Presentation by Paola Pisano at the OECD Global Conference on Governance Innovation which took place in Paris on 13-14 January 2020. Further information is available at http://www.oecd.org/gov/regulatory-policy/oecd-global-conference-on-governance-innovation.htm.

1. The Daunting Task
of Regulating
Innovation
Paola Pisano
Minister for Technological Innovation and Digitization
Conference on Governance
Innovation
OECD, Paris 13-14 January 2020

2. Agenda Introduction
Italy Outstanding Issues
Local Level Experiences
What we are doing
Our Vision
Challenges
02
KEY TOPICS

3. INTRODUCTION
03
● Regulating in “normal time” can be difficult
● The speed of transformative technologies
determines growing complexity and uncertainty in
many areas
● Governments have a major role in encouraging
innovation and incentivizing the development of
emerging technologies

4. 04
Some inspiring examples of fixed-term
regulatory exemptions and adaptive
regulations
In the USA, the Federal Aviation
Administration launched the
Unmanned Aircraft System-
UAVs Integration Pilot Program
to test the safe application of
drones.
The UK Office of Gas and
Energy Markets - OFGEM
launched a regulatory
programme for innovators in
energy markets, enabling them
to test innovative business
products, services and business
models that otherwise cannot
function with real-life
customers under existing
regulations.
The Federal Ministry of
Transport and Digital
Infrastructure (BMVI) in Germany
set up a “Digital Motorway Test
Bed” to allow testing the latest
automated driving technology in
a real-life setting.
UK GERMANY USA
Source: OECD The role of sandboxes in promoting flexibility and innovation in the digital age - Going Digital Toolkit Policy Note - DSTI/CDEP/GD(2019)7

5. 05
Italy outstanding
issues
● According to the World Bank Doing Business
2020 and Doing Business in the EU 2020, since
2012, Italy has introduced several measures to
improve its performance
● The digitalization of public administration has
also shown sivgnificant progress
● Yet, the Italian business environment remains
challenging and still performs below the EU
average in terms of the ease of doing business
● In civil law regimes such as ours, excessive
regulation limits technological development:
regulation excluded the circulation of electric
kick-scooters in the cities; a norm was recently
introduced putting them in the same category
as bikes
● We need Technology Neutral Regulation

6. MY EXPERIENCE
AT LOCAL LEVEL
06
● My experience as a Deputy Mayor and Council Member
with the Innovation portfolio, in the City Council of Turin
is inspiring my strategy as Minister
● “Torino City Lab”, a platform aimed at creating specific
regulatory arrangements for companies testing
innovative solutions at pre-commercial stage, in the real-
world environment
● Torino has become an open laboratory of frontier
innovation able to attract companies and skills for the
development of the "City of the future": autonomously
driven and connected vehicles, drones, IOT and 5G, AI
and robotics

7. 07
● Entrepreneurship and innovation are means, not
ultimate policy goals.
● Public policy should encourage innovative
entrepreneurship that address grand societal
challenges: youth unemployment, aging, climate
change, food security, immigration.
● Create policy spaces for testing new business
models and services that can benefit society at
large, without lowering protection.
MY INITIATIVES
AS MINISTER

8. 08
● The bill provides a form of regulatory waiver or
flexibility for firms to test new products or business
models with less regulatory requirements, while
preserving some protection.
● Startups and innovative companies that find a
regulatory obstacle, will thus be able to pursue their
project.
● The bill requires that applicants demonstrate the need
for the regulatory exemption and identify the
regulatory requirement constraining their activity
● It is mandatory for applicants to provide an ex-ante
impact assessment on positive societal impacts.
● If the experimentation proves to have a positive social
impact, the specific norms that prevent the innovative
product or service will be modified
Introducing a New Bill:
The Right to innovate (Diritto ad
Innovare)

9. Ethics Lab
09
● We’re working on the establishment of the “Ethics Lab”
focused on the rules of developing AI fair, accountable,
and transparent way algorithms
○ We wish to introduce a labeling system to certify
that all AI public sector applications are compliant
with ethical values and laws
○ We wish to apply the principle of Incorporating -
wherever possible - the rules in coding and
algorithms to ensure regulatory efficacy
● We’re experimenting with an obligation for ethical-legal
impact assessment before introducing AI applications
to the market

10. Less bureaucracy more transparency
10
We are continuing our effort to eliminate useless and
redundant red tape, by making more public services
available digitally for the benefit of citizens and
enterprises, to increase transparency and reduce
corruption:
○ IO Project
○ PagoPA

11. 11
● Identify stakeholders who are strategic for the
development of innovation and engage them in the
process
● Discuss with them through structured mechanisms
and include their suggestions to improve
countries' regulatory frameworks
● More cooperative mechanisms between public and
private players as there is a pressing need for a
deep and constructive synergy between public and
private players in shaping and implementing legal
rules
OUR VISION
COREGULATION

12. 12
● In some areas, and wherever appropriate,
governments should promote forms of self-
regulation, facilitating the creation of voluntary codes
and providing financial and institutional resources to
support private sector efforts (soft law vs traditional
regulation)
OUR VISION
SOFTLAW

13. 13
● National regulation is not suited to deal with
technologies of international scope; the risk is
jeopardizing the ecosystem.
● Delegate as much as possible in areas with high
innovative and technological content and delegate
secondary regulation and supervision to sector
Authorities in international networks.
OUR VISION

14. A DAUNTING TASK:
REGULATING WHILE INNOVATING
14
● There is much resistance
● How the OECD can help to speed up changes?
● Which form​ of governance ​can be useful?
● Which ​type cooperation the OECD can help to
establish in order to create a “coalition of policies
experimenters”?

15. THANK YOU
Q&A
03
Paola Pisano
segreteriaministropisano@governo.it
@paolapisano.min @MinisteroInnovazione