1 June 2017
Sharing economy: the Canadian perspective
The sharing economy is increasing in popularity and involves an ever larger number of players. In this study, we focus on online sharing economy platforms (OSEPs), which consumers can use to borrow goods or obtain services. The sharing economy is convenient, relatively inexpensive, and offers an experience tailored to individual consumer requirements. It does, however, have some shortcomings, particularly as regards the protection of consumers and the public. Many questions arise: who are consumers who conclude a contract via an OSEP actually transacting with? What rights and remedies do they have in the event of problems?
These platforms include product service systems that permit consumers to use a product belonging to someone else, or benefit from a service offered by a private individual.
There are other issues are worth considering. How safe are consumers who use the sharing economy in order to seek accommodation or a means of transport? Generally, those offering their goods or services via an OSEP are not subject to the same rules as traditional businesses. What about liability? Insurance? Dynamic pricing?
In our study, we identified the protections offered to consumers who use OSEPs. This involved studying the terms and conditions of agreements and related documents from a representative sample of OSEPs. These were platforms featuring sharing mobility, short-term private accommodation rentals and services offered by individuals.
Our analysis revealed certain problems with the terms and conditions of OSEPs, which often accept only limited civil liability. They justify this by stating that they merely connect people, whereas in fact, they do much more than that. They also limit consumers’ rights and remedies, contrary to the laws of certain Canadian jurisdictions.
We also analyzed the Canadian legal framework. In so doing, we identified the major protections included in provincial consumer protection legislation that could apply to OSEPs. These rules apply to transactions between a consumer and a merchant, but may not apply to transactions between two individuals. In addition, some exclude certain sectors, such as rental accommodation, from their scope.
We also examined statutory legislation and common law that might apply to the areas in which OSEPs operate, and to situations that might arise during use. Some of these laws provide less protection than those specifically intended to protect consumers. Common law also promotes freedom of contract between parties, without exception, which enables the parties to waive certain protections.
In our quest to find appropriate solutions that would protect consumers and to identify best practices, we also studied foreign legislation, finding inspiration in certain initiatives of French and European Community law.
We also wanted to know how Canadian consumers who use these OSEPs perceive the laws designed to protect them and how much they know about them. We therefore conducted a survey of 1100 such Canadians. In addition to revealing their motivations and misgivings about OSEPs, our survey showed that when it comes to the sharing economy, many consumers find it difficult to describe their contractual relationship and have little knowledge of their rights.