Innovation policy group, comprised of leading EU start-ups, produced an action driven report in support of the co-creation of European innovation ecosystem. Report identified key directions and flagship projects — among them a proposal to create a frictionless way for innovative companies to access the EU market as one common market, where testing innovations would be possible throughout Europe in a single, united manner.
European Union Commissioner for Innovation, Research, Culture, Education and Youth Mariya Gabriel and a group of 35 Europe’s most successful companies’ presented a comprehensive, action based report, called “Next Innovation EU”, detailing plans to make improvements to the unified European innovation ecosystem. Founders and CEOs proposed 8 flagship projects to be implemented in the coming years to give Europe the leadership in the future digital and sustainable world. Among them, a proposal by fintech startups for a pan-EU sandbox, enabling companies to test out new innovative products with a larger audience and scale efficiently.
The new report argues that the current EU market is fragmented with varied rules and regulations across each country, which leaves the EU behind competitors elsewhere, who can test the products faster, gain momentum and size, and eventually acquire European companies or compete more aggressively with them.
According to the report, a pan-EU sandbox, acting as a one-stop-shop for any company, would solve the problem since it would automatically enable businesses to offer innovative products and services throughout the entire EU (subject to conditions) once accepted into the framework.
“Europe needs a frictionless way for companies offering innovative services and products to access the EU market as one common market,” said Martins Valters, Co-Founder of Latvian startup Mintos, Europe’s leading marketplace for investing in loans.
“We need to make sure that new product ideas can be tested throughout Europe irrespective of where the company is located within the EU and do it really fast. Waiting for months or often more than a year to get approvals or feedback from a number of various regulators scattered in different countries in many cases might be a death sentence to innovative ideas. A pan-EU sandbox would allow both businesses and individuals in the EU enjoy much faster and unrestricted adoption of new innovative solutions.”
One of the prerequisites for the implementation of the sandbox is agreeing on the areas and industries in which innovative companies should have access to the pan-EU sandbox.
“As a minimum, these should be companies operating in the financial, technology, and transportation sectors,” said Mr Valters. “From the EU there should also be applicable legislation to the effect that individual EU Member States’ regulatory bodies do not have barriers for services provided by the company if a particular company is accepted in the pan-EU sandbox. Relevant trade associations should be both actively promoting this opportunity and assisting with helping the companies to apply for the pan-EU sandbox.”
According to the report, there are two ways to reach the goal. The first involves a central EU institution for each industry that accepts the company in the pan-EU sandbox. The other option would be that each Member States’ regulator could make the decision for acceptance, which would then be applicable for other Member States.