The ongoing debate about the coexistence of genetically modified (GM) and non-GM crops in the European Union (EU) mainly focuses on preventive measures needed to keep the adventitious presence of GM material in non-GM products below established tolerance thresholds, as well as on issues covering questions of liability and the duty to redress the incurred economic harm once adventitious mixing in non-GM products has occurred.  By contrast, the interplay between the economic incentives and costs of coexistence has attracted little attention.  The current overemphasis on the technical aspects and cost of coexistence over its economic incentives might lead EU policy-makers to adopt too stringent and rigid regulations on coexistence.  Therefore, we argue for flexible coexistence regulations that explicitly take into account the economic incentives for coexistence.  Our arguments provide a timely and important framework for EU policy-makers, who are currently struggling to implement coherent coexistence regulations in all member states.