PART FOUR
HORIZONTAL CONFLICTS: THE TENSION BETWEEN
PUBLIC AND PRIVATE TRANSNATIONAL NORMS
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RULES OF RECOGNITION: A LEGAL CONSTRUCTIVIST APPROACH TO
TRANSNATIONAL PRIVATE REGULATION
Harm Schepel
1. Introduction
A large part of the accounting, quality, safety, social and environmental
standards that regulate the global economy is set and monitored by private or hybrid associations and networks.1 These ‘new global rulers’
approach the business of rulemaking according to highly formalized
procedures laid down in hefty, detailed and regularly updated tomes of
codes, manuals and ‘standards for standards.’2 Even if important differences exist between these, there is a surprisingly robust common core of
requirements and principles: elaboration of a draft by consensus in a technical committee with a composition representing a balance of interests;
a round of public notice-and-comment of that draft with the obligation
on the committee to take received comments into account; a ratification
vote with a requirement of consensus, not just a majority, among the constituent members of the standards body; and an obligation to review standards periodically. A growing body of work investigates and reflects on
1 These include the International Organization for Standardization (ISO), the
International Accounting Standards Board (IASB), and the members of the International
Social and Environmental Accreditation and labeling Alliance (ISEAL), among them the
Forest Stewardship Council, the Rainforest Alliance, the Marine Stewardship Council, and
the Fair Trade Labelling Organization. See generally e.g. David Vogel, ‘Global Private
Business Regulation’ 11 Annual Review of Political Science (2008) 261, and Tim Büthe and
Walter Mattli, The New Global Rulers: The Privatization of Regulation in the World Economy
(Princeton, Princeton University Press 2011).
2 See e.g. International Social and Environmental Accreditation and Labelling Alliance,
Code of Good Practice for the Setting of Social and Environmental Standards (2010), and the
International Organization for Standardization, ISO/IEC Directives, Part I: Procedures
for the technical work (2012). The latter are greatly influenced by, and influence, the regulations of national standards bodies. See for example the American National Standards
Institute, ANSI Essential Requirements: Due process requirements for American National
Standards (2010); the European Standards Organizations’ CEN/CENELEC Internal regulations Part 2: Common Rules for Standardization Work (2012); the German DIN 820 (2009),
and the British Standards Institute, BS 0:2011, A standard for standards: Principles of standardization (2011).
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these decision-making procedures under various metrics and concepts of
accountability and legitimacy.3 Although assessments about compliance
and effect are far from uniformly positive,4 there is little doubt about the
mechanisms underlying the diffusion of these core principles; standardsetters strive for their standards to be widely used and public recognition
is a necessary condition for widespread application. Adherence to fundamental principles of administrative process, in turn, is a necessary condition for public recognition.5
However ‘legitimate’ the private regulatory process is, private standards
are usually denied the status of law. Their relevance and legal effect
come filtered through what have been termed ‘mechanisms of degradation’;6 standards are either incorporated into the legal system as law by
3 See e.g. Errol Meidinger, ‘The Administrative Law of Global Public-Private Regulation:
The Case of Forestry’ 17 European Journal of International Law (2006) 47; Lars Gulbrandsen,
‘Accountability Arrangements in Non-State Standards Organizations: Instrumental Design
and Imitation’ 15 Organization (2008) 563; Alan Richardson and Burkhard Eberlein,
‘Legitimating Transnational Standard-setting: The Case of the International Accounting
Standards Board’ 98 Journal of Business Ethics (2011) 217; and Nicolas Hachez and
Jan Wouters, ‘A Glimpse at the Democratic Legitimacy of Private Standards: Assessing
the Public Accountability of GLOBAL G.A.P.’ 14 Journal of International Economic Law
(2011) 677.
4 The potential for legitimate transnational private governance is, however, widely
seen to lie in the very absence of traditional democratic hierarchical control: “the
necessity for transnational private regulatory regimes to find alternative sources of
legitimacy based in procedural and other mechanisms may enable them to achieve
stronger legitimacy than inter-governmental regimes.” Colin Scott, Fabrizio Cafaggi
and Linda Senden, ‘The Conceptual and Constitutional Challenge of Transnational
Private Regulation’ 38 Journal of Law and Society (2011) 1, at 19. For ‘comparisons’ of
legitimacy in public and private settings, see e.g. Steven Bernstein, ‘Legitimacy in
intergovernmental and non-state global governance’ 18 Review of International Political
Economy (2011) 17; and Ingo Take, ‘Legitimacy in Global Governance: International,
Transnational and Private Institutions Compared’ 18 Swiss Political Science Review
(2012) 220.
5 A striking example is the recent effort of ISO to distinguish its work from that of the
ISEAL Alliance on the basis of its adherence to WTO disciplines. “Any organization can
claim to have developed a ‘standard’…but not all standards are created equal.” ISO,
International standards and ‘private standards’, Geneva 2010. Compare, just for fun,
Columbia Specialty Co v Breman (1949) 90 Cal App 2d 372, 378: “Manifestly, any association
may adopt a ‘code’ but the only code that constitutes the law is a code adopted by the
people through the medium of their legislatures.”
6 Gralf-Peter Callies and Peer Zumbansen, Rough Consensus and Running Code- A
Theory of Transnational Private Law (Oxford, Hart, 2010) at 101, on the basis of the mechanisms identified and described by Ralf Michaels, ‘The Re-State-ment of Non-State Law’ 51
Wayne Law Review (2005) 1209, at 1228 et seq. As these authors are aware, Robert Cover
famously called the tendency ‘jurispathos.’ Robert Cover, ‘Nomos and Narrative’ 97 Harvard
Law Review (1983) 4.
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a legal approach to private regulation191
reenacting the rulemaking process as legislative process,7 or they are
reduced to mere facts—8 Tertium non datur.9
The problem with this bright-line jurisprudence is that, to turn a phrase,
it ceases to make demands on the world.10 One can hardly place normative requirements on the production of facts, even ‘legal facts.’11 And applying a coat of constitutionally approved veneer to private rulemaking may
conceal cracks in the wall, but does nothing to improve construction.12
This contribution will try and advance a legal constructivist approach to
private transnational governance. Analytically, the argument is that the
law/non-law distinction is itself a legal operation, which does not necessarily unfold according to the traditional constitutional hierarchical criteria of authority and validity. Normatively, the argument is that legitimate
7 The most perennial example of this is surely still the Kansas Supreme Court in State v
Crawford 177 P 360, 361 (Kan 1919) (“If the Legislature desires to adopt a rule of the National
Electrical Code as a law of this state, it should copy that rule, and give it a title and an enacting clause, and pass it through the Senate and the House of Representatives by a constitutional majority and give the Governor a chance to approve or veto it, and then hand it over
to the secretary of state for publication.”).
8 The most prominent example of this strategy is the Appellate Body’s refusal to read a
procedural requirement into the definition of ‘international standards’ in the WTO
Agreement on Technical Barriers to Trade. EC- Sardines, WT/DS 231/AB/R, 26 September
2002. See below. On the role of standards in the WTO regime, see e.g. Filippo Fontanelli,
‘ISO and Codex standards and international trade law: what gets said is not what’s heard’
60 International and Comparative Law Quarterly (2011) 895, and Steven Bernstein and Erin
Hannah, ‘Non-State Global Standard Setting and the WTO: Legitimacy and the Need for
Regulatory Space’ 11 Journal of International Economic Law (2008) 575.
9 Gunther Teubner, ‘The King’s Many Bodies: The Self-Deconstruction of Law’s
Hierarchy’ 31 Law and Society Review (1997) 763, at 768.
10 Martti Koskenniemi, ‘The Fate of Public International Law: Between Politics and
Technique’ 70 Modern Law Review (2007) 1, at 23 (criticizing legal pluralism for ‘the ways in
which it ceases to make demands on the world.’).
11 See Joost Pauwelyn, ‘Is it International Law or Not and Does It Even Matter?’ Chapter 6
in Joost Pauwelyn, Ramses Wessels and Jan Wouters (eds.), Informal International
Lawmaking (Oxford, Oxford University Press, 2012) (distinguishing between ‘being law’
and ‘having legal effects’, and between law, facts and ‘legal facts’).
12 In the European Union, the IAS Regulation obliges all publicly traded companies in
the European Union to prepare their accounts in accordance with international accounting standards issued or adopted by the International Accounting Standards Board, a private international body. Articles 2 and 4, Regulation 1606/2002 on the application of
international accounting standards, (2002) OJ L 243/1. These standards end up as
Community law in the form of Regulations if the European Commission ‘endorses’ them,
acting on the opinion of the regulatory committee on the view of a non-governmental
advisory group which, in turn, gives its perspective on the work of a private body which
then gives its opinion on the actual standards produced by the IASB. Ibid., Article 6(2); and
on the Commission decision setting up a Standards Advice Review Group to advice the
Commission on the objectivity and neutrality of the European Financial Reporting
Advisory Group’s (EFRAG’s) Opinion, (2006) L 199/3.
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global governance is largely a function of the interaction of normative
orders.
If there is any merit to this approach, it stems from three main features.
First, it draws on the main strengths of ‘legal pluralism’ by recognizing that
‘lawmaking’ is not limited to the public institutions recognized as such by
the historical frame of law and state. Second, it resolves one of the persistent problems of legal pluralism by taking the concept of ‘law’ seriously
and not reducing it to mere fact devoid of all normative aspiration. Third,
it should manage to overcome the painful divorce between ‘the question
of law’ and ‘the question of legitimacy’; in a legal constructivist approach,
the sociological question of law’s recognition of extra-constitutional rulemaking is indissolubly linked with the normative inquiry into the conditions of legitimate lawmaking beyond the state. The argument evidently
owes an enormous debt to various strands of the work of Gunther Teubner,
culminated in Constitutional Fragments.13 Legal pluralism, reflexive law
and a constructivist epistemology of law constitute elements of ‘societal
constitutionalism’, rendered here in a debased and systems-theoretically
suspect version that insists that law production by private associations
should be politicized from within by the operations of normative orders
which recognize or deny each other as law according to criteria intrinsic
to law.
The argument unfolds as follows. Section 2 will draw on components of
economic sociology associated with Karl Polanyi’s concept of ‘embeddedness’ to unhinge the idea that ‘the global market’ is a normative void
that territorially bounded, emasculated states are struggling to regulate.
Section 3 will attempt to sketch some consequences related to this for
the function of law. Section 4 will then address ‘the question of law’ under
conditions of legal pluralism, which section 5 will seek to make more
concrete.
2. The Embedded Market
Freer Markets, More Rules,14 the title of Steven Vogel’s classic work evokes
a central paradox of the denationalized economy where neoliberal globalization comes not with the unleashing of market forces through massive
13 Gunther Teubner, Constitutional Fragments (Oxford, Oxford University Press,
2012).
14 Steven Vogel, Freer Markets, More Rules (Ithaca, Cornell University Press, 1998).
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deregulation, but with the expansion of regulatory rules and agents.15 This
is usually seen as a result of changes in the nature and exercise of political
authority on the economy: as the State ‘retreats’, it leaves ‘a gap’ to be filled
with a myriad of public and private regulators both within and without
States. The lack of hierarchy and legal unity, then, leads to new forms and
mechanisms of regulation that go under the name of ‘governance.’16
Coordination problems of governance in the transnational realm, in turn,
are to be solved by ‘orchestration.’17
It might be useful to change perspective and instead of asking why and
how society wants—or needs—to regulate markets, we could ask why
and how markets need to be regulated. After all, we are all Polanyians now:
it seems nowadays almost acceptable even among economists to propound that “markets are not self-creating, self-regulating, self-stabilizing,
or self- legitimizing.”18
The new institutional economics has labored one important aspect of
this: markets need institutions, in North’s famous formulation, as ‘rules
of the game.’19 Without these—property rights, contract, third-party
enforcement, and, importantly, also ‘informal rules’—20 markets could
not exist.21 Polanyi’s concept of the ‘embeddedness’ of markets is
15 See e.g. David Levi-Faur, ‘The Global Diffusion of Regulatory Capitalism’ 598 Annals
of the American Academy of Political and Social Science (2005) 12, Marc Schneiberg and Tim
Bartley, ‘Organizations, Regulation, and Economic Behavior: Regulatory Dynamics and
Forms from the Nineteenth to Twenty-first Century’ 4 Annual Review of Law and Social
Science (2008) 31, and Marie-Laure Djelic, ‘From the Rule of Law to the Law of Rules: The
Dynamics of Transnational Governance and Their Local Impact’ 41 International Studies of
Management and Organization (2011) 35.
16 One of the better expositions of these ‘transformations of global governance’ is Sol
Picciotto, Regulating Global Corporate Capitalism (Cambridge, Cambridge University
Press, 2011), Chapter 1.
17 Kenneth Abbott and Duncan Snidal, ‘Strengthening International Regulation
Through Transnational New Governance: Overcoming the Orchestration Deficit’ 42
Vanderbilt Journal of Transnational Law (2009) 501. But see Jonathan Zeitlin, ‘Pragmatic
Transnationalism: Governance Across Borders in the Global Economy’ 8 Socio-Economic
Review (2011) 187.
18 Dani Rodrik, The Globalization Paradox: Why Markets, States and Democracy Can’t
Coexist (Oxford, Oxford University Press, 2011) 22. Rodrik does still feel the need to italicize
the statement.
19 Douglass North, Institutions, Institutional Change, and Economic Performance
(Cambridge, Cambridge University Press, 1990). The other locus classicus is Oliver
Williamson, The Economic Institutions of Capitalism (New York, Free Press, 1985).
20 Here things become notoriously complicated. See e.g. Geoffrey Hodgson, ‘What Are
Institutions?’ 40 Journal of Economic Issues (2006) 1.
21 This new institutionalism is particularly influential in issues of law and economic
development. See e.g. Kenneth Dam, The Law-Growth Nexus: The Rule of Law and Economic
Development (Washington, Brookings, 2006), and Robert Cooter and Hans-Bernd Schäfer,
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sometimes held to refer to no more than “one of the more tiresome
attempts to reinvent an 18th century wheel,”22 the fact that markets
need social and institutional support.23 Other times, the concept is
used as a (historical) variable to measure the degree of ‘marketness’ in
society,24 and when coupled with Polanyi’s equally famous thesis of the
‘double movement,’ the argument then is that all conscious efforts to ‘disembed’ will sooner or later be countered by political efforts to ‘re-embed’
the market.25 One version of this simply equates ‘re-embedding’ with
‘re-regulation’;26 whereas another would hold the countermovement of
‘re-embedding’ to be a functional necessity for the market society itself in
that it maintains or rebuilds the social cohesion and integration without
which the market could not exist in the first place.27
In both these understandings of embeddedness, the rules work on
the market from the outside: whether their aim is to institute or to tame
markets, rules and institutions thus understood leave intact an analytically distinct sphere of economic activity where the laws of neoclassical
economics apply.28 But as a mechanism to coordinate economic activity,
Salomon’s Knot: How Law Can End the Poverty of Nations (Princeton, Princeton University
Press, 2011).
22 Gareth Dale, ‘Lineages of Embeddedness: On the Antecedents and Successors of a
Polanyian Concept’, 70 American Journal of Economics and Sociology (2011) 306, at 331.
23 A good treatment of ‘institutionalism’ is Wolfgang Streeck, ‘Taking Capitalism
Seriously: Towards an Institutionalist Approach to Contemporary Political Economy’ 9
Socio-Economic Review (2011) 137.
24 On Polanyi’s own use of the concept in this way, see Kurtuluş Gemici, ‘Karl Polanyi
and the Antinomies of Embeddedness’ 6 Socio-Economic Review (2008) 5.
25 On the ‘countermovement’, see e.g. Ronaldo Munck, ‘Globalization and Contestation:
A Polanyian Problematic’ 3 Globalizations (2006) 175.
26 On the need to limit the concept of ‘embedding’ to non-market institutions, see
Alexander Ebner, ‘Transnational Markets and the Polanyi Problem’, in Christian Joerges
and Josef Falke (eds.), Karl Polanyi, Globalization and the Potential of Law in Transnational
Markets (Oxford, Hart, 2011) 19. See also the ‘Polanyi in Brussels’ debate in James Caporaso
and Sidney Tarrow, ‘Polanyi in Brussels: Supranational Institutions and the Transnational
Embedding of Markets’ 63 International Organization (2009) 593, and Martin Höpner and
Martin Schäfer, ‘Embeddedness and Regional Integration: Waiting for Polanyi in a Hayekian
Setting’ 66 International Organization (2012).
27 As Streeck puts it, ‘capitalism cannot exist outside of non-capitalist modes of social
organization even though it continuously strives to emancipate itself from them and in
fact is destructive of them.’ Wolfgang Streeck, ‘Taking Capitalism Seriously: Towards an
Institutionalist Approach to Contemporary Political Economy’ 9 Socio-Economic Review
(2011) 137, at 162.
28 This is the point Greta Krippner insists on making. See e.g. Greta Krippner,
‘The Elusive Market: Embeddedness and the Paradigm of Economic Sociology’ 30
Theory and Society (2001) 774, and Greta Krippner and Anthony Alvarez, ‘Embeddedness
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a legal approach to private regulation195
‘the market’ in that neoclassical sense is by no means as omnipotent
as we tend to think. How do actors attach value to a product in relation
to others? How do actors solve ‘the problem’ of that eternal contradiction
of economics and capitalism—that if markets were perfect, no one
would make a profit? How do actors deal with information asymme­
tries and opportunism?29 Part of the answer, in adhering to the topic
at hand, lies in standards. The larger point is, to use Fred Block’s (in)
famous phrase, that markets are always and everywhere embedded,30
embedded in civil society, seen as “a concrete set of social relationships,
cultural understandings, and institutional and organizational forms that
shape the possibilities for economic action.”31 The market is a social
institution.
Thinking about markets this way should unsettle the way we think
about economic regulation. It dissolves stark distinctions between the
‘free market’ and political interventionism, between (public) law that corrects markets and (private) law that facilitates exchange. And it helps us
understand that there is no such thing as an ‘unregulated market.’ If markets are always already embedded, political intervention into markets is
not a question of filling a void, but of interaction with the wider normative
universe that constitutes markets.32 The ‘embedded market’ may also help
simply to shift focus. Instead of concentrating on ways to incorporate and
discipline ‘the market’ into a pre-defined political community and its law,
it could be worthwhile to realize that ‘the market’ is, of functional necessity, a norm-generating social institution that should itself be turned into
a political community.
and the Intellectual Projects of Economic Sociology’ 33 Annual Review of Sociology (2007)
219.
29 Jens Beckert, ‘The Great Transformation of Embeddedness: Karl Polanyi and the New
Economic Sociology’ in Chris Hann (ed.), Market and Society- The Great Transformation
Today (Oxford University Press, 2009) 38.
30 Fred Block, ‘Understanding the Divergent Trajectories of the United States and
Western Europe: A Neo-Polanyian Analysis’ 35 Politics & Society (2007) 3, at 5. For his effort
to trace the ‘always already embedded market’ to Polanyi himself, see Fred Block, ‘Karl
Polanyi and the Writing of The Great Transformation’ Theory and Society (2003) 1, at 24
(explaining how Polanyi discovered the concept of the ‘always embedded economy’ but
was not able to ‘name’ his discovery.)
31 Fred Block and Peter Evans, ‘The State and the Economy’, in Neil J. Smelser and
Richard Swedberg (eds.), The Handbook of Economic Sociology (Princeton, Princeton
University Press, 2nd ed., 2005) at 505.
32 For an emphasis on the dynamic interaction between business practice and law, see
Gregory Shaffer, ‘How Business Shapes Law: A Socio-Legal Framework’ 42 Connecticut Law
Review (2009) 147.
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3. The Function of Law in the Global Economy
Regulatory law “must remain linked to legislative programs in a transparent, comprehensible, and controllable way,”33 dixit Habermas. That, of
course, is a non-starter for transnational governance regimes.34 It could
even be argued that it has been a non-starter in domestic settings for quite
some time now. The ‘transmission belt’ theory of US administrative law,
for example, was effectively demolished by a pre-global Richard Stewart
back in 1975. Administrative law, he demonstrated, is hardly about constraining the exercise of regulatory power within the bounds set by the
will of the people, but rather about the “provision of a surrogate political
process to ensure the fair representation of a wide range of affected interests in the process of administrative decision.”35 Outside of the hierarchical frame of law and state, it seems reasonable to ask why this ‘surrogate
political process’ could not, in principle, be orchestrated in private bodies
as well as public bodies. With Alfred Aman, there may be something to be
said for a ‘new’ administrative law that seeks “to help create a meaningful
politics around the decisions of private actors.”36
Habermas will have nothing of it, however. In his enthusiasm for the
parliamentary complex, he relegates private governance regimes to the
“impulse-generating periphery,”37 and dismisses the idea of the “inner
constitutionalization” of corporative actors as “vitiating the idea of govern­
ment by law.”38 The suggestion here is that we reverse our thinking.
33 Jürgen Habermas, Between Facts and Norms (Boston, MIT Press, 1995) at 441. In fairness, he readily admits that “there is no patented recipe for this.”
34 See e.g. Jean Cohen and Charles Sabel, ‘Global Democracy?’ 37 New York University
Journal of International Law and Politics (2005) 763, at 765 (Principal-agent models that
deeply shape our ideas about legitimate and effective delegation of authority are ‘irrelevant’ in global administrative space.). See also Julia Black, ‘Constructing and contesting
legitimacy and accountability in polycentric regulatory regimes’ 2 Regulation & Governance
(2008) 137.
35 Richard Stewart, ‘The Reformation of American Administrative Law’ 88 Harvard Law
Review (1975) 1669, at 1670.
36 Alfred Aman, ‘Globalization, Democracy, and the Need for a New Administrative
Law’ 49 UCLA Law Review (2002) 1687, at 1693. See also Jody Freeman, ‘Private Parties,
Public Functions and the New Administrative Law’ 52 Administrative Law Review
(2000) 813.
37 Jürgen Habermas, supra note 33, at 442.
38 Ibid., at 351. Paradoxically, David Sciulli’s influential Theory of Societal Consti­
tutionalism (Cambridge University Press, 1994) is grounded largely on (early) Habermassian
theory. See especially the groundwork in David Sciulli, ‘Foundations of Societal Constitu­
tionalism: Principles from the Concepts of Communicative Action and Procedural Legality’
39 British Journal of Sociology (1988) 377.
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What if we perceive formal legal systems as the ‘impulse-generating
periphery’ to global private governance regimes, and the idea of government by law is found to be expressed exactly in law’s capacity to ‘constitutionalize’ private transnational rulemaking?39
Standards enable coordination of economic activity. To be able to
perform that function, however, standards need to be woven into other
institutions and recognized by public authorities and legal systems in a
multitude of ways and settings.40 Standards are adopted, incorporated or
referred to by private and public agencies at various levels of governance;
they end up in transnational supplier contracts and in local public works
contracts; and they feature in unilateral codes of conduct and in multilateral treaties. They determine who gets insurance at which terms, what can
be sold under what name, and what can be manufactured at what cost.
Recognition comes with contestation. Like it or not, courts and regulators
will have to ask questions of these norms. Do they reflect industry custom,
‘the state of the art’, ‘acknowledged rules of technology,’ ‘reasonable consumer expectations’, and other hinge clauses? Do they encourage or stifle
innovation and competition? Are they ‘objective’ and non-discriminatory?
The answers to these questions will almost invariably turn on the procedure through which the standards at issue were set or adopted. And so
European public procurement law may well generate ‘impulses’ for the
Forest Stewardship Council, and a product liability case in Mississippi, or
a competition case in Australia may well induce the ISO to sharpen its
internal regulations.41
It could be argued, of course, that this decentralized system of recog­
nition and contestation merely separates ‘good’ standards from bad
standards, and that its collective normative pull leads perhaps to better
standard-setting procedures and, at most, buys some ‘legitimacy’ or
‘accountability.’ The distinction between ‘good’ standards and bad does
not obviously have very much to do with the distinction between law and
non-law. And yet.
39 See e.g. Gunther Teubner, ‘The Two faces of Janus: Rethinking Legal Pluralism’ 13
Cardozo Law Review (1996) 901.
40 See e.g. Tim Bartley, ‘Transnational Governance as the Layering of Rules: Inter­
sections of Public and Private Standards’ 12 Theoretical Inquiries in Law (2011) 517, and
Gregory Shaffer, ‘Transnational Legal Process and State Change’ 37 Law & Social Inquiry
(2012) 229.
41 See generally Harm Schepel, The Constitution of Private Governance (Oxford, Hart,
2005).
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4. Law is What the Law Says Law Is
With a bewildering array of interacting normative orders in transnational
fields, scholars have found good reason to (re-)ask some fundamental
questions about the nature of law. And it seems we are all legal pluralists
now—not just socio-legal scholars and legal theorists confronting the
transnational,42 but international lawyers confronting a lack of unity and
hierarchy43 and private international lawyers coming out of their ‘closets.’44 Law as social practice, of course, springs from many sources, and it
is perhaps in the subversive nature of the legal pluralist to dismiss the
juristic idea of the unity of law and state as mere ideology that makes very
little sociological sense.45 It is in this vein that Paul Berman can dismiss
“the whole debate about law versus non-law” as “largely irrelevant”.46 But
if everything is law, nothing is. The risk is that we strip the concept of
law of all normative aspiration and, indeed, “cease to make demands on
the world.”47 The task, then, is to ‘find’ a concept of law wide enough to
accommodate norms stemming from beyond recognized state-based
42 See e.g. Roger Cotterrell, ‘Transnational Communities and the Concept of Law’ 21
Ratio Juris (2008) 1; Brian Tamanaha, ‘Understanding Legal Pluralism: Past to Present, Local
to Global’ 30 Sydney Law Review (2008) 375; Klaus Günther, ‘Legal pluralism or uniform
concept of law? Globalisation as a problem of legal theory’ 5 No Foundations (2008) 5; Ralf
Michaels, ‘Global Legal Pluralism’ 5 Annual Review of Law and Social Science (2009) 243;
Peer Zumbansen, ‘Transnational Legal Pluralism’ 1 Transnational Legal Theory (2010) 141,
and Paul Schiff Berman, Global Legal Pluralism (Cambridge, Cambridge University Press,
2012). But see Simon Roberts, ‘After Government? On Representing Law Without the State’
68 Modern Law Review (2005) 1.
43 See Neil Walker, ‘Beyond Boundary Disputes and Basic Grids: Mapping the Global
Disorder of Normative Orders’ 6 International Journal of Constitutional Law (2008) 373; and
Nico Krisch, Beyond Constitutionalism: the Pluralist Structure of Postnational Law (Oxford,
Oxford University Press, 2011). ‘Constitutionalism’ versus ‘pluralism’ is now such a structuring device in debates that scholars from very different schools of thought have to navigate
their way through it. Compare Alec Stone Sweet, ‘Constitutionalism, Legal Pluralism, and
International Regimes’ 16 Indiana Journal of Global Legal Studies (2009) 621, and Ruth
Buchanan, ‘Reconceptualizing Law and Politics in the Transnational: Constitutional and
Legal Pluralist Approaches’ 5 Socio-Legal Review (2009) 21.
44 Horatia Muir Watt, ‘Private International Law beyond the Schism’ 2 Transnational
Legal Theory (2011) 347. See further e.g. Michaels, supra note 6, at 1209; and Robert Wai,
‘The Interlegality of Transnational Private (2008) 71 Law & Contemporary Problems
(2008) 106.
45 See Roger Cotterrell, Law’s Community (Oxford, Clarendon, 1995) 306 (attributing to
legal pluralism “intellectualised nostalgia for the neighborhood norms and customs of the
pre-modern world planned out of existence by the lawmaking activities of the state.”)
46 Paul Schiff Berman, ‘The New Legal Pluralism’ 5 Annual Review of Law and Social
Science (2009) 225, at 237.
47 Koskenniemi, supra note 10.
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sources while maintaining the analytical and normative purchase of the
category.
Part of this effort is a search for attributes that depend neither on the
King’s Head or his Bodies.48 A lot of wonderful work has been done to
achieve this, much of it drawing on Lon Fuller’s principles of procedural
legality.49 Benedict Kingsbury draws on Jeremy Waldron’s notion of ‘publicness’, by which is meant “the claim for law that it has been wrought by
the whole of society, by the public, and the connected claim that law
addresses matters of concern to the society as such.”50 Publicness is immanent in law, so that the assertion of ‘lawness’ carries with it the burden: in
choosing to claim to be law, or in pursuing law-like practices dependent
on law-like reasoning and attractions, or in being evaluated as a law-like
normative order by other actors determining what weight to give to the
norms and decisions of a particular global governance entity, a particular
global governance entity or regime embraces or is assessed by reference to
the attributes, constraints and normative commitments that are immanent in public law.51
But ‘publicness’ is also constitutive of law and is woven into the very
concept of law. Kingsbury does this by adding a stipulation in the ‘rule of
recognition’ that only rules and institutions meeting the requirements of
publicness immanent in public law can be regarded as law.52 In establishing the law/non-law distinction as immanent to law, Kingsbury moves
somewhat closer to Gunther Teubner’s work than he would seem to be
comfortable with.53
48 Gunther Teubner, ‘The King’s Many Bodies: The Self-Deconstruction of Law’s
Hierarchy’ 31 Law and Society Review (1997) 763, and Matthias Goldmann, ‘We Need to Cut
Off the Head of the King: Past, Present and Future Approaches to International Soft Law’
25 Leiden Journal of International Law (2012) 335.
49 See e.g. Jan Klabbers, ‘Law-making and Constitutionalism’ in Jan Klabbers, Anne
Peters and Geir Ulfstein, The Constitutionalization of International Law (Oxford, Oxford
University Press, 2009) 81; and Jutta Brunnée and Stephen Toope, Legitimacy and Legality
in International Law (Cambridge, Cambridge University Press, 2010). David Sciulli’s work,
supra note 38, is based on both Habermas and Fuller.
50 Benedict Kingsbury, ‘The Concept of “Law” in Global Administrative Law’ 20
European Journal of International Law (2009) 23, at 31. The reference is to Jeremy Waldron,
‘Can There Be A Democratic Jurisprudence?’ 58 Emory Law Journal (2009) 675.
51 Kingsbury, supra note 50, at 30. See also Armin von Bogdandy, Philipp Dann and
Matthias Goldmann, ‘Developing the Publicness of Public International Law: Towards a
Legal Framework for Global Governance Activities’ 9 German Law Journal (2008) 1375,
at 1384.
52 Kingsbury, supra note 50, at 30.
53 Kingsbury discusses and ultimately dismisses Teubner’s work as normatively unattractive. Kingsbury, supra note 50, at 52 et seq.
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There is, to be sure, a fair amount of circularity at work where authority
is a function of validity as much as validity is a function of authority. But
that is, in a way, the constructivist point. The law recognizes norms as law
if they are law. That recognition is a legal operation, carried out, not on the
basis of a checklist of external criteria,54 but on the basis of criteria that
are immanent in and constitutive of law. Every act of recognition is, hence,
always also an act of constituting law and legal institutions.
5. Constitutive Paradoxes
The distinctions the law makes—between public and private, market
ordering and market correcting—may be false but should still be sustained, so Callies and Zumbansen, as ‘constitutive paradoxes’ of a legal
order.55 On that note, we can re-read some paradigmatic case law of private regulation.
Allied Tube,56 a US Supreme Court case, put the fear of God into the
standardization community through the specter of treble damages. Here,
a company was accused of ‘packing’ the General Assembly of the National
Fire Protection Association (NFPA), a private body, in a successful effort to
exclude a competitor’s product from the Association’s flagship standard,
the National Electrical Code (NEC). Since the NEC was (and is) adopted by
virtually every State in the country as the law of the land, the NFPA argued
for governmental immunity from antitrust liability on the theory that
the political process should be left alone to determine ‘the public interest,’
this so-called Parker immunity protects public legislation, no matter
how anti-competitive.57 The Court declined on a formal public/private
distinction:
The Association cannot be treated as a ‘quasi-legislative’ body simply
because legislatures routinely adopt the Code the Association publishes.
Whatever de facto authority the Association enjoys, no official authority has
been conferred on it by any government.
That leaves the Association with the task of justifying the standard on the
grounds that it is conducive to competition and not an ‘unreasonable
54 But see Jacco Bomhoff and Anne Meuwese, ‘The Meta-Regulation of Transnational
Private Regulation’ 38 Journal of Law and Society (2011) 138 (discussing ‘Better Regulation’
principles as meta-regulation).
55 Gralf-Peter Callies and Peer Zumbansen, supra note 6, at 255.
56 Allied Tube v Indian Head 486 US 492 (1988).
57 Parker v Brown 317 US 341 (1943).
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a legal approach to private regulation201
restraint of trade.’ That distinction subsequently gets dissolved by a procedural requirement of the standard-setting process:
When private associations promulgate safety standards based on the merits
of its objective expert judgments and through procedures that prevent the
standard-setting process from being biased by members with economic
interests in stifling product competition, those private standards can have
significant pro-competitive advantages.
As the Court admits, “the issue of immunity in this case collapses into the
issue of liability.” Immunity, granted without ado to any formally ‘public’
regulator, has to be earned through procedural guarantees of publicregardingness.58
Snyder, a 1996 New Jersey Supreme Court case, topped a string of cases
holding standards bodies liable in tort, sending at least one straight
into bankruptcy.59 The case had to deal with a death caused by an HIVcontaminated blood transfusion. Fingers were pointed at the American
Association of Blood Banks, the trade association of the blood banking
industry, for failing to recommend surrogate testing in timely manner.
The Court established a duty of care through the doctrine of the Good
Samaritan:
Society has not thrust on the AABB its responsibility for the safety of the
blood and blood products. The AABB has sought and cultivated that responsibility. For years, it has dominated the establishment of standards for the
blood-banking industry. (…) On behalf of itself and its member banks, the
AABB lobbies legislatures, participates in administrative proceedings, and
works with governmental health agencies in setting blood-banking policy. In
many respects, the AABB wrote the rules and set the standards for voluntary
blood banks.
For its claims and efforts to be law, the Association will have to bear the
consequences. The AABB, of course, immediately tried to turn the Court’s
observation to its benefit. Exactly because it played such a major role in
public policy, it could not be held to owe a duty of care to private parties
on the same rationale that underpins the immunity that benefits government agencies. The Court would have nothing of it, for familiar reasons:
Unlike government agencies, the AABB is not created by statute. It does not
act pursuant to a government mandate. Nor is it accountable either to the
public or to another branch of government.
58 The term is coined in Jerry Mashaw, ‘Constitutional Deregulation: Notes toward a
Public, Public Law’ 54 Tulane Law Review (1980) 849.
59 Snyder v AABB 676 A 2d 1946 (NJ 1996).
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And so the issue of immunity, once again, collapses into the issue of liability: the content of the Association’s private law duty of care towards citizens affected by its rulemaking practices is defined by the public law
requirements inherent in the very concept of law.
6. By Way of Conclusion
Where these cases, in a hopeful reading, could be taken to exemplify a
jurisgenerative approach to private rulemaking, the WTO Appellate Body
in the case of Sardines was surely guilty of pure jurispathos. The WTO
Agreement on Technical Barriers to Trade requires States to ‘base’ their
technical regulations on ‘international standards’, and provides a safe
haven for technical regulations that are ‘in accordance’ with such standards.60 In Sardines, the Appellate Body was asked to read a procedural
requirement of ‘consensus’ into the definition of ‘international standard.’
Not finding anything much in the text of the Treaty to support such an
interpretation, the Appellate Body declined. It hastened to add that:
the fact that we find that the TBT Agreement does not require approval by
consensus for standards adopted by the international standardization community should not be interpreted to mean that we believe that an international standardization body should not require consensus for the adoption
of standards. That is not for us to decide.61
But it is.
60 Article 2(4) and (5) TBT Agreement.
61 EC- Sardines, WT/DS 231/AB/R, 26 September 2002, para. 227.
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