What is a prize-backed competition?

‘It is a procedure through which the government selects the best idea to solve a social problem. Sometimes this involves deciding what to do with an old building, or, conversely, designing a new one. The government may also seek an innovation, such as using AI to improve healthcare. Competitions are also used for social initiatives. For example, a local council might name the ‘greenest entrepreneur’ to promote sustainability. Furthermore, the government uses competitions to reward exceptional achievements. In the field of science, for instance, this is reflected in the cash prizes awarded by the NWO, the Netherlands Organisation for Scientific Research, including the Spinoza Prize and the Stevin Prize.’

Why did you want to investigate public competitions?

‘I believe the government cannot use this tool effectively if it does not understand what it is doing from a legal perspective. There is no single legal framework for public competitions, yet, such a competition is never unregulated. This can lead to ambiguity, an unlawful outcome, or the granting of unlawful state aid. That is not exactly conducive to solving the underlying social problems.’

Are the competitions currently being used lawfully?

‘Sometimes yes, sometimes no. In my thesis, I examined 144 public competitions. I soon realised that the dividing line between the different types of competitions is rather vague. That is why I drew up a general legal framework for all public competitions and assessed whether government organisations are complying with it. There are areas of concern, including those relating to the benefits and burdens for participants.’

‘At times the prize money is simply too low. Or there are onerous intellectual property requirements regarding the winning idea. If an innovation turns out to be a breakthrough, it may be enormously valuable. Who owns the winning plan? The inventor or the government that invested the money? I am left with the impression that some government organisations don’t clearly communicate to the participants about the procedure in advance. Both the government and the winner may then face unpleasant surprises. Or market players may decide not to take part at all. That undermines the innovation potential of the competition.’

Aren’t there any lawyers working for the government who can prevent these problems? 

'Of course there are, but those lawyers are sometimes overburdened or accustomed to a particular type of procedure, whilst there are other options available. Or they are brought in only once a decision has already been made at the political and administrative level. My advice would be: involve lawyers at an earlier stage. The law is often seen as an obstacle, but it can actually offer a great deal of certainty and scope. I hope that government lawyers will find the frameworks in my thesis useful.’

Are you still a fan of prize-backed competitions?

‘They are ideal for engaging society and stimulating innovation. After all, the government starts with a question and leaves it to the market and citizens to come up with solutions. But the government is risk-averse and sometimes fails to think things through carefully enough. As a result, opportunities are missed. Hopefully, my thesis will help ensure that these opportunities are seized more often.’