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With New Mobility Trends and Ventures, European Officials Struggle to Balance Innovation and Regulation

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By Nicolas Zahn, Masters student at the Graduate Institute of International and Development Studies in Geneva

At the second World Collaborative Mobility Congress (Wocomoco), held May 7-8 in Bern, Switzerland, entrepreneurs and policymakers discussed over the two days their experiences and identified challenges ahead in reshaping mobility. Entrepreneurs are missing clear frameworks on the political side, while policymakers are calling on companies to better coordinate and collaborate with the public sector.

With citizens becoming ever more mobile and a trend toward urbanization, especially in developing countries, policymakers face tough times in managing a rapidly declining resource: space.

Major cities struggle with air pollution and traffic congestion, while at the same time facing budget constraints that limit the potential for massive infrastructure investment. "We need the private sector to innovate," said Ursula Wyss, a member of Bern's city council.

And the private sector is innovating. Following the trend toward a sharing economy where access is more important than ownership, startups that focus on collaboration and sharing in order to use resources more efficiently have been spreading around the globe. In particular, car-sharing services like Lyft, Uber and Sharoo, which just started business in Switzerland, have great potential in addressing the mobility needs of today's users and city planners. Car sharing has already been shown to reduce the number of cars, and participants at Wocomoco agreed in group discussions that car sharing and bike sharing will have a positive impact.

Uber user data in Zurich. Zurich is the only city in Switzerland that Uber has expanded to so far. Uber user data in Zurich. Zurich is the only city in Switzerland that Uber has expanded to so far. Image credit: Uber Zurich.

Yet while customers seem happy using these sharing services, officials and regulators, often in the aftermath of lobbying efforts by established players, are engaging in what The Economist has called a backlash against the sharing economy (paywall). The sharing idea adds a third player to the user and business duo: the participant.

Participants in the sharing economy are both producers and consumers, which leaves governments with questions such as how to tax those services and how to ensure their quality.

In this regard, Michael Glotz-Richter from the Senate of Bremen, Germany, explained that the city's car sharing requires participants to be certified in order to guarantee public safety. Other cities do not seem so tolerant: Brussels has effectively banned Uber from providing peer-to-peer car-sharing, a variant that is raising the most concern from politicians, and other European and American cities are discussing stricter regulations.

This behavior exemplifies the inherent tension for policymakers in balancing promotion of innovative solutions to challenges with regulations aimed at enforcing certain standards, such as public safety. Another problem in federalist countries such as Switzerland comes with the different levels of government. Should the national government take the lead or should states opt for local engagement? Roman Widmer from the Swiss Union of Cities and Towns said he thinks that municipal authorities will work with the private sector, as each city has individual mobility needs.

Entrepreneurs at Wocomoco also called on politicians to create coherent frameworks. Jannis Werner, legal counsel for WunderCar, a German-based peer-to-peer car-sharing company, said that reactions from politicians and regulators to the potential effects of car sharing are usually very positive, but that the political will to tackle legally gray areas is lacking.

Christian Piepenbrock from Nachbarschaftsauto, another German car-sharing initiative, also criticized the lack of coordination by policymakers and regulators. His company has received awards for innovation from one federal agency while at the same time facing hefty criticism from other federal agencies. To this end, the Swiss Union of Cities and Towns recently created a conference on mobility where officials from different cities can come together to discuss and coordinate their moves.

Alan Woodland, Executive Director of the CarSharing Association presents his views on regulatory challenges. Alan Woodland, Executive Director of the CarSharing Association presents his views on regulatory challenges. Credits: Student Reporter / Nicolas Zahn.

At Wocomoco it became clear that entrepreneurs and policymakers have to come together and sometimes have to force themselves to bite the bullet. "If we want to use public infrastructure, there is a price to pay," said Alan Woodland of the CarSharing Association, a U.S.-based industry group that promotes codes of conduct within the industry.

Governments, on the other hand, are watching closely what is happening around the world but need to speed up their efforts to keep pace with the private sector.

This story is part of the Urban Mobility in Switzerland coverage project and was originally published on studentreporter.org on 16th of May, 2014.