UK government launches review of the sharing economy

George Osborne highlights effect of new technologies as review launches into economic and social potential

The government has launched a review of the “sharing economy” to evaluate the economic potential and social implications created by people sharing products and services through the web.

The review is intended to look at the impact of services such as Airbnb, which allows people to rent out homes or rooms, or BlaBlaCar, used for car journey sharing.

In his speech to the Conservative Party conference, chancellor of the exchequer George Osborne highlighted the need to understand the potential effect of disruptive technologies.

"Every single day new technologies, new companies and new economies are fundamentally shaking up the established way of doing things," he said.

"It’s never been easier for thousands to start their own business in Britain, and reach the whole world. But a single app can appear overnight and disrupt an entire industry. 

"It can be exciting – but unsettling too. For this technology brings intense competition that spells rapid decline for any sector, or any country, that fails to keep up. These are big questions that require big answers."

The consultation has been initiated by the Department for Business, Innovation and Skills and will be led by Debbie Wosskow, CEO of online home-swapping service Love Home Swap.

“Over the next few months I will be exploring the social and economic potential of the sharing economy in the UK, and making recommendations on how this potential can be reached. I will also be considering any risks to consumers, or established businesses outside the sharing economy,” said Wosskow.

“I am keen to hear a wide range of views to feed into my review, including from users and potential users of sharing economy services, businesses operating in the sharing economy, and established businesses that are not part of the sharing economy,” she said.

The consultation will look at existing services such as home or business rentals, transport sharing and personal-time sharing, as well as emerging areas including fashion, food and personal items.

The terms of reference for the review said: “Collaborative businesses such as Airbnb and TaskRabbit are growing the sharing economy – peer-to-peer marketplaces that allow people to share possessions, time and skills. These new and varied business models are attracting significant publicity and investment across a wide range of sectors.”

Wosskow is calling for evidence to be submitted to the consultation before 28 October 2014, and will report on her findings by December.

The sharing economy has already caused controversy in some countries. In the US, hotel firms have complained that Airbnb allows people to avoid paying taxes on renting properties, as well as circumventing the rules and regulations to which they are forced to adhere. Taxi hailing app Uber has led to protests by taxi drivers in London and elsewhere about unlicensed cab drivers unfairly competing with regulated providers.

The UK government hopes that a better understanding of the implications of the sharing economy will help to create an environment that is more attractive for companies launching such services to base themselves in the UK.

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