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​Brazil debates sharing economy regulations

The goal is to create a framework for operation of new services without killing off the traditional economy.

The Brazilian government is looking to find ways to regulate new services coming up under the collaborative economy umbrella.

Given the impact on traditional services caused by alternatives such as Uber and Airbnb, the Lower House of the Congress created a special group to discuss the creation of a legal framework for the new services.

The first session of the special group took place yesterday (30). Over a four-month period, the theme will be debated in public hearings with representatives of the public and private sectors, representatives of the civil society and academia.

According to the leader of the special group, congressman Thiago Peixoto, the goal is to come up with recommendations to propose regulations across the various segments of the sharing economy - from ridesharing to crowdfunding - which do not restrict new businesses too much but also do not impact the traditional economy.

The lack of regulations is a major challenge for sharing economy businesses worldwide as they forced to comply with rules that were in place when such companies and technologies could not have been imagined. At the same time, a loose framework that protects consumers in case of legal issues with providers is needed.

Over-regulation could also stifle the development of disruptive ventures, since it could restrict new circumstances for them to exploit or gaps for them to fill.

Just as in many other countries, the challenge for the Brazilian government is to define if businesses operating under the sharing economy model should be subject to the same rules as other businesses within a similar industry, if they should be completely unregulated - or if they should fall somewhere in the middle.

Brazil has already paved the way in terms of Internet regulations a few years ago with the Marco Civil da Internet, a set of guidelines covering a few key areas of online governance broadly, which allows room for some self-regulation. The country is also defining its first national digital strategy.

If Brazilian lawmakers will now be able to understand that society is evolving fast and that frameworks should allow new companies to innovate, thus creating more favorable conditions for entrepreneurs to operate, it remains to be seen.