understand the dynamics of worldwide adoption. Results show significant geographical concentration, with three countries (USA, Singapore, UK) accounting for a quarter of all sandboxes. We find that economic development and legal traditions are both strongly associated with sandbox adoption. Although regulated industries and innovation are critical for poverty reduction and growth, regulatory sandboxes are unfortunately exceedingly rare in developing countries. We use Laffont’s theory of regulation to draw recommendations on how developing countries could be supported in order to bridge this innovation gap.
Case study: The HEDNO sandbox
Three members of the research team (Ennis, Enstone, Markellos) undertook a funded research project on innovation strategies and tools for the Hellenic Electricity Distribution Network Operator (HEDNO) in Greece between 2021 and 2022. HEDNO provides electricity distribution services in Greece to more than 7 million households and businesses. The majority (51%) is owned by the state with the remainder belonging to private investors. The company is responsible for electricity distribution throughout the country, with regulated annual revenues of around €770 million.
One of the proposals that came out of the HEDNO research project was the development of an electricity regulated sandbox in Greece, which would directly benefit the wider energy innovation ecosystem. This proposal was the result of an international best practice analysis, a summary of which is reported in the present paper. The proposal and underlying research where then presented to the Hellenic Regulatory Authority for Energy (RAE) in order to explore the possibility that they develop the sandbox as in other countries. The response of RAE was very positive, and it was agreed that this could be developed by them in the medium to long term. This could not be implemented immediately given other strategic priorities and pressures on staffing.
Given the circumstances, the research team collaborated with RAE and the vice-president Psychoyios on the design of a hybrid sandbox that combines the best of both worlds: regulator and private sector. It was decided that such a corporate-led regulatory sandbox would be launched by HEDNO with the regulator acting as a passive observer to start with. Although this sandbox would not offer explicit regulatory concessions, its activities would benefit from feedback by the regulator, and the company in question does have various functions of overseeing standards that can require variation over time, with new technologies.
Resources
We here provide links to other sources of information on regulatory sandboxes:
FCA Regulatory sandbox lessons learned (2017)
European Parliament (2020) Regulatory Sandboxes and Innovation Hubs for FinTech
OECD (2020) The role of sandboxes in promoting flexibility and innovation in the digital age
World Bank (2020) How to Build a Regulatory Sandbox - a Practical Guide for Policymakers
European Commission (2023) Study on Regulatory Sandboxes in the Energy Sector