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Globalisation: the legal dimension


Globalisation: the legal dimension



The end of the Cold War has loosened many of the blockages to international lawmaking and implementation. Although legal scholars still ask what states can do on their own - pass extraterritorial laws, use force, or prosecute war criminals - they do so assuming that coordinated action is now more feasible than in the past. Global and regional treaties such as the Chemical Weapons Convention, the Convention on the Prohibition of Anti-Personnel Mines and the increasing number of Free Trade Regional Agreements now serve as the starting point for scrutinizing state behaviour according to some objective standard.

The ground seems ready then for an acceleration of this century's great trend in international law. This new global context constantly pose challenges to international law. This constant challenge can only be understood if one keeps in mind that globalisation is not simple and linear development, but rather complex and contradictory process. The emergence of several overlapping and competing normative orders – characterized in terms of ‘new medievalism’ and ‘legal pluralism’ - has given impetus to some age-old debates in international law: What is the role of the ‘international community’? What is the proper function and meaning of state sovereignty in international law? What are the powers of international organizations in relation to the overlapping legal orders of their member states? At a more practical level, the problem of ‘legal pluralism’ is discussed in the context of the proliferation of international tribunals: how does this affects the unity and coherence of international law and what should be the proper role of lawyers in dealing with competing norms and competences?


Globalisation and the international system, New Forms, New Players

Traditionally, most rules of international law could be found in one of two places: treaties - binding, written agreements between states; or customary law - uncodified, but equally binding rules based on longstanding behaviour that states accept as compulsory. The strategic arms reduction treaties requiring the United States and Russia to cut their nuclear weapons arsenals offer examples of the former; the rule that governments cannot be sued in the courts of another state for most of their public acts provides an example of the latter. Historically, treaties have gradually displaced much customary law, as international rules have become increasingly codified.

But as new domains from the environment to the Internet come to be seen as appropriate for international regulation, states are sometimes reluctant to embrace any sort of binding rule. In the past, many legal scholars and international courts simply accepted the notion that no law governed a particular subject until a new treaty was concluded or states signalled their consent to a new customary-law rule (witness the reluctance with which human rights norms were considered law prior to the UN's two key treaties in 1966) or, alternatively, struggled to find customary law where none existed. However, today all but the most doctrinaire of scholars see a role for so-called soft law - precepts emanating from international bodies that conform in some sense to expectations of required behaviour but that are not binding on states.

Globalization represents a more fundamental change, a qualitative transformation of the international system with lasting implications for the public and private sectors alike, including changes in the nature of the legal processes and structures that shape the relationships and interactions among states.

Traditional forms of international law-making through treaties and custom (hard law), the principal instruments formalizing inter-state cooperation, are less appropriate to shape the relationships of the various actors that are an integral part of globalization, reflecting the changing roles in the emerging global system of states, the private sector, and civil society organizations such as NGOs. Indeed, scholars of international law and international relations recently have expressed doubt about the continued utility of traditional methods of international law-making in the new global environment[i]. Building on these criticisms and on the conceptual distinction between interdependence and globalization, this chapter sets forth a conceptual framework for the growing importance of non-binding international legal instruments (NBILAs) or so-called “soft”[ii] law. Following Koh’s concept of the “transnational legal process”[iii], we understand soft law and its participating non-state actors as critical catalysts for and constituent elements of successful transnational cooperation and the creation of international norms that are crucial for a further development of a true international/ transnational society[iv]. Thus, NBILAs are not necessarily an alternative to international hard law or inter-state cooperation, but they can and often do represent the first important element in an evolutionary process that shapes legal relationships among and between multiple public and private actors, facilitating and ultimately enhancing the effectiveness and efficiency of transnational policy-making.


New Enforcement Strategies

Most states comply with much, even most, international law almost continually - whether the law of the sea, diplomatic immunity, or civil aviation rules. But without mechanisms to bring transgressors into line, international law will be "law" in name only. This state of affairs, when it occurs, is ignored by too many lawyers, who delight in large bodies of rules but often discount patterns of noncompliance. For example, Western governments, and many scholars, insisted throughout the 1960s and 1970s that when nationalizing foreign property, developing states were legally bound to compensate former owners for the full economic value, despite those states' repeated refusals to pay such huge sums.

The traditional toolbox to secure compliance with the law of nations consists of negotiations, mediation, countermeasures (reciprocal action against the violator) or, in rare cases, recourse to supranational judicial bodies such as the International Court of Justice. (The last of these was the linchpin of the world of law that Americans such as Andrew Carnegie and Elihu Root sought to bring into being.) For many years, these tools have been supplemented by the work of international institutions, whose reports and resolutions often help "mobilize shame" against violators. But today, states, NGOs, and private entities, aided by their lawyers, have striven for sanctions with more teeth. They have galvanized the UN Security Council to issue economic sanctions against Iraq, Haiti, Libya, Serbia, Sudan, and other nations refusing to comply with UN resolutions.

On the free-trade front, the dispute settlement panels in the World Trade Organization (WTO) now have the legal authority to issue binding rulings that allow the victor in a trade dispute to impose special tariffs on the loser. In September 1997, for example, the WTO's Dispute Settlement Body recommended that the European Union modify its banana import regime following complaints by Ecuador, Guatemala, Honduras, Mexico, and the United States, paving the way for those states to suspend free made if the EU fails to comply. And the UN's ad hoc criminal tribunals for the former Yugoslavia and Rwanda show that it is at least possible to devise institutions to punish individuals for human rights atrocities.

Nonetheless, as the impunity to date of former Bosnian Serb president Radovan Karadzic and General Ratko Mladic reveals, the success of these enforcement mechanisms depends on the willingness of states to support them: legalism meets realism. When global institutions do not work, regional bodies may offer more promise due to their "club" atmosphere. Organizations such as the EU and the Organization of American States have demonstrated their influence over member conduct in economics, human rights, and other areas.

Increasingly, domestic courts provide an additional venue to enforce international law. In Spain, for example, Judge Manuel Garcia Castellon of the National Court has agreed to hear a controversial human rights case involving charges against Chile's former dictator, General Augusto Pinochet. Meanwhile, Castellon's colleague, Judge Baltasar Garzon, hears testimony against those responsible for the "Dirty War" of the 1970s in Argentina. (Spain is asserting jurisdiction in both cases because its nationals were among the thousands of victims tortured and killed.) And though Karadzic remains at large, he has been sued in U.S. federal court under the Alien Tort Claims Act, which allows foreign nationals recovery against Karadzic for the rape and torture of civilians during his "ethnic cleansing" campaign in the former Yugoslavia. At a minimum, this provides a symbolic measure of solace for his victims.


Traditional International Cooperation and International Law

If governments want to shape globalization rather than merely react to it, they must operationalize internal sovereignty in a non-territorial context. Forming a global government is one response, but it is unrealistic because it would require states to abdicate their sovereignty in a formal sense. It is also undesirable for reasons of accountability and legitimacy: there presently exists no “transnational public space” where political discourse -one important pillar of a global civil society – could be organized, including mechanisms of public control over international policy-making.38 Finally, while global government may be a technocrat’s answer to the shortcomings of territorially-based approaches to public policy, it could not match the dynamism of transnational economic and social networks, legal and illegal alike, that have emerged with globalization; nor is there any reason to believe that a global government is better equipped to manage the technical complexities and speed of evolution of public policy at the beginning of the twenty-first century.

Thus for many observers a more adequate answer is to continue strengthening the structure of multilateralism, development of which is seen in the rising number of international institutions and organizations[v]. In this context, the present significance of international law is without doubt one of the preeminent achievements of the post-war international system[vi]. These forms of inter-state cooperation have their roots and robustness in the management of external sovereignty, i.e. the management of interdependence. International hard law instruments have been the most important element in the cooperative processes[vii]. State action has largely precipitated and structured the processes and the instruments, notwithstanding the growing importance of non-state actors and international organizations in inter-state negotiations and lawmaking.

The importance of international hard law can be seen not only in the number of international treaties and agreements, but also in the increasing impact of international law on peoples’ lives[viii]. There nonetheless continue to be major obstacles in the way of establishing a system of international law comparable to the legal systems of nation-states, in which all “courts, agencies,  and other formal organs of dispute settlement or rule application are all more or less coordinated in an integrated and hierarchical legal system . . .”[ix]. In fact, it seems that the development of international law represents merely a patchwork. The uncoordinated division of labor among existing international institutions and organizations reflects this dilemma and uncovers the extensively-discussed gaps and loopholes in the system of international law and multilateralism[x].  The advent of globalization has revived the agenda the issue of developing a system of global governance that is efficient, effective and legitimate when compared to that of modern nation-states. If one accepts the notion of the diminishing importance and significance of nation states, it becomes important to conceive of a system that acts as the principal institutional mechanism though which internal sovereignty can be applied and enforced at the global level.

Some have proposed the emergence of a ‘cosmopolitan democracy’, an encompassing system of international law that includes individuals and groups, with fundamental individual rights guaranteed by supranational judicial authorities above the national legal framework[xi]. This perspective, appealing as it is, appears overly broad and optimistic, given the historical evolution of the international system and international law. It also would take time to develop such an order[xii]. More specifically, a number of theoretical and operational concerns throw considerable doubt on the ability of the traditional system to respond adequately to the growing demand for cooperation compelled by globalization and to the changing characteristics and complex nature of managing internal sovereignty in a transnational context.

First, the inter-governmental instruments, regimes and organizations that were used to   promote economic interdependence (external sovereignty as global policy issues) may not be appropriate to manage globalization (internal sovereignty as global policy issues). The issues for which cooperation is sought are likely to be more complex and highly contentious, embedded as they are in history and culture. Thus, in contrast to the management of interdependence, which promoted a widely accepted paradigm of free trade and reciprocal reduction of tariff barriers, globalization challenges policy makers to develop common standards on issues such as non-tariff barriers, heretofore the exclusive prerogative of nation states[xiii], in the face of national perceptions of the public good.

Second and related, the management of interdependence and expansion of the international legal system was largely structured by functionally equivalent nation-states, while globalization has been driven primarily by non-state, especially corporate actors. Given this development, the management of internal sovereignty in a non-territorial context is likely to  require considerable interaction among functional opposites (nation-states and private actors) at the global level and may necessitate a reconsideration of conventional models of cooperation in light of the different modes and cultures of organization and communication that characterize the public and private sectors.

Third, recent scholarship has argued convincingly, contrary to the assumptions of (Neo-) Realism and (Neo-) Liberalism, that states’ interests as well as their identities are not static and exogenously created[xiv] but are “socially constructed products of learning, knowledge, cultural practices, and ideology”[xv] shaped over a long period of time. This work acknowledges, in principle, the possibility of change in states’ interests and identities, but also recognizes the obstacles, noting that “notwithstanding the growing importance of non-state actors in world politics, states remain jealous of their sovereignty and so may resist collective identification more than other actors”[xvi]. It thus is not readily apparent that existing state-dominated structures and institutions of cooperation, including the formulation of treaties and custom, can easily respond to let alone ‘absorb’ the set of issues involved in managing internal sovereignty in a manner that would resemble socially constructed outcomes.

The emergence of internal sovereignty as a global policy issue exposes existing shortcomings in negotiating, implementing, and monitoring international hard law[xvii]. First, legal and international relations scholars widely agree that hard law-making usually entails a slow and costly process, involving exhaustive negotiation processes between top-levels of national bureaucracies. These processes are not effective and flexible enough to accommodate the public policy demands emanating from highly adaptive and responsive global corporate networks, which require a constant reassessment of the structures that govern them[xviii].

Second, international treaties are based on consensus of the negotiators. Their content thus tends to reflect a narrow and often lowest common denominator not necessarily responsive to complex and interdisciplinary global challenges like environmental protection and labor market regulation. Moreover, most treaties classify states as either member and non-member. Such rigidity does not favor regime development, let alone success, because it excludes a priori those that are financially or technically unable to comply and those who disagree with the fundamental treaty obligations.

Third, the effectiveness of international cooperation through treaties is usually delayed because of the requirement of parliamentary ratification [xix], although states have adopted ameliorative techniques such as provisional treaty application and delegated law-making (to supranational regulatory authorities or agencies). While helpful, these techniques cannot cure the underlying problem and in some cases have created new ones. First, provisional application does not resolve the need for a ‘fast-track’-device to manage a continuously changing policy landscape. Second, delegated law-making empowers institutions that lack the legitimacy and accountability of their national counterparts, results in a democratic deficit, and fosters the growing political resistance to globalisation.

Fourth, globalisation fundamentally alters the prospects and possibilities of compliance, potentially leading to a higher incidence of defection from international agreements. In many cases it is no longer sufficient to ask whether states are willing, but if they are able to comply. In some issue-areas nation-states cannot fulfil treaty obligations because the objects of regulation are highly mobile and act on a transnational scale. According to Chayes and Chayes, “the problem [of involuntary defection] is even more acute in contemporary regulatory treaties. Such treaties are formally among states, and the obligations are cast as state obligations. . . . The real object of the treaty, however, is not to affect state behaviour, but to regulate the activities of individuals and private entities . . . .”[xx] Lack of capacity is not limited to developing countries; in some issue areas, e.g. banking regulation, money laundering, dual-use trade, and terrorism, it affects members of the industrialized OECD-world. Although Louis Henkin argues from established empirical facts that “almost all nations observe almost all principles of international law and almost all of their obligations almost all of the time,” [xxi] this assertion may well be disproved by the advent of globalisation and the challenges it creates, creating a new source of conflict between nations. In sum, traditional international law and interstate cooperation associated with the management of interdependence are unlikely to be effective, efficient, or legitimate instruments to respond to the public policy challenges of globalisation, although improvements have been made in hard law-making.

Global environmental treaties often now include selective incentives, differential obligations or are regionalized to become more open and flexible [xxii],  although there may be good reason to reject a regionalized approach [xxiii]. More importantly, it is doubtful whether these and other adjustments will be able to establish the degree of inclusiveness, support and legitimacy that is required for the sustained and successful management of internal sovereignty. Hard law often does not offer the required ‘process openness’ many global policy issues need to achieve acceptance and compliance by all participants. Instead, successful global governance of internal sovereignty beyond the nation-state must transcend the governments and politics of nation-states to take on a much wider meaning in terms of participating actors and levels and structures of interaction [xxiv]. Traditional international hard law and inter-state cooperation must be complemented by a more incremental and evolutionary approach that acknowledges and incorporates the qualitative differences between interdependence and globalisation,.

Legal scholars sometimes distinguish the ‘international law of coexistence’ and the ‘international law of cooperation’ [ xxv]. As a pillar of interdependence, the ‘international law of cooperation’ is understood as the “development of an international law expressing the need for states to cooperate in order to attain objectives beneficial to all.”61 Under conditions of globalisation, the ‘international law of cooperation’ has gained in importance, but it can succeed only if international law can move beyond its narrow focus on states. It must adopt and employ broad and flexible legal structures and processes that facilitate the social construction of states’ interests in order for them to establish and exercise internal sovereignty at the global level. As is shown in the following discussion, NBILAs make an important contribution to the emergence of such structures and processes.


Transnational Legal Process and Global Public Policy

Non-state actors play a transformative role that changes the interests, identities and thus incentives of state actors such that they are willing to enter more binding legal obligations. As Wendt has shown, “when states interact, much more is going on than [IR schools such as] realism and rationalism admit”[xxvi]. Harold Koh, along with Wendt and other constructivist IR scholars, argues that state behaviour is conditioned not merely by rational self-interest, determined by the nature of the international system itself or narrow even nationalist domestic interests [xxvii].

Rather an explanation of why nations obey international law “must . . . account for the importance of interaction within the transnational legal process, interpretation of international norms, and domestic internalisation of those norms as determinants” [xxviii] Koh characterizes the transnational legal process theory as “the theory and practice of how public and private actors including nation-states, international organizations, multinational enterprises, non-governmental organizations, and private individuals, interact in a variety of public and private, domestic and international fora to make, interpret, internalise, and enforce rules of transnational law.”[xxix]


Accordingly, international law-making and the observance of law itself is a constructivist social activity, with feedback effects modifying domestic law, reshaping domestic bureaucracies, and changing the attitudes of domestic decision-makers, all of which influence the interests and identities of nation-states [xxx]. Linking horizontal subsidiarity and NBILAs appears to have all the major advantages and characteristics needed to initiate and sustain such a transnational legal process on a sustained basis. It is non-traditional (there is no barrier between domestic and international, public and private international law), non-statist (not only nation-states are actors), dynamic (in terms of its evolution through different domains), and normative (law shapes and guides future interactions) [xxxi].

In addition, by integrating private actors, inter-societal links are established that over the long-run can ease the complex negotiation processes where different cultural norms and values are involved and overcome national bureaucratic resistance and inertia that are likely to play an important when internal sovereignty needs to established a non-territorial context [xxxii]. Global public policy also can have a normative character as it leads to new interpretations of existing rules and their internalisation back into domestic law to shape future interactions between states and private actors. Going one step beyond Koh, transnational legal processes in the context of global public policy not only influence ‘why nations obey’ but also challenge private actors to do the same.

[i] See Abram Chayes and Antonia Handler Chayes, The New Sovereignty: Compliance with International Regulatory Agreements (1995); Steven R. Ratner, International Law: The Trials of Global Norms, (1998) Foreign Policy, 65-80; Edith Brown Weiss, The New International Legal System, in Perspectives on International Law 63-82 (Nandasiri Jasentuliyana, (ed.))(1993); Michael Reisman, Designing and Managing the Future of the State, (1993) 8 Eur. J. Int’l L. 410-420; Peter M. Haas et al., Institutions for the Earth: Sources of Effective International Environmental Protection (1993).

[ii] The term ‘soft’ law is controversial among international lawyers. Herein it corresponds to the framework of the project and means normative agreements that are not legally binding, in contrast to Bernhardt, who denominates them “rules, which are neither strictly binding nor completely void of any legal significance.” Rudolf Bernhardt, Customary International Law, (1984) 7 Ency. Pub. Intl. L. 61, 62. Important in this context are that NBILAs can take a wide variety of forms, and most importantly, are not subject to national ratification.

[iii] Harold Hongju, Transnational Legal Process, (1996) 75 Nebraska L. Rev. 1; Harold Hongju Koh, Why Do Nations Obey International Law? (1997) 106 Yale L. J. 2599. See also Philip C. Jessup, Transnational Law (1956).

iv] See Anne-Marie Slaughter et al., International Law and International Relations Theory: A New Generation of Interdisciplinary Scholarship, (1998) 92 Am. J. Int’l L. 367, 383.

[v] Michael Zürn, Does International Governance Meet Demand? (1997) InIIS-Arbeitspapier Nr. 4-5; Harold K. Jacobson et al, National Entanglements in International Governmental Organizations, (1986) 80 Am.Pol.Sci.Rev. 1.

[vi] Although nearly all observers agree that there is growing international cooperation, the reasons for this development remains highly debated between (Neo-) Realists and (Neo-) Liberalists, as well as proponents of critical theory such as social constructivist or reflectionist theorists. The present analysis does not go into the debate both because of the already existing vast literature on that question and, more importantly because, as it is argued below, the framework of interaction between nation-states is so rapidly and profoundly changing that much of the discussion of the 1980s and the early 1990s becomes redundant. For a good overview over the current debate about the reasons for and the possibilities of international cooperation see David A. Baldwin (ed.), Neorealism and Neoliberalism (1993).

[vii] This does not imply that states utilize only hard law instruments in cooperative processes, although treaties and custom are the preferred means. So-called international regimes could also rely on NBILAs as important instruments.

[viii] David Held, among others argues that individuals increasingly are affected by international law, in some cases appearing as subjects of international law. Held (1995) supra n. 6 at 101. As politics increasingly is uncoupled from the nation-state, the mechanisms of democratic control realized in democratic nation-states are undermined. Concerning the ongoing debate on individuals as subjects of international law, Hedley Bull noted as early as 1977 that “opinion appears to have moved decisively against the doctrine of the nineteenth-century positivists that international law (in Oppenheim’s words) is a ‘law between states only and exclusively’”, but that “[i]t is widely held that individual human beings are subjects of international law [. . .].” Hedley Bull, The Anarchical Society: A Study of Order in World Politics (1977), 145; see also Werner Levi, Law and Politics in the International Society, Sage Library of Social Research No. 32 (1976),111-115.

[ix] Mark W. Janis, An Introduction to International Law (2nd ed. 1993) 7.

[x] Zürn, supra n. 38 at 34

[xi] Held (1995), supra n. 6.

[xii] Held’s work still serves an important purpose in rethinking classical theories of democracy that were designed for modern nation-states and that have come under increasing pressure with the internationalization and globalization of politics.

[xiii] Cooperation on internal sovereignty issue areas can result in joint gains, but in general these gains will be much harder and take longer to achieve. The case of labor standards provides an example. In general, a common set of labor standards can provide a joint gain, excluding as it does the possibility of regulatory arbitrage by multinational corporations, but complex considerations of political culture and history can pose obstacles in the process of cooperation.

[xiv] Otherwise, it would be hard to explain peaceful change in the system. See Alexander Wendt, Anarchy is What States Make of It: The Social Construction of Power Politics, (1992) 46 Int’l Org. 391-425; Alexander Wendt, Collective Identity Formation and the International State, (1994) 88 Am. Pol. Sci. Rev. 384-396.; Emmanuel Adler, Seizing the Middle Ground: Constructivism in World Politics, (1997) 3 Eur. J. Int’l Rel. 319-363.

[xv] Koh (1996), supra n. 4 at 20.

[xvi] Wendt (1994), supra n. 48 at 385.

[xvii] For more extensive analysis see Peter H. Sand, International Cooperation: The Environmental Experience, in Preserving the Global Environment: The Challenge of Shared Leadership (Jessica Tuchman Mathews (ed.))(1991); Chayes and Chayes, supra n. 2.

[xviii] Technological progress is so rapid in the international financial markets and banking that regulators find it difficult to keep pace with changes and the challenges they pose to existing regulatory frameworks. See Dombrowski supra n. 14 at 8; Reinicke supra n. 17.

[xix] It usually takes the International Labor Conference two to three years to agree to a new labor standard which is then subject to national ratification before it is legally binding. Assuming states are willing to ratify the new standard, it usually takes another two to three years before it enters into force.

[xx] Chayes and Chayes, supra n. 2 at 14.

[xxi] Louis Henkin, How Nations Behave: Law and Foreign Policy (2nd ed. 1979), 47.

[xxii] Sand supra n.51 at 241-50.

[xxiii] In the case of labor standards, for example, “from the ILO´s perspective, one thing is clear. We strongly feel that: (1) there should be a body of international labor standards (or social charter) agreed on by all parties concerned; and (2) at a time when the world economy becomes ever more integrated, a regionalization of standards (i.e., different minimum standards for different regions or cultures) must be avoided at all cost.“ Heribert Maier, International Labor Standards and Economic Integration: The Perspective of the International Labor Organization, in International Labor Standards and Global Economic Integration (Gregory K. Schoepfle and Kenneth A. Swinnerton, (eds.))((1994) 11.

[xxiv] See Rosenau and Czempiel supra n. 37. There is no widely accepted definition of global governance, but the statement of the Commission on Global Governance describes global governance as “the sum of the many ways individuals and institutions, public and private, manage their common affairs. It is a continuing process through which conflict or diverse interests may be accommodated and co-operative action may be taken. It includes formal institutions and regimes empowered to enforce compliance, as well as informal arrangements that people and institutions either have agreed to or perceive to be in their interests.” Commission on Global Governance, Our Global Neighborhood (1995), 5. James N. Rosenau adopts an even broader definition: “global governance is conceived to include systems of rules at all levels of human activity – from the family to the international organization – in which the pursuit of goals through the exercise of control has transnational repercussions.“ Rosenau, supra n. 37 at 13.

[xxv] Wolfgang Friedmann, The Changing Structure of International Law (1964).

[xxvi] Wendt, supra n. 48 at 394.

[xxvii] For a constructivist view of international relations and identity and interest formation see Wendt supra n. 48 and Adler, supra n. 48.

[xxviii] Koh (1997), supra n. 4 at 2634.

[xxix] Id. at 2626.

[xxx] Note, that Koh’s characterization of a transnational legal process at least with respect to participating actors is quite similar to the notion of global governance adopted by the Commission of Global Governance: “Governance is the sum of the many ways individuals and institutions, public and private, manage their common affairs. It is a continuing process through which conflict or diverse interests may be accommodated and co-operative action may be taken. It includes formal institutions and regimes empowered to enforce compliance, as well as informal arrangements that people and institutions either have agreed to or perceive to be in their interests.” Commission on Global Governance supra n. 58 at 2.

[xxxi] Koh (1996), supra n. 4 at 2.

[xxxii] Wolfgang H. Reinicke, Deepening the Atlantic: Toward A new Transatlantic Marketplace? (1996).