The EU Commission issued a communication on the collaborative economy on Thursday 2 June, urging member states not to hamper it by excessive regulation.

Licensing requirements in many member states have limited the growth of transportation services companies such as Uber, while in the accommodation sector, platforms like Airbnb have been subject, in the Commission’s view, to over-regulation. The Commission has clarified its view that business authorisations requirements should only be imposed on these service providers when necessary to meet relevant public interest goals.

While there is still no consensus on a clear legal definition of this phenomenon, there are undisputedly significant benefits stemming from internet platforms. The Commission emphasized that the collaborative economy is providing opportunities for new forms of employment, flexible working arrangements and a source of income for many people, hence such activities should only be banned as a measure of last resort.

 The Commission also addresses the crucial issue of the status of workers in the sharing economy. While recognising that member states should ensure fair working conditions and adequate and sustainable social protection for these workers, the Commission recommends that the different needs of workers and self-employed people in the digital world as well as the innovative nature of collaborative business models should be taken into account when assessing whether and how existing national employment rules should be applied to the sharing economy. The Commission also calls on members states to provide guidance on the applicability of their national employment rules in light of labour patterns in the collaborative economy. A similar call is made for the related tax issues. The Commission has not taken a position in the hotly disputed classification controversy on whether workers in the collaborative economy are employees or self- employed. Instead, it states that this is a matter for member states and their national courts to rule on, and reminds readers about the ECJ case law on the concept of worker and the 3 cumulative criteria which must be fulfilled for a worker to enjoy the protection deriving from EU labour and employment laws (subordination, nature of work and remuneration). The Commission seems to accept the idea that these criteria might not be met in all cases in the collaborative economy, but again this is not a matter for the EU to decide on. The Communication thus remains neutral on this central issue and is silent on the so called “third way” (a new status in between the classic employee/self-employed division) and other more creative solutions which have been developed elsewhere (see our previous post).