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Sandbox.Rio is the first controlled experimental environment in a Brazilian capital to test innovative solutions that do not fit into the pre-existing regulatory scenario. Based on the tests, information is collected that helps the City of Rio understand the innovations and the accompanying receptive regulatory framework that would be needed to adhere to new technologies. In addition, the generated database helps the design of public policies in Rio, which is established as a model smart city in Brazil. The project stands out for: i) being the first Brazilian capital to implement a regulatory sandbox; ii) not thematically restrict the projects, which range from smart city solutions to optimization of government activity; and iii) that all projects will ultimately undergo a technical regulatory impact assessment report that will assess the pertinence of regulating the product.

Innovation Summary

Innovation Overview

Sandbox.Rio is a project that aims to improve the regulatory framework of the Municipality of Rio de Janeiro through the development of a controlled test environment for experimenting with new technologies. Through it, tests of service and product innovations are carried out on a temporary basis, through the removal of the applicable regulatory framework and under the control of some state entity, in order to observe their effects in practice and, thus, build a set of guideline standards based on evidence produced by experimentation. The sandbox nomenclature is traditionally used in the computing area to describe a method of testing systems, through controlled environments, to verify their possible failures or vulnerabilities. The regulatory sandbox, on the other hand, originated within financial regulation, driven by fintechs. The possibilities brought by technological innovations in view of the sensitive systemic risk present in the sector made the instrument an interesting regulatory alternative available to the regulator.

However, regulatory sandbox initiatives seem to be very restricted, so far, to the financial sector and projects at the federal level (in Brazil, the Central Bank, CVM and SUSEP sandboxes stand out as an example). Nonetheless, the tool seems to us to be also useful for other spheres of government. In Municipalities, for example, with the different urbanistic and management nuances, a controlled test environment allows the insertion of products in the market in a safer and better integrated way for the community and the urban environment (see, for example, the impact of the disorderly insertion of electric scooters in Brazilian cities – which caused accidents, negative road effects and, finally, the unfeasibility of the business for most companies in the area).

With that in mind, Sandbox.Rio was conceived as a solution to transpose the sandbox concept into the reality of the Municipality of Rio de Janeiro. Its conception was possible through research and dialogues that contemplated (i) benchmark carried out at national and international level; (ii) meetings with members of academia and subject matter experts; (iii) dialogue with companies that work with innovation to verify adherence to the program and (iv) analysis of the adequacy of the sandbox idea to the context of the Municipality. From then on, studies began for the elaboration of a municipal decree to deal with the matter. The said decree was prepared by the Undersecretariat for Regulation and the Business Environment and subsequently analyzed by the Municipal Attorney General. As a highlight, the Decree provides that projects are selected through a Public Call Notice, which must have objective criteria for evaluation and assessment, a discontinuity plan, and a final technical report that will evaluate the results obtained and send a suggestion of regulation (or not) of the solution. Said Decree was published on April 26, 2022 and the Public Call Notice on 05/02/2022.

Eight proposals were received, of which five were viable during the selection period. The selected proposals cover topics such as: i) delivery of goods by drones (including ground drones); ii) embarkation and disembarkation of collaborative charter transportation; iii) installation of electric car chargers in public areas; and iv) modernization of the Municipality's tax compensation system. All approved proposals present solutions that have not yet been tested in Brazilian cities and will certainly contribute to the identification of Rio de Janeiro as a city open to technology and innovation. The approved projects, as they involve public areas to be assigned, are now going through a phase of defining implementation locations and monitoring methods.

Innovation Description

What Makes Your Project Innovative?

As mentioned, the project is the first sandbox to be implemented in a Brazilian capital and does so without thematic restrictions, allowing companies from different sectors to participate. Also, based on the testing of innovative solutions, information is collected to help the City Hall understand the innovations, ensuring a regulatory framework that is receptive and compliant with new technologies. In addition, the data generated during the testing period will help public managers in designing public policies of interest to the Municipality.

What is the current status of your innovation?

The policy is still in the implementation phase.

Innovation Development

Collaborations & Partnerships

In the formulation of Sandbox.Rio – and above all during the drafting of the decree and the elaboration of the notice and annexes – academia, companies that work with innovation and other internal bodies of the City Hall (such as the Attorney General's Office of the Municipality) were consulted to assess the legal regularity and project potential. At the current stage (implementation), we are still in dialogue with actors such as SENAC, ITS Rio and MIT to form possible agreements in the management and sharing of knowledge.

Users, Stakeholders & Beneficiaries

The project has several layers of beneficiaries. On the companies' side, it assists in the entry of new products and services into the market with greater regulatory security. On the part of the Municipality, it helps in the understanding of the innovations in advance and based on the available data generated in the testing phase. On the citizens' side, there is greater security of coexistence in the urban environment with an innovation now tested in a controlled context.

Innovation Reflections

Results, Outcomes & Impacts

As it is still in the implementation phase, the concrete results of the policy are still uncertain. However, as the selection of innovative solutions has already been completed, there is an unprecedented potential to generate efficiency gains, reduce costs and entry barriers for innovative products, processes and services in the city's business environment. As revealed by the Financial Conduct Authority (FCA), the UK's financial regulator, the sandbox makes it possible to reduce by up to 3 times the cost of creating and validating a product, service or process and launching it on the market. In addition, the thematic plurality of projects demands specific monitoring and evaluation methodologies. All projects will be accompanied by interactive and simultaneous dashboards. From the reports generated, the data will be analyzed and the final technical report will adopt the most appropriate methodologies for each case, such as cost-benefit analysis, cost-effectiveness, multicriteria, among others.

Challenges and Failures

The central challenge consists in the dialogue with the various actors - public and private - involved in the project. As there is no thematic restriction, proposals from different segments were received. At the same time, the Sandbox regulatory decree determines that any regulatory exemptions to be granted depend on the acquiescence of the body with competence for regulating or supervising the activity. Thus, the Secretariat responsible for the initiative (SMDEIS) had – and still has – the challenge of managing contact with different bodies, conducting thematic meetings and drafting technical documents more adherent to each area.

Conditions for Success

In addition to the open and constant dialogue with academia, bodies or entities with sectoral regulatory competence and companies that operate in the area of science, technology and innovation, the success of the Sandbox, specifically in terms of execution and the positive results for the local innovation ecosystem, requires the development of strategic planning accompanied by good public governance to make the initiative viable. In addition to these conditions, the analysis of the results collected during the execution of activities, in order to deliver public value for the improvement of sectoral regulation and public policies of the municipality for the promotion of the innovation ecosystem.


Rio asserts itself as the first Brazilian capital to create a regulatory sandbox, which, initially, was structured to receive proposals in a broad way, in order to contemplate not only companies but also research institutes and other entities dedicated to the promotion of technological innovations. The municipality's initiative, already in the implementation phase, has the vocation of being replicated for new cycles, including in delimited modeling for thematic challenges, such as sustainability and energy, which has already attracted interest from partnerships on the part of institutions such as MIT and companies of the sector, as well as for specific areas of the city. Finally, Rio City Hall is also available to assist other municipalities and states in the creation of their own sandboxes, bearing in mind that the terms stipulated by the Decree and Public Call Notice are adaptable to other realities.

Lessons Learned

The City Hall initiative was able to present a diagnosis of the potential for innovation at the local level, providing opportunities, in a first sandbox cycle, for the broad participation of the entire entrepreneurial ecosystem. The road taken so far to build Sandbox.Rio had challenges of different natures, but it proved that with adequate intersectoral interlocution and dialogue with actors from the innovation environment at the municipal level, it becomes possible to execute a project of this nature. To expand and provide transparency to the studies and lessons learned so far, the Undersecretariat for Regulation and the Business Environment is in the process of preparing a booklet that will explain, in simple and objective language, the step-by-step process for formulating a regulatory sandbox and aspects to be considered by public managers in its preparation.

Anything Else?

For greater active transparency, Rio's City Hall has periodically made available, on a specific website (, all information regarding the selection process and the progress of the regulatory sandbox.

Supporting Videos


  • Implementation - making the innovation happen

Innovation provided by:

Date Published:

4 August 2023

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