Establish a universal regulatory sandbox program

As Passed by the House

136th
General Assembly

Regular
Session
Sub. H. B. No. 176

2025-2026

Representatives Fischer, Lorenz

Cosponsors: Representatives
Ferguson, Newman, Santucci, Thomas, D., Gross, Johnson, Workman,
Abrams, Barhorst, Brennan, Brewer, Claggett, Daniels, Dovilla, Hall,
D., Hall, T., Humphrey, Jarrells, John, LaRe, Lett, Mathews, A.,
Mathews, T., McClain, Peterson, Plummer, Robb Blasdel, Roemer,
Rogers, Salvo, Schmidt, Sigrist, Sims, Stephens, Swearingen, Williams

To
enact sections 1357.01, 1357.02, 1357.03, 1357.04, 1357.05, 1357.06,
1357.07, 1357.08, 1357.09, 1357.10, 1357.11, and 1357.12 of the
Revised Code
to
create a regulatory relief division within the common sense
initiative office and to establish a universal regulatory sandbox
program.

BE
IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section
1.
That
sections 1357.01, 1357.02, 1357.03, 1357.04, 1357.05, 1357.06,
1357.07, 1357.08, 1357.09, 1357.10, 1357.11, and 1357.12 of the
Revised Code be enacted to read as follows:

Sec.
1357.01.
As
used in this chapter:

(A)
"Advisory committee" means the universal regulatory sandbox
program advisory committee established under section 1357.03 of the
Revised Code.

(B)
"Applicable agency" means a department or agency of the
state that by law regulates a business activity and persons engaged
in such business activity, including the issuance of licenses or
other types of authorization, which the regulatory relief division
determines would otherwise regulate a sandbox participant.

(C)
"Business day" means any day of the week, excluding
Saturday, Sunday, and a legal holiday, as defined in section 1.14 of
the Revised Code.

(D)
"Common sense initiative office" means the office
established by the governor under section 107.61 of the Revised Code.

(E)
"Consumer" means a person that purchases or otherwise
enters into a transaction or agreement to receive an offering
pursuant to a demonstration by a sandbox participant.

(F)
"Demonstrate" or "demonstration" means to
temporarily provide an offering in accordance with the provisions of
the universal regulatory sandbox program described in this chapter.

(G)
"Innovation" means the use or incorporation of a new idea,
a new or emerging technology, or a new use of existing technology to
address a problem, provide a benefit, or otherwise offer a product,
production method, or service.

(H)
"Innovative offering" means an offering that includes an
innovation.

(I)(1)
"Product" means a commercially distributed good that is all
of the following:

(a)
Tangible personal property;

(b)
The result of a production process;

(c)
Passed through the distribution channel before consumption.

(2)
"Product" does not include either of the following:

(a)
Beer or wine, as defined in section 4301.01 of the Revised Code;

(b)
Motor vehicles, as defined in section 4501.01 of the Revised Code.

(J)
"Production" means the method or process of creating or
obtaining a good, which may include assembling, breeding, capturing,
collecting, extracting, fabricating, farming, fishing, gathering,
growing, harvesting, hunting, manufacturing, mining, processing,
raising, or trapping a good.

(K)
"Sandbox participant" means a person whose application to
participate in the universal regulatory sandbox is approved in
accordance with this chapter.

(L)
"Service" means any commercial activity, duty, or labor
performed for another person, except for either of the following:

(1)
The activities regulated by Title XLIII of the Revised Code to the
extent that those activities pertain to the distribution or sale of
beer or wine;

(2)
The activities regulated by Chapter 4517. of the Revised Code.

Sec.
1357.02.
(A)
The common sense initiative office shall establish a universal
regulatory sandbox program in consultation with applicable agencies
to enable a person to obtain limited access to the market in this
state to test products or services without obtaining any other
license or authorization that otherwise would be required.

(B)
The governor shall establish a regulatory relief division within the
common sense initiative office for the purposes of administering this
chapter and acting as a liaison between private businesses and
applicable agencies to identify state laws or regulations that could
potentially be waived or suspended under the universal regulatory
sandbox program.

(C)
The regulatory relief division may do all of the following:

(1)
Identify state laws and regulations that unnecessarily inhibit the
creation and success of new companies or industries in this state and
provide recommendations to the governor and the general assembly on
modifying such state laws and regulations;

(2)
Create a framework for analyzing the risk level to the health,
safety, and financial well-being of consumers as a result of
permanently removing or temporarily waiving laws and regulations that
inhibit the creation or success of new and existing companies or
industries in this state;

(3)
Propose potential reciprocity agreements between states that use or
are proposing to use similar universal regulatory sandbox programs as
described in this chapter or Chapter 1355. of the Revised Code;

(4)
Adopt rules in accordance with Chapter 119. of the Revised Code as
necessary to do either of the following:

(a)
Administering the universal regulatory sandbox program, including the
application process and the reporting requirements of sandbox
participants;

(b)
Cooperating and consulting with the superintendent of financial
institutions respecting the regulatory sandbox program authorized by
Chapter 1355. of the Revised Code.

Sec.
1357.03.
(A)
The universal regulatory sandbox program advisory committee is
established within the common sense initiative office. The committee
shall advise and make recommendations to the regulatory relief
division as described in this chapter.

(B)
The committee shall consist of the following members:

(1)
Six members who represent business interests from a variety of
industry clusters, appointed by the governor;

(2)
Three members who represent state agencies that regulate businesses,
appointed by the governor;

(3)
One member of the senate, appointed by the president of the senate;

(4)
One member of the house of representatives, appointed by the speaker
of the house of representatives.

(C)(1)
Members of the committee shall be appointed not later than thirty
days after the effective date of this section. Members of the
committee serve at the pleasure of the member's appointing authority.
Any vacancy in the membership of the committee shall be filled within
sixty days after the vacancy occurs in the same manner as the
original appointment.

(2)
Of the initial appointments made by the governor to the committee:

(a)
Three of the members described in division (B)(1) of this section and
two of the members described in division (B)(2) of this section shall
serve for a term ending the first day of the second calendar year
that begins after the effective date of this section;

(b)
Three of the members described in division (B)(1) of this section and
one of the members described in division (B)(2) of this section shall
serve for a term ending the first day of the fourth calendar year
that begins after the effective date of this section.

(3)
After the initial appointments, terms for all members appointed by
the governor shall be four years, with each term ending on the same
day of the same month as did the term it succeeds.

(4)
Legislative members of the committee shall serve terms of two years
or for the remainder of the member's legislative term, whichever is
less.

(D)
Members of the committee shall serve without compensation but may be
reimbursed for expenses actually incurred in the performance of their
duties, within the limits of funds available to the committee for
such purposes.

(E)
The governor shall select a chairperson for the committee on an
annual basis. The committee shall meet at the call of the
chairperson. The initial meeting shall not be later than thirty days
after the last member is appointed. A majority of the members of the
committee constitutes a quorum for the transaction of the business of
the committee.

(F)
The staff of the regulatory relief division shall provide technical
and administrative support as needed by the committee.

(G)
The committee is not a public body for the purposes of section 121.22
of the Revised Code.

Sec.
1357.04.
On
or before October 1 of the first year that begins after the effective
date of this section, and annually thereafter, the common sense
initiative office shall submit a written report on the activities of
the regulatory relief division to the general assembly in accordance
with section 101.68 of the Revised Code. The report shall include all
of the following:

(A)
Information regarding each participant in the universal regulatory
sandbox program, including which industry each participant represents
and the anticipated or actual cost savings that each participant
experiences;

(B)
Recommended changes to laws or regulations that the regulatory relief
division determines unnecessarily inhibit the creation and success of
new companies or industries;

(C)
Information on the universal regulatory sandbox program's impact on
consumer outcomes;

(D)
Recommended changes to the universal regulatory sandbox program or
the regulatory relief division.

Sec.
1357.05.
(A)
A person that seeks to participate in the universal regulatory
sandbox program shall apply to the regulatory relief division in a
form and manner prescribed by the division. The application shall, at
minimum, include all of the following:

(1)
Confirmation that the applicant is subject to the jurisdiction of the
common sense initiative office, which may be demonstrated through
incorporation, residency, an agreement with the office by which the
applicant agrees to be subject to the laws and courts of this state
relating to any action arising out of the applicant's demonstration
of a product or service in the universal regulatory sandbox, or
otherwise;

(2)
Confirmation that the applicant has established a physical or virtual
location in the state, from which the demonstration of an innovative
offering will be developed and performed and where all required
records, documents, and data will be maintained;

(3)
Relevant personal and contact information for the applicant,
including legal names, addresses, telephone numbers, electronic mail
addresses, web site addresses, and other information that may be
required by the regulatory relief division;

(4)
Disclosure of criminal convictions, if any, of the applicant and
other participating personnel;

(5)
A description of the innovative offering to be demonstrated,
including statements regarding all of the following:

(a)
How the offering is subject to licensing, legal prohibition, or other
authorization requirements outside of the universal regulatory
sandbox;

(b)
Each law or regulation that the applicant seeks to have waived or
suspended while participating in the universal regulatory sandbox
program;

(c)
How the offering would benefit consumers;

(d)
How the offering is different from other offerings available in this
state;

(e)
What risks might exist for consumers that use or purchase the
offering;

(f)
How participating in the regulatory sandbox would enable a successful
demonstration of the offering;

(g)
A description of the proposed demonstration plan, including estimated
time periods for beginning and ending the demonstration;

(h)
Recognition that the applicant will be subject to all laws and
regulations pertaining to the applicant's offering after conclusion
of the demonstration;

(i)
How the applicant will end the demonstration and protect consumers if
the demonstration fails.

(6)
A list of the state agencies that regulate the applicant's business;

(7)
Other information that may be required by the regulatory relief
division.

(B)
The regulatory relief division shall, upon request, consult with
persons interested in participating in the universal regulatory
sandbox program and assist such persons in preparing an application,
including by helping to identify state agencies that regulate the
person's business and laws or regulations that could have an adverse
impact on the success of that business and which the person may seek
to have waived or suspended while participating in the universal
regulatory sandbox program.

(C)
The governor may require an application fee to offset the costs of
the regulatory relief division and the common sense initiative office
in administering the universal regulatory sandbox program. All fees
collected under this section shall be deposited to the universal
regulatory sandbox program fund, which is created in the state
treasury, and used for the purposes of this chapter.

(D)
An applicant shall file a separate application for each innovative
offering that the applicant seeks to demonstrate.

(E)
After an application is filed, the regulatory relief division shall
do all of the following:

(1)
Keep confidential the contents of the application and any related
information provided by the applicant;

(2)
Consult with each applicable government agency that regulates the
applicant's business regarding the application and whether more
information is needed from the applicant;

(3)
Seek any additional information from the applicant that the
regulatory relief division determines is necessary.

(F)
Not later than five business days after the date a complete
application is received by the regulatory relief division, the
division shall do both of the following:

(1)
Review the application and refer it to each applicable state agency
that regulates the applicant's business;

(2)
Provide the applicant with an acknowledgment of receipt of the
application and the identity and contact information for each state
agency to which the application has been referred for review.

(G)
Applications received under this section are not public records for
the purposes of Chapter 149. of the Revised Code.

Sec.
1357.06.
(A)(1)
Subject to division (A)(2) of this section, not later than thirty
business days after the date on which an applicable agency receives a
complete application under section 1357.05 of the Revised Code for
review, the applicable agency shall provide a written report to the
regulatory relief division of the applicable agency's findings. The
report shall include both of the following:

(a)
A description of any identifiable, likely, and significant harm to
the health, safety, or financial well-being of consumers that the law
or regulation the applicant seeks to waive or suspend protects
against;

(b)
A recommendation to the regulatory relief division that the applicant
either be admitted or denied entrance into the universal regulatory
sandbox.

(2)
The applicable agency may extend the deadline for delivering the
written report required by division (A)(1) of this section by an
additional five business days by providing notice of the extension to
the regulatory relief division. The applicable agency shall not
extend the deadline more than once for each application.

(3)
If the applicable agency recommends an applicant under this section
be denied entrance into the universal regulatory sandbox, the written
report shall include a description of the reasons for the
recommendation, including why a temporary waiver or suspension of the
relevant laws or regulations would potentially significantly harm the
health, safety, or financial well-being of consumers or the public,
or create unreasonable expenses for the taxpayers of this state, and
the likelihood of such harm or expenses.

(4)
If the applicable agency determines that the consumer's or public's
health, safety, or financial well-being can be protected through less
restrictive means than the existing relevant laws or regulations,
then the applicable agency shall provide a recommendation of how that
may be achieved.

(5)
If an applicable agency fails to deliver a written report as required
by this section, the regulatory relief division shall proceed as
though the applicable agency does not object to the temporary waiver
or suspension of the relevant laws or regulations for an applicant
seeking to participate in the universal regulatory sandbox.

(B)
The regulatory relief division shall immediately reject an
application if any of the following apply:

(1)
An applicable agency determines, in the agency's sole discretion,
that the applicant's offering fails to comply with standards or
specifications required by federal law or regulations;

(2)
An applicable agency timely recommends that the applicant be denied
entrance to the universal regulatory sandbox in the agency's written
report under division (A) of this section and provides the applicant
with the reasons for that determination in accordance with that
division;

(3)
The regulatory relief division determines that the applicant is
better suited for the regulatory sandbox program authorized by
Chapter 1355. of the Revised Code;

(4)
The applicant or any person who seeks to participate with the
applicant in demonstrating an offering has been convicted, entered a
plea of nolo contendere, or entered a plea of guilty or nolo
contendere held in abeyance, for any crime involving significant
theft, fraud, or dishonesty;

(5)
The applicant's offering has previously been demonstrated in the
universal regulatory sandbox.

(C)(1)
The regulatory relief division shall provide all applications
received under section 1357.05 of the Revised Code and written
reports received under this section, other than those rejected under
division (B) of this section, to the universal regulatory sandbox
program advisory committee.

(2)
The universal regulatory sandbox program advisory committee shall
meet to review an application and any corresponding reports not less
than thirty days, and not more than one hundred twenty days, after
receiving the application from the regulatory relief division under
division (C)(1) of this section.

(3)
Subject to divisions (C)(2) and (4) of this section, the universal
regulatory sandbox program advisory committee shall meet not less
than one time per calendar quarter.

(4)
The committee may cancel a meeting otherwise required by division
(C)(3) of this section if no applications are available for review.

(5)
After reviewing an application and the corresponding reports of
applicable agencies, the committee shall provide the governor and the
common sense initiative office the committee's recommendation that
the applicant either be admitted or denied entrance into the
universal regulatory sandbox.

(D)
The universal regulatory sandbox program advisory committee shall
consider all of the following in determining whether to recommend
that an applicant be admitted to the universal regulatory sandbox:

(1)
Whether the applicable agency has previously issued a license or
other authorization to the applicant;

(2)
Whether the applicable agency has previously investigated,
sanctioned, or pursued legal action against the applicant;

(3)
Whether a competitor to the applicant is or has been a universal
regulatory sandbox participant;

(4)
Whether the applicant's plan adequately protects consumers from
potential harm;

(5)
The risk of harm to consumers as compared to the potential benefits
of the applicant's participation in the universal regulatory sandbox.

(E)(1)
The regulatory relief division, the common sense initiative office,
or the governor may deny any application submitted under this chapter
for any reason, including if the division, office, or governor
determines that the preponderance of evidence demonstrates that
suspending or waiving enforcement of a law or regulation would cause
a significant risk of harm to consumers or residents of the state.

(2)
If the division, office, or governor denies an application under
division (E)(1) or (B) of this section, the division shall provide to
the applicant a written description of the reasons for not allowing
the applicant to participate in the universal regulatory sandbox.

(3)
The division's, office's, or governor's determination to deny an
application is final.

(F)
Nothing in this section shall be construed to prohibit an applicant
who has previously participated in the universal regulatory sandbox
from doing so again with a different offering.

Sec.
1357.07.
(A)(1)
Subject to division (B) of section 1357.06 of the Revised Code, upon
receiving a recommendation to approve an application from the
universal regulatory sandbox program advisory committee, the
regulatory relief division, in consultation with the governor, may
enter into a written agreement with the applicant admitting the
applicant to the universal regulatory sandbox and describing the
specific laws and regulations that are waived or suspended as part of
the applicant's participation therein.

(2)
The sandbox participant may demonstrate the offering described in the
sandbox participant's application, as described in the agreement, for
twenty-four months following the date the agreement is entered.

(3)
An agreement under this section that waives or suspends a law or
regulation does so only with respect to consumers who are residents
of this state.

(4)
An agreement under this section does not restrict a sandbox
participant that holds a license or other authorization in another
state or jurisdiction from acting in accordance with that license or
other authorization.

(B)
The regulatory relief division shall not enter into a written
agreement with an applicant that waives or suspends either of the
following:

(1)
Any tax levied by this state or a taxing authority of this state, as
defined in section 5705.01 of the Revised Code;

(2)
A law or regulation that allows a consumer to seek restitution in the
event that the consumer is harmed.

(C)
A sandbox participant is deemed to possess an appropriate license or
other authorization under the laws of this state for the purposes of
any provision of federal law requiring licensure or other
authorization by the state.

(D)
Subject to division (E) of this section, all of the following apply:

(1)
During the demonstration period, a sandbox participant is not subject
to the enforcement of state laws or regulations waived or suspended
pursuant to the written agreement between the regulatory relief
division and the sandbox participant.

(2)
A prosecutor shall not file or pursue charges pertaining to a law or
regulation waived or suspended pursuant to that agreement that occurs
during the demonstration period.

(3)
A state agency shall not file or pursue any punitive action against a
sandbox participant, including a fine or license suspension or
revocation, for the violation of a law or regulation waived or
suspended pursuant to that agreement that occurs during the
demonstration period.

(E)
A sandbox participant does not have immunity related to any criminal
offense committed during the sandbox participant's participation in
the universal regulatory sandbox.

(F)
By written notice, the regulatory relief division may end a sandbox
participant's participation in the universal regulatory sandbox at
any time and for any reason, including if the division, the common
sense initiative office, or the governor determines that a sandbox
participant is not operating in good faith to bring an innovative
offering to market.

(G)
Neither the regulatory relief division nor its employees are liable
for any business losses or the recouping of application expenses or
other expenses related to the regulatory sandbox, including either of
the following:

(1)
Denying an applicant's application to participate in the universal
regulatory sandbox for any reason;

(2)
Ending a sandbox participant's participation in the regulatory
sandbox at any time and for any reason.

Sec.
1357.08.
(A)
Before demonstrating an offering to a consumer, a sandbox participant
shall disclose all of the following to the consumer:

(1)
The name and contact information of the sandbox participant;

(2)
That the offering is authorized pursuant to the universal regulatory
sandbox and, if applicable, that the sandbox participant does not
have a license or other authorization to provide an offering under
state laws that regulate offerings outside of the universal
regulatory sandbox;

(3)
That the offering is undergoing testing and may not function as
intended and may expose the consumer to certain risks as identified
by the applicable agency's written report;

(4)
That the provider of the offering is not immune from civil liability
for any losses or damages caused by the offering;

(5)
That the provider of the offering is not immune from criminal
prosecution for violations of state law or regulations that are not
suspended or waived as allowed by the universal regulatory sandbox;

(6)
That the offering is a temporary demonstration that may be discounted
at the end of the demonstration period;

(7)
The expected end date of the demonstration period;

(8)
That a consumer may contact the regulatory relief division and file a
complaint regarding the offering being demonstrated and provide the
regulatory relief division's telephone number and web site address
where a complaint may be filed.

(B)
The disclosures required by division (A) of this section shall be
provided to a consumer in a clear and conspicuous form and, for an
internet or application-based offering, a consumer shall acknowledge
receipt of the disclosure before any transaction may be completed.

(C)
The regulatory relief division may require that a sandbox participant
make additional disclosures to a consumer.

Sec.
1357.09.
(A)
At least thirty days before the end of the demonstration period, a
sandbox participant shall either seek an extension in accordance with
section 1357.10 of the Revised Code or notify the regulatory relief
division that the sandbox participant will exit the regulatory
sandbox and discontinue the sandbox participant's demonstration after
the day on which the demonstration period ends.

(B)
Subject to division (C) of this section, if the regulatory relief
division does not receive the notification required by division (A)
of this section, the regulatory sandbox demonstration period ends
twenty-four months following the date the agreement described under
section 1357.07 of the Revised Code is entered.

(C)
If a demonstration includes an offering that requires ongoing duties,
the sandbox participant shall continue to fulfill those duties after
the regulatory sandbox demonstration period ends.

Sec.
1357.10.
A
sandbox participant may request an extension of the universal
regulatory sandbox demonstration period not later than thirty days
before the end of that period. The regulatory relief division shall
grant or deny a request for an extension before the end of the
demonstration period. If the regulatory relief division grants the
request, the division shall specify the duration of the extension,
which shall not be more than twelve months after the date the
regulatory sandbox demonstration period would have otherwise ended.
The regulatory relief division shall not approve more than five
extensions, each having a duration of not more than twelve months,
for the same sandbox participant respecting the same demonstration.

Sec.
1357.11.
(A)
A sandbox participant shall retain records, documents, and data
produced in the ordinary course of business regarding an offering
demonstrated in the universal regulatory sandbox.

(B)
If a sandbox participant ceases to provide an offering before the end
of a demonstration period, the sandbox participant shall notify the
regulatory relief division and each applicable agency and report on
actions taken by the sandbox participant to ensure consumers have not
been harmed as a result. The regulatory relief division shall
establish quarterly reporting requirements for a sandbox participant,
including information about any consumer complaints.

(C)
The regulatory relief division may request records, documents, and
data from a sandbox participant and, upon the regulatory relief
division's request, the sandbox participant shall make such records,
documents, and data available for inspection by the regulatory relief
division.

(D)
The sandbox participant shall notify the regulatory relief division
and each applicable agency of any incidents that result in harm to
the health, safety, or financial well-being of a consumer. If a
sandbox participant fails to notify the regulatory relief division
and each applicable agency of any incidents as described in division
(D)(1) of this section, or the regulatory relief division or an
applicable agency has evidence that significant harm to a consumer
has occurred, the regulatory relief division may immediately remove
the sandbox participant from the universal regulatory sandbox.

(E)
Not later than thirty days after the date on which a sandbox
participant exits the regulatory sandbox, the sandbox participant
shall submit a written report to the regulatory relief division and
each applicable agency describing the sandbox participant's
demonstration, including all of the following:

(1)
Any incidents of harm to consumers;

(2)
Any legal action filed against the sandbox participant as a result of
the participant's demonstration;

(3)
Any complaints filed with an applicable agency as a result of the
sandbox participant's demonstration.

(F)
Not later than thirty days after the date on which an applicable
agency receives a quarterly reporting or written report from a
sandbox participant as required by this section, the applicable
agency shall provide a written report to the regulatory relief
division on the demonstration that describes any statutory or
regulatory reform the applicable agency recommends as a result of the
demonstration.

(G)
The regulatory relief division may remove a sandbox participant from
the universal regulatory sandbox at any time if the regulatory relief
division determines that a sandbox participant has engaged in, is
engaging in, or is about to engage in any practice or transaction
that is in violation of this chapter or that constitutes a violation
of a law or regulation for which suspension or waiver has not been
granted.

Sec.
1357.12.
(A)
The regulatory relief division shall create and maintain a publicly
accessible page on the common sense initiative office's web site that
invites residents and businesses in this state to make suggestions
regarding laws and regulations that could be modified or eliminated
to reduce the regulatory burden of residents and businesses in the
state.

(B)
On at least a quarterly basis, the regulatory relief division shall
compile the results of suggestions from the web page and provide a
written report to the governor and the general assembly, in
accordance with section 101.68 of the Revised Code, that describes
the most common suggestions.

(C)
In creating the report, the regulatory relief division and the
advisory committee shall ensure that private information of residents
and businesses that make suggestions on the web page is not made
public. The regulatory relief division may evaluate the suggestions
and provide analysis and suggestions regarding which state laws and
regulations could be modified or eliminated to reduce the regulatory
burden of residents and businesses in the state while still
protecting consumers.