The Promise of Charter Zones

Metropolis
6 min readMay 21, 2023

A Charter City, according to the Charter City Institute is “a new city granted special jurisdiction to create a new governance system and enact policy reforms. Charter cities can help improve governance in a limited geographic area by giving local officials authority to implement best legal and administrative practices and commercial regulations.”

Metropolis is a legal and technology innovation company that has been developing upon these ideas and is in the process of establishing its own charter zone.

What are the benefits of a Charter Zone?

The purpose of charter cities and zones is to promote experimentation with innovative policy ideas by offering a flexible regulatory environment that fosters competition between businesses and industries. This way, they can attract entrepreneurs, investors, and skilled professionals from all around the world who share common interests in innovation. We believe the primary benefit of a charter zone is the ability to start from scratch, not only in terms of land development but even more importantly in terms of the ability to set a comprehensive vision for the type of people, activities, and purpose for such a place. Beyond regulatory innovation, a newly developed zone creates the opportunity to envision systems and infrastructure from the ground up, from energy and water systems, to layouts and housing.

Impact:

A charter zone can bring immense benefits to its host nation, including foreign investment, domestic technological development, improved local job opportunities, and shared benefits of revenues generated by the zone. Another notable benefit is the potential for increased access to high-quality healthcare and education resources. Imagine a charter zone that includes state-of-the-art healthcare facilities, and a small university campus. These sorts of modern facilities can greatly improve the quality of life and opportunities for local residents in the community or adjacent areas of the host nation. As economic migration trends continue, those host nations that create compelling solutions via charter zones will be best positioned to attract high-quality expats and their corporations, and the associated benefits they can bring.

Economic migration trends point toward an exodus from countries that limit freedoms.

Differentiation:

It’s incumbent upon newly developed zones to differentiate themselves by providing legal frameworks and other advantages that increase the value of the land beyond its soil and resources. Special policies that encourage innovation in blockchain, fintech, life extension and numerous other industries can be adopted and tailored to meet the needs of modern global entrepreneurs. With our Digital Nation Stack — an ecosystem of digital government services, we aim to enable seamless regulatory processes and provide essential services such as identity, corporate registration, banking, and more. A large collective community formed around these digital nation services, will be prime candidates to become early members of our charter zone.

Complex immigration barriers in the US are forcing global talent to search for alternatives.

To jumpstart the development of these nascent zones, we will target the global diaspora of tech nomads and web3 innovators as early adopters. There are an estimated 35 million digital nomads globally and over 300 million cryptocurrency holders who will help our charter zone(s) to “cross the chasm” from a group of early adopters and enthusiasts to mass market adoption.

Legal Wrapper:

Another method to enhance the competitive advantage of a charter zone is via legal innovation. With approval from the national level for a special economic zone, more autonomy can be granted to the zone and its localized management, for things such as building codes, enabling exempted corporations to reside in the zone while still meeting non-resident requirements, specialized tax incentives to encourage investment and growth, and the ability to create policies and regulations at the state level that advantage companies in different fields like medical research, life extension, renewable energy, agriculture, artificial intelligence, and others. The ability to rapidly adopt model regulations from other leading jurisdictions inside this shell, combined with other newly developed systems built from scratch, will enable the zone to raise its competitive profile and attract companies that may have otherwise had regulatory ambiguity in other jurisdictions. These companies may choose to first establish their presence virtually, via a digital corporation, but with the right incentives, including blocks of residency grants for employees based on FDI, a portion of them will establish a physical presence in the zone. These participants will bring with them high-quality, established residents to form a nucleus of early adopters that will populate and grow the charter zone, helping to create jobs locally and build momentum for other residents and companies that migrate there.

Bootstrapping — Starting Small & Humble:

Rome wasn’t built in a day, and we see this as a vision that will play out over years. Instead of a master-planned development, we aim to develop piece by piece beginning with low-density flexible units for residential and small-scale commercial development. This approach allows for more flexibility as plans evolve and iterate and will also reduce the environmental impact of a given charter zone.

Charter Zone Innovation Village, a Tabula Rasa for Innovation

By starting small in one corner of a proposed zone and making this information available online, interested parties will be able to observe progress and reserve adjacent areas for future development. This model is conducive to a more organic, horizontal spread of the physical zone, while leaving room for progressively more dense and vertical development as the zone proves itself out over time as a viable destination and successful zone. As more property is reserved, the relative value of the land and zone in totality is increased, rewarding early adopters who commit to populating the zone. In addition to the direct assets held by early adopters, those that purchase plots in the zone should receive a commensurate portion of a collective value token (e.g. METRO) granting future voting rights and zone profit streams to be shared among the community. We believe this approach allows for a healthy alignment of personal interests and the collective interests of zone residents and stakeholders.

Future Vision:

We aim to develop this model beginning with a pilot zone in Palau, and ultimately allow this to serve as a template for future zones, both in terms of the legal and technology solutions we use as well as the financing and development model. We envision a series of distributed autonomous creation hubs that will become engines of growth and innovation, scattered throughout the world and helping to power “Civilization 2.0”.

What will Civilization 2.0 cities look like?

Given the global instability humanity is experiencing under the current world order, these hubs can ultimately evolve into self-sufficient lifeboats (a modern version of Noah’s Ark) and develop robust resilience for humanity in case of global catastrophic events. We are developing this parallel civilization (our “castle in the air”) piece by piece. First we imagine it and dream it. Then we bring it into the physical world. Stay tuned to see what we have in store!

Follow us on Twitter: https://twitter.com/metropolishub

Join our Digital Palau community: https://t.me/digitalpalau

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