EU regulation opens up opportunities in the data economy
The EU is setting the ground rules for the reliable use of data to move towards an era of sustainable economy and digital leadership. Businesses, society and individuals need the knowledge and tools to be able to grasp the opportunities opened up by revised data regulation and reap the benefits of the data economy at the forefront.
What is it about?
The reform of data regulation builds on the European Commission’s European data strategy, published in February 2020. The policy aims to accelerate the building of a data-driven society and create a strong legal framework for data mobility in the European internal market so that fundamental rights are respected and (cyber)security is guaranteed. The Commission aims to increase the use of and demand for data-driven solutions in the EU’s internal market, while promoting the international spread of solutions based on European values.
The Commission has issued several legislative proposal that could form the building blocks for a European model for a fair data economy and common internal market for data. These proposals aim to improve and harmonise the currently fragmented EU legislative framework. The reforms will therefore give the EU’s data economy a better chance to develop by stimulating economic growth and innovation in Europe. At the same time, they are designed to support the EU’s digital and green twin transition.
The new data regulation can be seen as a new ‘GSM moment’ for Finnish companies. A similar leap was once taken in the telecom market to allow a phone user to be able to call someone on another operator’s network. Finnish companies developed the GSM system that guaranteed interoperability and, for example, common registers of subscribers and visitors to the network. The standard became a successful export product. Now, the new data regulation requires a similar movement of data across organisational and sectoral boundaries, but it does not address how this will be done.
In the current transition, there is a renewed demand for Finnish leadership. The more Finnish companies offer their own expertise in developing ground rules and ensure that they comply with the principles of a fair data economy, the more likely it is that they can also become the basis for EU-wide practices in the internal market.
Despite the new opportunities, companies are still ambivalent about the new regulation. In Sitra’s 2021 business survey, SMEs in Finland and three peer countries identified regulatory complexity and ambiguity as the biggest challenge to success in the data economy.
What do we do?
We are investigating the opportunities that EU data regulation opens up for us as a society. Besides regulation, we are exploring the measures needed to make Finland a model country for a fair and sustainable data economy.
We aim to increase understanding of the new opportunities that regulation offers to the Finnish business community. We also provide information and support to civil servants, decision-makers, researchers, educators and consumers. We develop practical tools to clarify the regulatory environment and seize opportunities.
Who is involved?
Our work involves a wide range of participants from both the public sector and academia and NGOs in Finland. We also actively promote our common positions towards the EU.
The work is part of the national roadmap for a fair data economy, co-ordinated by Sitra. Influencing within the EU and strengthening the associated foresight has been identified in the stakeholder work as one of the key areas requiring change.
Where are we now?
We are actively monitoring the development of EU regulation affecting the data economy, contributing to the social debate and pushing for measures to harness the opportunities provided by regulation. One way to do this through our responses to the requests for statements from the public authorities, by which we highlight the importance of the principles of the data economy and the implementation of the twin transition.
In close cooperation with stakeholders, we are creating self-learning materials for SMEs and others involved in the data economy about the opportunities opened up by the revised regulation. To illustrate the trends, we compile examples of pioneering companies and interesting experiments in the learning materials. The materials will be issued as a digital course package open to all during 2023.
What has been achieved?
In June 2022, we published a working paper on the EU’s legislative proposals for the data economy, in which we analyse how the revised legislation will realise the goals of the European strategy for data and open up new opportunities for different participants in the data economy.
We focused on the Big Five proposals of the European strategy for data: the Data Governance Act (DGA), Digital Markets Act (DMA), Digital Services Act (DSA), Artificial Intelligence Act (AIA) and Data Act (DA).
The working paper made recommendations for action, which can be roughly categorised into four broad areas:
- Finland needs to develop a wide range of measures to identify it as an attractive model country in the data economy.
- Public and private sector players must share a vision of a fair data economy.
- Data regulation should not just be reactive, but should be proactively influenced as early as possible.
- Understanding the basics of the data economy must become a new civic skill and skills need to be developed on a broad front.
Sitra’s Roadmap for a Fair Data Economy project is working closely with stakeholders to accelerate these measures in Finland.
The working paper is a follow-up to Sitra’s memorandum (in Finnish) published in January 2022 on Finland’s strengths, challenges and opportunities in the development of the data economy, and what Finland can learn from the leading countries of the data economy. The memorandum highlighted infrastructure, skills, collaborative networks, regulation and accountability as priority areas where Finland needs national co-operation to develop a competitive data economy.