Regulatory Sandboxes (Experimental Legal Regimes) for Digital Innovations in BRICS

Author:E. Gromova - T. Ivanc
Position:South Ural State University (Chelyabinsk, Russia) - University of Maribor (Maribor, Slovenia)
Pages:10-36
BRICS LAW JOURNAL Volume VII (2020) Issue 2
ARTICLES
REGULATORY SANDBOXES EXPERIMENTAL LEGAL REGIMES
FOR DIGITAL INNOVATIONS IN BRICS
ELIZAVETA GROMOVA,
South Ural State University (Chelyabinsk, Russia)
TJAšA IVANC,
University of Maribor (Maribor, Slovenia)
https://doi.org/10.21684/2412-2343-2020-7-2-10-36
Step by step, new digital technologies are capturing dierent spheres of our life. The
opportunities of their application are almost innite, and potential is very promising. But
digital innovations as a trend represent a challenge for every modern state. Especially for
member-countries of the BRICS union who seek to become the world’s leading countries.
For this reason, the most important task for the members of BRICS is to create adequate
“smart” regulation, which oers alternative ways of regulatory impact on transforming
business relations. Using the regulatory sandbox as an experimental legal regime is
one of the ways to test the creation, production, and realization of digital innovation.
Having been first applied in 2016 in the United Kingdom, nowadays this model is
successfully implemented in such countries as Singapore, Australia, and the United
Arab Emirates. Member-countries of BRICS are only beginning to adopt this unorthodox
tool; in most of its countries the legal framework is ongoing now. The aim of this research
is to analyze current legislation and legal framework on the regulatory sandboxes in
BRICS countries, dene features of national models, diculties and further prospects
of its usage. This research is based on the comparative and formal juridical analysis of
legislation, draft laws, and research papers dedicated to regulatory sandboxes in BRICS.
The authors identify dierent barriers and risks of using regulatory sandboxes for the
digital innovations successfully and oer some ways to overcome these challenges,
including the formulation of guidelines for operating regulatory sandboxes based on
a balance of public and private interests. The authors conclude that it is necessary to
ELIZAVETA GROM OVA, TJAšA IVANC 11
update legislation on the regulatory sandboxes for reaching positive eect from the
digital transformation and make several suggestions for optimization its provisions. The
results achieved in research paper can be used both in the lawmaking process as well as
the foundation for further scientic researches.
Keywords: regulatory sandboxes; experimental legal regime; smart regulation; digital
economy; innovations.
Recommended citation: Elizaveta Gromova & Tjaša Ivanc, Regulatory Sandboxes
(Experimental Legal Regimes) for Digital Innovations in BRICS, 7(2) BRICS Law Journal
10–36 (2020).
Table of Contents
Introduction
1. Regulatory Sandboxes as a New Tool of Smart Regulation and
Innovations’ Facilitator: Denition, Genesis, and Related Constructions
2. Status of the Legislation on the Regulatory Sandboxes in Member-
Countries of BRICS
2.1. Regulatory Sandboxes in the Federative Republic of Brazil:
Readiness for Legal Framework Process
2.2. Experimental Legal Regimes (Regulatory Sandboxes) for the Digital
Innovations in the Russian Federation: Problems of the Draft Law
2.3. Regulatory Sandboxes in the Republic of India: The Beginning
of the Legal Framework’s Creation
2.4. Regulatory Sandboxes in the People’s Republic of China:
Aspiration to Get Ahead
2.5. The Republic of South Africa: Looking for Proof of Regulatory
Sandboxes’ Legitimacy and Eciency
3. Global World Trends in Regulatory Sandboxing: The Way to Global
Regulatory Sandbox or “Sandbox for Sandboxes”
4. Recommendations on Setting Up a Regulatory Sandbox for BRICS
Countries: Keeping a Balance Between Private and Public Interests
Conclusion
Introduction
The fourth industrial revolution and global digitization process have led to the
appearance of new, innovative, or disruptive” technologies, which aect and transform
dierent spheres of modern social life. Such innovations as high-performance and cloud

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