Fabrizio Cafaggi

Private Regulation and Legal Integration: The European Example

Private regulation has become a highly debated phenomenon. Previous research has focused mostly on the effectiveness, legitimacy, and governance structure of private regulators at the global level. Few existing analyses have focused on private regulation at the European level, where only questions of interest representation have attracted attention. Analyses of the contribution of private regulation to the process of European legal integration, in particular, are lacking. We seek to fill this gap. From private rules for product safety and for financial markets, such as the Single Euro Payments Area standards, to private rules governing the professions, we observe that private regulation has facilitated and accelerated European legal integration. We argue that in some cases this effect was anticipated, especially by the European Commission, and in those cases the intended effect on European legal integration at least partly explains the rise of private regulation. I other cases, it was an incidental by-product of attempts to address market failures or achieve network legitimacy. In the conclusion, we turn to questions of accountability and legitimacy raised by the increasing importance of private regulators in the Common Market of the EU. Although the EU lacks a body of rules that imposes democratic controls on private regulators, we identify components of European law that can be used as control mechanisms.

The Governance and Regulation of International Finance

This thought-provoking book adds a new perspective to the analysis of how regulation should respond to the global financial crisis of 2008–2009. It focuses on the ‘private’ as opposed to ‘public’ aspect of regulation, and highlights the works of the public–private dialectic in regulation and enforcement.

Private Regulation and Industrial Organisation: The Network Approach

The paper investigates the relation between private transnational regulation through standards and the formation of transnational networks. More particularly, focusing on standards compliance, the analysis is intended to test whether private regulation induces the existence of networks able to: (a) enhance the efficiency and effectiveness of compliance coordination in accordance with a “whole-chain supply approach” to safety regulation; (b) contribute to monitoring along the chain, even when this function is in different ways performed by other players (public authorities, independent certifiers, etc.); (c) possibly and eventually redistribute costs of compliance along the chain. Starting from the observation of contractual practices, mainly within supply chains subject to international certification schemes (for example in the case of food supply chains), different models of networks will be compared depending on: (i) the allocation of monitoring and sanctioning powers (these being assigned to producers, traders or independent actors); (ii) the means of monitoring (peer monitoring v. more formalised monitoring duties); (iii) the types of sanctions (particularly, label/certificate suspension or revocation); (iv) the structure of the network (as based on merely linked contracts or on a mix of contractual and organizational relations).

The Many Features of Transnational Private Rule-Making: Unexplored Relationships between Custom, Jura Mercatorum and Global Private Regulation

Every-day life of businesses and consumers is pervaded by the references to global private standards: from the cars we drive to the computers we use, from the food we eat to the movies we watch. Private rule-making at the transnational level is increasingly gaining scope and traction, quickly expanding in both old and new territories. This is partly the result of weaknesses in conventional international public law and partly the result of the emergence of new modes of governance. Stimulated by the actions of states and private actors, these new modes of governance include public, private, and hybrid instruments.Private actors engage in transnational rulemaking in different forms depending on their objectives, the geographical and functional scope, and the effects of the regimes on the entities being regulated. The fields of application go well beyond those traditionally occupied by ‘jura mercatorum,’ including agriculture, human rights, social and labor regulation, environment, and the more conventional areas, such as finance, banking, professions, and trade, including e-commerce.These private regimes are sector specific but not self-contained. They presuppose the existence of international and domestic institutions that can support their functioning. They interact by both giving rise to conflicts or by mutually reinforcing one another. The premise of the analysis that follows is that of institutional complementarity rather than that of separate and autonomous private orderings. The conceptual puzzle concerns the definition of different types of complementarity between private and public actors. Is the expansion of transnational private rule making simply an evolution of more conventional forms of custom and jus mercatorum or does it depart from these forms of private rule-making? In the latter case is there a common denominator of current forms of transnational private rule-making? How does private rule making correlate with international and domestic public legal orders? Do they constitute separate private orderings? Do they complement, supplement or replace public legal orders? What is the combination between legal and non-legal norms? Not only these questions have theoretical relevance but they also shape important regulatory policy choices at the international level concerning legitimacy, compliance and enforcement of global private standards? Transnational private regulatory regimes – it is contended – do not represent an alternative to jus mercatorum since their functional focus is regulation driven by market failures rather than a set of prescriptions related to individual transactions between market participants. They integrate current public market regulation or contribute to the creation of new markets through market design. The multifarious forms of transnational private rule-making pose daunting questions concerning their origins, functions and scope. This article addresses the different forms of transnational private rule-making; it tries to examine their differences and the consequences for their normative foundations and policy objectives. After a brief historical overview, section I analyses transnational private regulation (TPR), and section II examines usages, customs and jura mercatorum. Section III presents a comparative assessment between TPR and custom. Section IV defines an agenda for future research and it is followed by the conclusion.

Does Private Regulation Foster European Legal Integration

More recently the role of the European regional regulator in the global regulatory space has attracted more attention, opening up a wider debate on the role of regional regimes in global regulation. In particular the slice of the debate relevant for this essay concerns the extent to which regional regulatory systems are drivers of differentiation and can be seen as obstacles of regulatory globalization or, on the contrary, are the pillars of a global system where multiple actors, organized around territorial or functional metrics, contribute to regulatory design and implementation.