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“Governance of Data Sharing” forthcoming in Research Policy

The latest paper of our long-term project studying the economics of data-driven markets is concerned with implementing the policy solution that was developed by previous work: “Governance of Data Sharing: a Law & Economics Proposal” (co-authored with Inge Graef) has had quick uptake and will be published in a special issue on the “Governance of AI” at Research Policy.

To the best of our knowledge, this is the first actual design proposal how and with which governance structure (i.e. which allocation of rights and duties) mandatory data sharing can best be implemented. It is currently considered by EU authorities revising the proposal of the Digital Markets Act, a key piece of EU-legislation aiming to regulate online platforms.

More details (working paper version): To prevent market tipping, which inhibits innovation, there is an urgent need to mandate sharing of user information in data-driven markets. Existing legal mechanisms to impose data sharing under EU competition law and data portability under the GDPR are not sufficient to tackle this problem. Mandated data sharing requires the design of a governance structure that combines elements of economically efficient centralization with legally necessary decentralization. We identify three feasible options. One is to centralize investigations and enforcement in a European Data Sharing Agency (EDSA), while decision-making power lies with National Competition Authorities in a Board of Supervisors. The second option is to set up a Data Sharing Cooperation Network coordinated through a European Data Sharing Board, with the National Competition Authority best placed to run the investigation adjudicating and enforcing the mandatory data-sharing decision across the EU. A third option is to mix both governance structures and to task national authorities to investigate and adjudicate and the EU-level EDSA with enforcement of data sharing.