Smart Library on Globalization
 
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Martin Shapiro describes the globalization of three types of law: commercial and contract law, public law and protective law. He notes that the reasons for globalization differ among these three types of law. He also notes that not all types of globalized law are “Americanized” to the same degree.
 

Why is law globalized? Why does it take the form it does when it is globalized? The answers depend on the type of law you are talking about, says legal scholar Martin Shapiro. Law is not monolithic, and neither are the processes behind it. Additionally, the extent to which the globalization of law is really the Americanization of law depends on the type of law.

In his 1993 article, "The Globalization of Law," Shapiro describes possible motivations and outcomes for different types of law: commercial and contract law, public law and protective law.

Globalization of Law: What Are We Really Talking About?

Shapiro says that when we talk about the globalization of law, two caveats apply.

First, we need to keep in view that it is likely that there are fewer people world-wide that enjoy legally defined relationships than one-hundred years ago. At any rate, it is not possible to tell definitively whether more people are now governed by the rule of law. So, we simply cannot tell whether the “globalization of law” truly has a global reach.

Second, in 1993 when Shapiro published his article, he says that to talk about the “globalization of law” effect meant to talk about the U.S., Europe, Australia and New Zealand. Globalization of law refers to a very narrow set of legal phenomena and to a limited set of countries.

Given those caveats, how can we understand the globalization of different types of law?

Globalization of Commercial and Contract Law

The globalization of commercial and contract law is largely the emergence of global law without any global lawgiver. It involves a number of interrelated phenomena:

  • It occurs in response to globalization of markets where there is pressure for relatively uniform contract and commercial law,
  • Contracts are a kind of private lawmaking. Private parties set rules to govern their relationships.
  • Contractual relationships may exist transnationally even though there are no courts to arbitrate disputes. Parties, not a global lawgiver, specify an arbitration method.
  • Parties agree on jurisdiction of dispute resolution (that is, which country’s laws will govern the dispute resolution).

When these things are the case, global law comes into being as a result of private law making. Private agreements take on a uniformity that becomes the global standard.

To What Degree Is Global Commercial and Contract Law Americanized?

Global commercial law generally takes the form of American commercial law. There are several possible reasons for this.

  • This may be, in part, because of America’s economic position in the globalization of markets,
  • It may be because there is an affinity between common law (as opposed to civil law) and contract law. That is, legal innovation is required for globalized law and common law is more amenable to innovation than civil law.
  • The change, after World War II, from vertically integrated to more horizontally integrated corporate structure, leads to an increase in the demand for legal intermediaries. The “open corporation” is essentially a deal maker. When business proceeds at a distance (that is, between companies as opposed to within companies), legal intermediaries are needed. American lawyers were already heavily involved in business transactions before the globalization of markets.
  • America already use lawyers heavily in business transactions because power is so disbursed (unlike other Western countries). Lawyers are needed where there is no social elite to negotiate and broker relationships. Shapiro says that lawyers were unwanted in the tight, interlocking corporate executive and corporate/government circles on the continent in Europe. However, in America, where there are no “gentlemen clubs,” there must be contracts, and therefore, lawyers.
  • In Europe, the practice of law—especially corporate law—had a lower status than in America. A European law degree was a more general degree while in America a legal education was focused on the practice of law.

With increased globalization of enterprise comes the demand for commercial law and the type of legal involvement that can meet the demand. According to Shapiro, it has been the American legal profession which has been particularly suited for this.

Globalization of Public Law

The globalization of public law indicates a wide-spread (among industrial countries) desire for protection from the power of government.

After World War II, faith in technocracy (that is, technocratic rule by bureaucratic specialists) faded. Recent demands call for increased transparency and greater democratic voice in bureaucratic decision-making. Law is an instrument for achieving this. For example, judges used to defer to the technocrats as the experts. Now technocrats are expected to make their knowledge understandable to judges. Law and legal oversight are used as a method for increasing bureaucratic transparency.

Additionally, globalization of public law involves not just transparency and involvement, but constitutional protection of the balance of power in the government and protection of individual rights. Constitutional judicial review involves in two constitutional limitations on government.

  1. Where boundaries are designed within the government the courts serve to maintain those boundaries,
  2. Where limitations are place on the government with respect to individual rights, courts police and protect human rights.

To What Degree Is Global Public Law Americanized?

Shapiro notes that globalization of public law appears as "Americanization" for two reasons.

First, the U.S. was ahead of other countries in increasing public participation (via interest groups) in bureaucratic decision making and in forcing bureaucratic transparency,

Second, world-wide preoccupation with written constitutions dividing government powers also often appears as Americanization. American constitutional experience appears “singularly innovative and successful” and so serves as a model.

Globalization of Protective Law

The constitutional rights movement goes beyond distrust of government to a distrust of all hierarchical authority and concentrated power. Law is an instrument for the protection of individuals from these powers (for example, consumer safety, workplace safety, security for investors and environmental law). Here, says Shapiro, we move from the realm of constitutional law to the more mundane realm of torts and such things as product safety.

The globalization of protective law can have a complex relationship to other types of law. Environmental and product safety laws can be used to counteract commercial laws.

For instance, product safety laws were used to disrupt market flows in Europe when tariffs were abolished. Countries hurt by abolishing tariffs were able to use product safety laws to limit inflows of products from other European countries, but the conflict between protective law and commercial law persisted. However, the Single Act (1992) put in place new voting rules that provided a strong incentive for harmonization of laws.

To What Degree Is Global Protective Law Americanized?

Unlike the other areas of law, protective law is much less uniform globally. Shapiro says that in this area of law, the American experience has become more of a cautionary tale than a model. America has experienced a tort explosion that other countries are not willing to emulate. Additionally, for governments that have a tax-supported healthcare and income maintenance system, protection was not as critical.

Bottom Line

Globalization of law is limited to a narrow set of legal phenomena and to a limited set of countries. Shapiro argues that the factors behind globalized law and the character of the globalized law depend heavily on the type of law and the contingencies of history. He notes that while globalized law often appears as Americanized law, this is not the case to the same degree for all types of law.

 
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Analysis of legal research.

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Reference

Shapiro, Martin. 1993. "The Globalization of Law." Indiana Journal of Global Legal Studies 1:37-64.

 
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