When I had Orioles season tickets, I was glad to have access to an electronic platform that would allow me to get rid of most of my unwanted tickets. Over the course of a season, I could get the seats for the games I did want, hedge my bet for playoff tickets, and subsidize those great seats by sharing my seats with others for a reasonable return.
Peer-to-peer sharing services are not limited to sports tickets, obviously. Services like Airbnb, Snapgoods, DogVacay, RelayRides, TaskRabbit, and Zaarly are based on the underlying premise that market forces will support an economy of sharers. Consumers will enjoy the benefits of local goods and services; service providers will enjoy the benefit of exploiting opportunities created by surplus time or personal product inventory; platform operators will use technology to make this economy run and take advantage of the sheer volume of these small, everyday transactions.
And, yet, with this growth and potential, questions arise about how this economy is or should be regulated. The FTC is going to hold a workshop on June 9, 2015, on this very topic. The workshop will seek to examine competition, consumer protection, and economic issues raised by the proliferation of online and mobile peer-to-peer business platforms in the new so-called “sharing economy.” According to the FTC press release regarding the workshop, sharing economy transactions reached an estimated value of $26 billion globally in 2013, and some estimates predict that the sharing economy will generate as much as $110 billion annually in the near future.
This sharing-economy workshop, to be held in Washington, D.C., will focus on questions like:
- How can state and local regulators meet legitimate regulatory goals (such as protecting consumers, and promoting public health and safety) in connection with their oversight of sharing economy platforms and business models, without also restraining competition or hindering innovation?
- How have sharing economy platforms affected competition, innovation, consumer choice, and platform participants in the sectors in which they operate? How might they in the future?
- What consumer protection issues—including privacy and data security, online reviews and disclosures, and claims about earnings and costs—do these platforms raise, and who is responsible for addressing these issues?
- What particular concerns or issues do sharing economy transactions raise regarding the protection of platform participants? What responsibility does a sharing economy platform bear for consumer injury arising from transactions undertaken through the platform?
- How effective are reputation systems and other trust mechanisms, such as the vetting of sellers, insurance coverage, or complaint procedures, in encouraging consumers and suppliers to do business on sharing economy platforms?
In the Commission’s press release announcing the workshop, Chairwoman Edith Ramirez stated, “Through our workshop, we want to better understand the competitive impact of these new business models, as well as their interactions with existing regulatory frameworks.”
Thus, those who operate in or around the sharing economy, including those who handle payments for those services, may be interested in either attending or following the FTC’s line of inquiry to understand the regulatory issues that may arise in relation to both competition and consumer protection law. Comments intended for discussion at the workshop will be accepted on or before May 26, 2015, but the record will be held open to receive comments until August 4, 2015. Comments can be submitted online. The workshop will be held in the FTC’s Constitution Center offices in the A, B and C conference rooms located at 400 7th Street, SW, Washington, D.C. The workshop is free and open to the public