Regulations and innovations. What is the role of governments and Businesses

Investments and international trade directly depend on good regulation, making the parties and investors more confident. At the same time strict regulation cannot leave much space for innovation. The speakers share their ideas about the right combination of regulations that could allow the business to develop faster.
The moderator: Amanda Kayne. Speakers: Zina Isabaeva, Alexander Kryvosheyev, Filippo Lombardi, Irakli Mezurnishvili, Vincent Subilia.
Filippo Lombardi, Vice President Silk Road Support Group, OSCE Parliamentary Assembly, Ticino, Switzerland states there is a mismatch in the society in terms of attitude over the regulations. There is a contradiction between the regulations and innovations in the way that innovations bring something new, while regulations consolidate something existing. In economics contradiction comes when businesses first refuse the regulations but try to refer to them in bad times. Government contributes to the society by regulating something. In his opinion positive impact is when rule of law is established under different interests presented and is predictable and secure. Negative effect comes when it is overregulated. So, it is very important to support self-regulation.

Speaking about SDD, the first level is information, persuasion and communication that can change people's behavior. The second level is incentives and the third one is prohibition. All these levels, Filippo believes, should be used with a certain ability to evaluate what the best and the most effective level is.

Irakli Mezurnishvili, First Deputy Chairperson, Economy and Economic Policy, Parliament of the Republic of Georgia believes that regulations proactively shape the environment. He gives the example of positive change with the implementation of regulations: Georgia was the first country that managed to enforce blockchain system in the private sector. Government, business sector and consumers should have dialogue creating economic development of a country. Georgia now is making first steps to adopting RIA regulation impact assessment. Having the lack of proper education in finance, the country must regulate the banking system, the financial system and protect the citizens. Good regulation is also crucial for further attracting of foreign investments into Georgia.

Alexander Kryvosheyev, Vice President, Corporate Affairs, Eastern Europe region, Japan Tobacco International, Geneva, Switzerland names two important things in regulation policy: clarity rules and how they are applied and engagement of the parties that are affected by these regulations. He gives the example when poor analysis lead to fiasco in the market: increasing taxes for tobacco by Russian government ends with the illicit trade grown by 50%. Alexander says their company has a clear contribution and direction to sustainable development goals. The question is whether government can use the data provided by businesses for creating new regulation. The speaker thinks it can be used if the necessary calculation and analysis is provided and proved the necessity.

Vincent Subilia, Director General of the Geneva Chamber of Commerce, Industry and Services, Geneva, Switzerland represents both government and private sector and can share views from both sides. Regulations after they are adopted and implemented should be sound, sharp, and smart. What we can see now is a political rhythm and the market momentum. He believes that there is a necessity to reconcile political momentum with the business requirement. Regulations should leave some space for innovation and business. By having this dialogue, it is ensured that we have multi shareholder approach and consensus is implemented. It is made to ensure that regulations do not hamper business activity and balance it.

According to the survey made in 2019 overregulation is №1 concern of the world business stakeholders. Vincent refers to a famous expression that can be used in this sphere as well: Simplicity is the key to sophistication.
The moderator: Amanda Kayne. Speakers: Zina Isabaeva, Alexander Kryvosheyev, Filippo Lombardi, Irakli Mezurnishvili, Vincent Subilia.