What is a regulatory sandbox?

A regulatory sandbox is a structured framework within which companies can test innovative technologies in collaboration with the relevant authorities under conditions that closely resemble real-world scenarios.

The aim is to clarify specific issues at an early stage – before an application is rolled out widely on the market. This involves not only regulatory issues but also, depending on the specific use case, technical, organisational or institutional aspects.

A sandbox thus creates added value for both sides: companies gain early guidance and greater legal certainty, whilst authorities can learn from specific use cases and gain a better understanding of new technological developments. This so-called regulatory learning helps to continuously refine the regulatory framework.