The NSW Government endorsed the use of regulatory sandboxes in November 2016 to improve the competitiveness of doing business in NSW.
The Regulatory Sandbox initiative encourages innovators to raise regulatory barriers with the relevant regulator and allows innovators to negotiate testing environments for new business models or products that are constrained by or outside of existing regulations.
A regulatory sandbox is a risk-controlled, time limited testing environment that enables:
- A business to reduce uncertainty and manage regulatory risks during the testing stage of its innovative product or business model
- A regulator to test adaptive regulatory responses to disruption in the market.
Success factors of regulatory sandboxes:
- The parameters are co-designed by government and stakeholders
- Risks are controlled
- It is time limited
- It is open to all businesses - the process of application and approval is transparent
- The parameters are clearly communicated and participants are bound by the conditions set by the regulator.
In February 2018, the NSW Government announced that it will soon establish its first ever Productivity Commission to drive microeconomic reform and tackle burdensome regulation in NSW.
The Commission, led by the NSW Productivity Commissioner, will spearhead a reform agenda, focused on four core themes:
- Making it easier to do business
- Lowering the cost of living
- Making housing more affordable
- Making NSW the easiest state to move to.
An online portal, to be released shortly, will allow citizens and businesses to identify the most important regulatory roadblocks, and provide fresh ideas to reduce the burden.
In addition, Innovation NSW is investigating sectors that are facing impending disruption, where there is a significant presence of businesses in NSW, and where there is the potential for significant net community benefit. We are kick starting conversations between businesses and regulators, to proactively address disruption and improve the competitiveness of doing business in NSW.