Margrethe Vestager also proposed data sharing among market players. However, the proper technical and legal standards must be developed to ensure security and fairness when sharing data.<sup>32</sup> A debate associated with sharing data is whether and how to create a fair data marketplace.<sup>33</sup> A wellfunctioning and transparent data marketplace would help address the current unequal distribution of risks, costs, and benefits.<sup>34</sup> Data would be tracked and monetized as commodities. Moreover, businesses would no longer be able to access, hold, and use customers’ data without any costs. Such an arrangement would break the cycle in which established digital businesses continually utilize the free data they accumulate to generate profit and maintain their dominant market position. The European Union has begun to create a common European data space, estimating that the value of the European data economy could increase to €739 billion by 2020.<sup>35</sup> The public sector is spearheading this initiative by making available to firms highvalue geospatial, transportation, and business management data sets, among others. However, convincing private companies to do so remains a challenge.

Regulatory arbitrage is another problem. When platform businesses bypass regulations to enter some traditional sectors, such as Uber versus taxis and Airbnb versus hotels, the question arises of whether business players are competing on a level playing field. For example, Uber is not subject to the same fare and vehicle quota regulations faced by the traditional taxi companies. And Airbnb hosts do not have to meet the zoning requirements applicable to hotels. Adapting the licensing or certification requirements within a regulatory framework to new businesses becomes important to ensure a level playing field for traditional and new players.<sup>36</sup> Besides watching the existing giant digital businesses closely, governments, especially those from developing countries, should spend more resources on creating an environment that will enable start-ups to grow into superstar digital businesses. The World Bank’s _Doing Business_ project provides a tool for governments seeking to reform toward efficient business regulation and enforcement. Public support through incubators, accelerators, hubs, entrepreneurship associations, and related institutions also helps to promote digital entrepreneurship. In 2016 the World Bank and CTIC Dakar, Senegal’s leading ICT incubator, launched the Jambar Tech Lab. It offers training to local tech start-ups in how to commercialize and scale innovative digital products.

Creating a venture capital ecosystem to incubate promising start-ups adds momentum for their takeoff. Strong capital support lowers the risk of aggressive and malicious acquisition from giant digital businesses. Benefiting from direct funding support and preferential policies, Singapore is now home to more than 150 venture capital funds, and venture funding increased from US$800 million in 2012 to US$10.5 billion in 2018.<sup>37</sup> The booming venture capital activities contributed to doubling the number of local tech start-ups over the last decade.

# Taxation

The boundaries of digital platform firms are now transcending borders and physical assets, presenting the present global corporate tax regime with severe challenges.<sup>38</sup> The long-standing taxation principle of permanent establishment and physical presence creates loopholes when applied to digital business activities. A government’s current taxing rights on corporate income are based on the physical presence of a firm in its jurisdiction. Companies that have only a significant digital presence in a country are free from taxation liability because of lack of legal nexus under the international rules.<sup>39</sup> Facebook has over 2.3 billion monthly users spread over nearly every country, but it pays little or no tax in many countries where it does not have an office.

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