Puerto Rico governor enacts Sharing Economy Law
Administration seeks to adopt business model as a means to foster development with established regulations
SAN JUAN — Gov. Ricardo Rosselló signed Thursday Senate Bill 840, which will establish a process for the design and execution of the government’s public policy on the sharing economy.
The sharing economy, also known as the on-demand economy and gig economy, is the economic system in which goods and services are shared between individuals. Examples of the sharing economy are a crowdfunding site that accepts funds for a project; providing a personal car and driver via a ride-hailing app; renting out one’s home to vacationers through lodging platforms; and selling goods online.
“This forward-looking law allows for Puerto Rico to have the procedural framework that allows for the local sharing economy to respond swiftly, consistently and transparently,” Rosselló said in a statement. “It also highlights the importance of balancing the public interest and of encouraging new economic activity with the protection of industries that are duly established and regulated.”
The governor added that his administration’s “commitment with the sharing economy” is part of its efforts to “attract new markets and demonstrate that we are open for business and to connect with the rest of the world.”
Senate Bill 840, authored by New Progressive Party Sen. Zoé Laboy, requires the Economic Development & Commerce Department (DDEC by its Spanish acronym) to establish the standards and guidelines that reflect that the policy is ready to be considered by agencies during the regulation-development process.
The regulations should be consistent with the principles set forth in the law, which are based on “neutrality and the protection of the general wellbeing.”
The advisory committee will be tasked with advising the DDEC on assessing, elaborating and implementing the sharing economy regulations, and ensuring that the law’s objectives are complied with.
“The sharing economy has already stopped being a novelty and has turned into a trend in the development of new businesses,” Economic Development Secretary Manuel Laboy said in the press release issued by the governor’s office, La Fortaleza. “We are confident that this initiative is another example that by identifying ways of doing things differently we can achieve great results.”
Ricardo Llerandi, La Fortaleza’s chief of staff and Trade & Export Co. (CCE by its Spanish initials) executive director added that the “way of doing business has definitely evolved, and to be able to adapt to this new reality, Puerto Rico Emprende has developed innovative initiatives such as the Apps & Videogames Challenge,” Llerandi was referring to the government platform to foster opportunities for the development of local businesses so they create jobs and compete locally and abroad.
“Through these initiatives we continue encouraging a new generation of digital entrepreneurs, promoting their development and so that they can enter the foreign market,” Llerandi added.
The CCE chief said that to “position the island as an investment destination for the videogame industry, it’s important to have a robust local industry.”
The initiative, Llerandi said, allows for local talent to develop their projects from Puerto Rico.
Secretary Laboy said the sector has grown significantly in the past years.
“However, in Puerto Rico there are very few businesses that use this model,” Laboy stressed. “This initiative…clarifies and groups the regulation of this economic sector under a single entity. This way, we avoid finding regulations that will only benefit some industries and create a safer environment to continue encouraging the growth of this economic sector.”
The Economic Development chief further noted that the “sharing economy has undeniable multimillion-dollar economic growth around the world and this certainly represents a great opportunity for Puerto Rico.”
Puerto Rico Tourism Co. (PRTC) Executive Director Carla Campos was also quoted in the release as saying that “the collaborative economy allows visitors to have access to a wider lodging offer and more Puerto Ricans to participate in the economic spillover generated by tourism, thus democratizing the participation in the sector and allowing municipalities that did not participate in tourism, for not having traditional hotels, to now be able to receive visitors. Through this law, the necessary regulation will be worked on to incentivize the sector while safeguarding the oversight elements needed.”