Digital market could provide innovation boom, heads of state told

Two innovation groups have said that if the single digital market is to take off in Europe, the EU needs its own regime of taxes and rules for entrepreneurs that could supersede national regulations.

The recommendation, by UK innovation agency Nesta and Brussels-based think tank the Lisbon Council, is directed at EU heads of state meeting today to discuss the digital agenda. In a strategy released this month, the groups present the case for a “real” digital single market, which they argue would be the most effective way, even surpassing R&D spending, for the EU to boost innovation.

“For companies that are trading digitally, the European Commission should put in place a new, lower-regulation type of company that can trade freely across the EU and will be governed by a single set of rules,” says Stian Westlake, executive director of policy and research at Nesta. At the moment, EU innovation policy is too focused on the target of spending 3 per cent of GDP on R&D. “Research is an important part of innovation, but it’s definitely not the whole picture,” he says.