October 18, 2022

“The rule book is like a constitution for the data sharing networks”

In the first article in this series, Jogi Poikola gave us a view into how, and why, Sitra – Finland’s innovation fund – and IDSA have joined forces, along with 10 other members, to create the Data Spaces Support Centre. It comes down to a shared commitment to a decentralized European data economy, and the guiding principle of data sovereignty. It turns out that IDSA and Sitra share a common approach: rule books.

In this second article, Jogi describes the particular challenge enterprises face when sharing their data across jurisdictions, and how rule books, as conceived by IDSA and Sitra, can engender mutual trust in competitive contexts.

Jogi, welcome back. Lets’ dive right in. How and why did the rule book approach take root in Sitra, and in data space organizations in Finland generally?

That’s a fun story actually. It involves saunas, snow, and some wrestling. Back in 2019, when I was working at Technology Industries of Finland and MyData, we, along with some people I knew working on Sitra’s IHAN project, organized what you might call a data spaces boot camp. We booked a nice hotel in the forest near Helsinki, where we spent two days thinking about the future of data spaces, data operators, intermediary services… everything related to the area.

One question we wrestled with (metaphorically… the real wrestling came later) was how to enable decentralized data sharing among potential competitors. There’s so much risk involved. Well, some of the group had strong backgrounds in finance and banking and were familiar with the idea of decentralized data sharing among competing companies (i.e., banks).

The question being, how do they make it work?

Right. And the answer is that they use rule books – sometimes hundreds of pages thick – which precisely describe the roles, responsibilities, processes, and governance for decentralized networks with many competing parties. Crucially, there are no point-to-point contracts between the different parties. Instead, there is one rule book that all the parties have signed. In effect, the rule book is like a constitution for the data sharing networks.

But can this rule book apply to every context? Surely there are many nuances to each relationship between data providers, and the intermediaries, too.

Of course. There are as many rule books as there are data sharing networks or data spaces as we call them now. It all depends on who is involved, and under what scope.

But saunas, snow, wrestling… you can’t leave us hanging Jogi…

Ok, to return to the story, our boot camp shifted its focus to how the methods of data sharing in finance could or should be applied to data sharing in any setting. This immediately resonated with what was a very diverse group… we had lawyers, tech people, bankers as I mentioned. In fact, it was the technology specialists who at that moment said, ok, if we have this constitution, this rule book, then it needs a technological implementation so that there’s no laborious paper-signing. It should all happen cryptographically. The idea and the process began to crystallize.

Which was when we fired up the sauna. And yes, there was some friendly wrestling in the snow, which was apparently instrumental for our discussions 😉 The following day, Sitra decided to support the further development of the rule book idea. A group of legal advisors and technologists produced the first version of a rule book template for fair data economy in 2019. Version 2.0 was published at the end of August this year.

Some literal and metaphorical wrestling. Both necessary, it seems. If you were to encapsulate the idea of a data spaces rule book, what would that look like?

The rule book is a framework which defines the questions parties need to ask about the data network they are building. Everyone simply completes the rule book according to the particularities of their jurisdiction, their organization, and the data they wish to share and how. The point is they don’t need to reinvent these contracts every time. They can draw on the rule book’s documents to establish and govern a data network based on mutual trust that shares a common mission, vision, and values.

Has this been put into action yet?

Yes, in fact Sitra’s Fair Data Economy Rule Book was used for the first time back in 2020. Partners in the pilot project were SEB, a leading Nordic financial services group, and Wärtsilä, a leader in smart technologies and complete lifecycle solutions for the marine and energy markets. Prior to building their data ecosystem, the two partners signed a consortium agreement and the rule book. Using the checklists and other elements of the rule book, the partners were able to shape and concretize the data ecosystem bit by bit, from clarifying technical procedures to agreeing on legal provisions, to eventually implementing the functions necessary for exchanging data.

Amazing. It really shows how organizations such as Sitra and IDSA are paving the way for the new European data economy to flourish. Assuming that companies work to increase revenues, cut costs, and reduce risk, and that even talking to another company is a risk, data spaces formed on the back of context specific rule books enable data sharing to take place in the spirit, as you said, of mutual trust.

Jogi, thanks once again. We’ll meet in part three of this series to explore how the Data Spaces Support Centre will further enhance the interoperability of data and data sharing services between sectors and domains.

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