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Abstract

Chapter 3 is devoted to the identification of case studies or concrete examples representing alternative forms of regulation, non-state, hybrid, or private autonomous regimes. This chapter aims to provide an overview of possible forms of regulatory governance with examples taken mainly from the field of finance. Financial markets have always made extensive use of alternative and also private regulatory solutions. It distinguishes the following categories of cases: Self-regulation, a firm’s own regulation, co-regulation, coercive self-regulation, self-contained regimes, and global networks. The emergence, the underlying institutional arrangements, and the characteristics of the case studies chosen are studied. Their contest should illustrate the theoretical foundations of the previous chapter and enrich the analysis undertaken in the next one.

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Notes

  1. 1.

    On the basic issue of how regulation can be exercised, see R. Baldwin and M. Cave, Understanding Regulation – Theory, Strategy, and Practice (1999); J. Black, Critical Reflections on Regulation (January 2002) 1–2.

  2. 2.

    See: Alternatives to State Regulation, Better Regulation Task Force, July 2000, 6.

  3. 3.

    For a discussion of other models, see, for instance, M. Priest, The Privatization of Regulation: Five Models of Self-Regulation (1997–1998) 233 et seqq., 239–240; or the model of ‘enforced self-regulation’ as developed by I. Ayres and J. Braithwaite, Responsive Regulation, Transcending the Deregulation Debate (1995); J. J. Boddewyn, Advertising self-regulation: organization structures in Belgium, Canada, France and the United Kingdom (1985) 30–43; P. S. Berman, The Globalization of Jurisdiction (2002) 311–529; A. Fischer-Lescano and G. Teubner, Regime-Kollisionen, Zur Fragmentierung des globalen Rechts (2006).

  4. 4.

    S. Sassen, Territory, Authority, Rights, From Medieval to Global Assemblages (2006) 242–246 and 265–268.

  5. 5.

    J. Braithwaite and P. Drahos, Global Business Regulation (2000) 46, 53; A. Black, Guild & State, European Political Thought from the Twelfth Century to the Present (2003) 14–16, 25–26, 36–38, 55–56.

  6. 6.

    B. Straccha, De mercatura seu mercatore (1575), as cited by P. Böckli, Neun Regeln der ‘Best Practice’ für den Rückkauf nichtkotierter eigener Aktien (2001) 575–576.

  7. 7.

    Braithwaite and Drahos, supra note 5, 542.

  8. 8.

    I. Schwander, Der contrat sans loi und das nichtstaatliche Recht im Internationalen Privatrecht (2006) 117–134.

  9. 9.

    L. R. Nottage, The Procedural Lex Mercatoria: The Past, Present and Future of International Commercial Arbitration (December 2006); M. Senn, Decentralisation of Economic Law – An Oxymoron?, in: Journal of Corporate Law Studies, no 2, October 2005, 435–437; H. G. Gharavi, The proper scope of arbitration in European Community competition law (Winter 1996) 185, 185–188; C. Baudenbacher and I. Higgins, Decentralisation of EC competition law enforcement and arbitration (Winter 2002) 1, 2–3.

  10. 10.

    Sassen, supra note 4, 242–247.

  11. 11.

    http://www.iccwbo.org/home/menu_what_is_icc.asp (last visited 21 November 2009); Braithwaite and Drahos, supra note 5, 492.

  12. 12.

    Sassen, supra note 4, 245; H.-J. Mertens, Lex Mercatoria: A Self-applying System Beyond National Law? (2006) 31–35.

  13. 13.

    http://www.uncitral.org/uncitral/en/about/origin.html (last visited 21 November 2009); Sassen, supra note 4, 243–244.

  14. 14.

    Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in articles 81 and 82 of the Treaty; OJ L 1/1, 04/01/2003, 1–25.

  15. 15.

    Baudenbacher and Higgins, supra note 9, 15–17; Gharavi, supra note 9, 197–199; see also: Mertens, supra note 12, 39–40.

  16. 16.

    Sassen, supra note 4, 243–245.

  17. 17.

    In Switzerland, for instance, the law applicable to arbitration belongs to the Federal Act on Private International Law while the UK produced the UK Arbitration Act 1996.

  18. 18.

    G. Teubner, Global Bukowina: Legal Pluralism in the World Society (2006) 21, with further references; Mertens, supra note 12, 35–39. On the concept of principle, see Chapter 4 , point 2 Standardization, 2.3 Gradual Transformation, 2.3.1 From Standards to Rules.

  19. 19.

    A. Giddens, The Consequences of Modernity (1990) 70–78.

  20. 20.

    A. Redfern and M. Hunter, Law and Practice of International Commercial Arbitration (1999); C. Hopfe, The Rise of International Commercial Arbitration and the Demise of Judicial Recourse: Whatever Happened to ‘Public Policy’? (1998) 263; G. Born, International commercial arbitration in the United States: commentary and materials (1994); E. Cotran and A. Amissah, eds, Arbitration in Africa (1996); M. Pryles, Dispute Resolution in Asia, Hague (2002); J. Paulsson, International Handbook on Commercial Arbitration; A. J. van den Berg, The New York Arbitration Convention of 1958 (1994); Guide to ICC arbitration (1994); M. Rubino-Sammartano, International Arbitration Law and Practice (2001).

  21. 21.

    Credit rating agencies have been chosen as a case study, because they first represented a strong case of self-regulation. However, as will be discussed, they have been gradually absorbed into state and international regulation.

  22. 22.

    http://www.standardandpoors.com/about-sp/timeline/en/us/ (last visited 21 November 2009).

  23. 23.

    http://www.moodys.com/moodys/cust/AboutMoodys/AboutMoodys.aspx?topic=history (last visited 21 November 2009).

  24. 24.

    http://www.fitchratings.com/corporate/aboutFitch.cfm?detail=3 (last visited 21 November 2009).

  25. 25.

    http://www.dbrs.com/about (last visited 21 November 2009).

  26. 26.

    S. L. Schwarcz, The Role of Rating Agencies in Global Market Regulation (2001) 299–301; R. Trigo Trindade and M. Senn, Control and Responsibility of Rating Agencies in Switzerland (2006) 141.

  27. 27.

    Case 116 Ib 331 of 11 December 1990. See Consideration E.3.b); see also Moody’s Bank Credit Report, Crédit Suisse, October 1989, 4 and Moody’s Corporate Credit Report, CS First Boston, Inc., Financière Crédit Suisse – First Boston, April 1990; Trigo Trindade and Senn, supra note 26, 144.

  28. 28.

    Report on the Activities of Credit Rating Agencies, Report of the Technical Committee of IOSCO (September 2003) and IOSCO Statement of Principles regarding the Activities of Credit Rating Agencies, Statement of the Technical Committee of IOSCO (September 2003). Beside IOSCO, other bodies established reports on specific issues related to the use of ratings, for instance the Committee on the Global Financial System (CGFS) published a report entitled ‘The role of ratings in structured finance: issues and implications in 2005’ (January 2005).

  29. 29.

    Code of Conduct Fundamentals for Credit Rating Agencies (Revised May 2008); see also: A Review of Implementation of the IOSCO Code of Conduct Fundamentals for Credit Rating Agencies (March 2009).

  30. 30.

    Regulation (EC) No 1060/2009 of the European Parliament and of the Council of 16 September 2009 on Credit Rating Agencies; Credit Rating Agency Reform Act of 2007, September 29, 2006, Pub. L. No. 109–291 (2006); 17 CFR Parts 240 and 249b Oversight of Credit Rating Agencies Registered as Nationally Recognized Statistical Rating Organizations; Final Rule, June 18, 2007; Amendments to Rules for Nationally Recognized Statistical Rating Organizations, Exchange Act Release No. 34-59342 (February 2, 2009) (“SEC Final Rule”), 16–31; J. C. Coffee, Gatekeepers, The Role of the Professions in Corporate Governance (2006) 283–314.

  31. 31.

    International Convergence of Capital Measurement and Capital Standards, A Revised Framework, Basel Committee on Banking Supervision (BCBS), Bank for International Settlements (BIS) (June 2004, updated version of November 2005) 23–24.

  32. 32.

    Braithwaite and Drahos, supra note 5, 488–494; J. Benjamin, Financial Law (2007) 514–517.

  33. 33.

    Report on the Activities of Credit Rating Agencies, IOSCO (September 2003) 6; Trigo Trindade and Senn, supra note 26, 145–146; Exclusion Zone: Regulators Promise a Belated Review of the Ratings Oligopoly, in: The Economist (February 8, 2003) 65.

  34. 34.

    Trigo Trindade and Senn, supra note 26, 138–140; Article 7 ‘Unlawful practices of enterprises having a dominant position’ of the Federal Act on Cartels and Other Restraints of Competition (Cartel Act; LCart) of 6 October 1995 (text as of 23 March 2004) SR 251.

  35. 35.

    Annual Report on Nationally Recognized Statistical Rating Organizations, As Required by Section 6 of the Credit Rating Agency Reform Act of 2006, U.S. Securities and Exchange Commission, June 2008, 1 et seqq.; Coffee, supra note 30, 304–306.

  36. 36.

    Black, supra note 5, 76 et seqq.

  37. 37.

    Regulating the professions, Taking care of their own, in: The Economist (December 18th 2004) 62–63.

  38. 38.

    Agreement on the Swiss banks’ code of conduct with regard to the exercise of due diligence (CDB 08) from SwissBanking, Swiss Bankers Association, of 7 April 2008; P. Nobel, Die neuen Standesregeln zur Sorgfaltspflicht der Banken (1987) 149 et seqq.; P. Nobel, Die Sorgfaltspflicht des Bankiers (1985) 222; Case 105 Ib 348 of 25 October 1979; Case 109 Ib 146 of 3 June 1983; see also: A. Abegg, Regulierung hybrider Netzwerke im Schnittpunkt von Wirtschaft und Politik (2006) 266–290.

  39. 39.

    Agreement on the Swiss banks’ code of conduct with regard to the exercise of due diligence (CDB 08); supra note 38, 7.

  40. 40.

    Baldwin and Cave, supra note 1, 39 et seq., with further references.

  41. 41.

    A. Marti, Selbstregulierung anstelle staatlicher Gesetzgebung? (2000) 566, with further references; Priest, supra note 3, 245 et seq., with further references.

  42. 42.

    http://www.responsiblecare.org/ (last visited 21 November 2009).

  43. 43.

    B. M. Hutter, The Role of Non-State Actors in Regulation (2006) 4, with further references; Priest, supra note 3, 248–249.

  44. 44.

    Priest, supra note 3, 247–251, with further references, in particular from practical cases. See also the decision of the Swiss Federal High Court, Case 125 IV 139 of April 1999; Chapter 5, point 3 A Process of Transformation into State Regulation.

  45. 45.

    P. S. Berman, From International Law to Law and Globalization (2005) 546–549; J. Black, The Decentred Regulatory State? (2007) 267, with further references.

  46. 46.

    Priest, supra note 3, 245 et seq., with further references.

  47. 47.

    Case 125 IV 139 of April 1999, 144; P. Nobel, Gesetz oder private Selbstregulierung? (1987) 456 seq.; Nobel (1987), supra note 38, 156 seq.; see also the Annex to the Circular of the FINMA: Self-regulation recognized as a minimum standard by the Swiss Financial Market Supervisory Authority of 20 November 2008, FINMA-Circ. 08/10 Self-regulation as a minimum standard.

  48. 48.

    Case 125 IV 139 of April 1999; G. Friedli, Übersicht über die Praxis der Aufsichtskommission zur Sorgfaltspflicht der Banken 1998–2001 (2002) 165–167; see also: Abegg, supra note 38, 266–290.

  49. 49.

    J. Black, Decentring Regulation: Understanding the Role of Regulation and Self-Regulation in a ‘Post-Regulatory’ World (2001) Volume 54, 120.

  50. 50.

    Ayres and Braithwaite, supra note 3, 102–109; J. Braithwaite, Enforced self-regulation: A new strategy for corporate crime control (June 1982) 1466–1507.

  51. 51.

    Hutter, supra note 43, 5; J.-P. Robé, Multinational Enterprises: The Constitution of a Pluralistic Legal Order (2006) 52–53; E. Rock and M. Wachter, Islands of Conscious Power: Law, Norms and the Self-governing Corporation (2001) 1 et seqq.

  52. 52.

    Preface by the Editors, E. Gepken-Jager, G. van Solinge, L. Timmerman (eds.), VOC 1602-2002 400 Years of Company Law, Law of Business and Finance (2005) IX–XII.

  53. 53.

    G. A. Ferrarini, Origins of Limited Liability Companies and Company Law Modernisation in Italy: A Historical Outline (2005) n 52, 189–215.

  54. 54.

    For a basic introduction, see: A. A. Berle and G. C. Means, The Modern Corporation and Private Property (1991).

  55. 55.

    Here, the state, with which a relationship exists since it defines company law rules, is considered to be in the background. C. Parker, The Open Corporation, Effective Self-Regulation and Democracy (2002) 277.

  56. 56.

    Priest, supra note 3, 256.

  57. 57.

    Ibid. 256–257; see also: C. Coglianese, D. Lazer, Management-Based Regulation: Prescribing Private Management to Achieve Public Goals (2007) 423–462.

  58. 58.

    Ayres and Braithwaite, supra note 3, 101; see also Baldwin and Cave, supra note 1, 133–136; Hutter, supra note 43, 5; see also: B. M. Hutter, Is Enforced Self-regulation a Form of Risk Taking?: The Case of Railway Health and Safety (2001) 29, 379–400.

  59. 59.

    R. H. Coase, The Nature of the Firm (1937) 386–405; Ayres and Braithwaite, supra note 3, 3 et seq., 102–103; Priest, supra note 3, 257; Rock and Wachter, supra note 51, 16–27, 28–33; see also M. Ruffner, Die ökonomischen Grundlagen eines Rechts der Publikumsgesellschaft (2000) 69 et seqq.

  60. 60.

    Hutter, op., cit., n 43, 5. For a detailed discussion of the advantages and disadvantages, see Ayres and Braithwaite, supra note 3, 110–116 and 120–128; see also Priest, supra note 3, 258; Coglianese and Lazer, supra note 57, 423–462; Braithwaite, supra note 50, 1469–1474.

  61. 61.

    Rock and Wachter, supra note 51, 16–17.

  62. 62.

    Ayres and Braithwaite, supra note 3, 103–104.

  63. 63.

    Of July 2002, updated 2007, http://www.economiesuisse.ch/web/de/themen/wettbewerb/cp/Seiten/default.aspx (last visited 23 November 2009).

  64. 64.

    Directive Corporate Governance, DCG, version 29 October 2008, http://www.six-exchange-regulation.com/regulation/directives/being_public_en.html (last visited 28 November 2009).

  65. 65.

    Directive Management Transactions, DMT, version 29 October 2008, http://www.six-exchange-regulation.com/admission_manual/06_16-DMT_en.pdf (last visited 28 November 2009).

  66. 66.

    Swiss Code of Best Practice for Corporate Governance, economiesuisse, Annex 1, 6; Directive on Information Relating to Corporate Governance (Corporate Governance Directive, DCG) of July 2002, as of 1 January 2007, Annex, SIX Swiss Exchange, 5; Peter Böckli, Harte Stellen im Soft Law, Zum Swiss Code of Best Practice for Corporate Governance (2002) 982.

  67. 67.

    Böckli, supra note 66, 981–992.

  68. 68.

    Article 663bbis and article 663c paragraph 3 of the Code of Obligations; Botschaft zur Änderung des Obligationenrechts (Transparenz betreffend Vergütungen an Mitglieder des Verwaltungsrates und der Geschäftsleitung) vom 23. Juni 2004, BBl Nr. 30, 4471 et seq.; Botschaft zur Änderung des Obligationenrechts (Aktienrecht und Rechnungslegungsrecht sowie Anpassungen im Recht der Kollektiv- und der Kommanditgesellschaft, im GmbH-Recht, Genossenschafts-, Handelsregister- sowie Firmenrecht) vom 21. Dezember 2007, BBl Nr. 11, 18 March 2008, 1589–1750, 1606 et seqq.

  69. 69.

    Priest, supra note 3, 266, with further references.

  70. 70.

    Ayres and Braithwaite, supra note 3, 102.

  71. 71.

    J. L. Harrison, T. D. Morgan, P. R. Verkuil, Regulation and Deregulation (2004) 495.

  72. 72.

    Baldwin and Cave, supra note 1, 243–244; A. Shleifer, A theory of yardstick competition (Autumn 1985) 319–327; Harrison, Morgan, Verkuil, supra note 71, 495–496; for a case study, see: P. Parker, K. Namwoon, National Brands Versus Private Labels: An Empirical Study of Competition, Advertising and Collusion (1997) 220–235.

  73. 73.

    Black, op cit., n 49, 120–121, with reference to H. Collins.

  74. 74.

    S. J. Palmisano, The Globally Integrated Enterprise (May/June 2006) 127–136; Hungry tiger, dancing elephant, How India is changing IBM’s world, in: The Economist (April 7th 2007) 65–67.

  75. 75.

    E. Gepken-Jager, Verenigde Oost-Indische Compagnie (VOC), The Dutch East India Company (2005) 41–81.

    A case study on the mode of action of VOC is presented by: J. G. Nagel, The Company and the Port City: Trading centres of the Malay Archipelago and their role in commercial networks during the seventeenth and eighteenth centuries (2004) 249–273.

  76. 76.

    Robé, supra note 51, 52–53; see also C. Parker, The Open Corporation, Effective Self-Regulation and Democracy (2002) 277; G. Teubner, Codes of Conduct multinationaler Unternehmen, Unternehmensverfassung jenseits von Corporate Governance und gesetzlicher Mitbestimmung (2007) 2; L. Engwall, Global enterprises in fields of governance (2006) 161–179.

  77. 77.

    See Chapter 2, point 3 Institutional Structure, 3.2 Collectivity: From Associability to Association; J. Delbrück, The Role of the United Nations in Dealing with Global Problems (Spring 1997) 291; W. Cragg, Multinational Corporations, Globalisation, and the Challenge of Self-Regulation (2004) 213 et seqq.

  78. 78.

    Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy, International Labour Office, Geneva, 3rd ed., 2001, 2; http://www.ilo.org/wcmsp5/groups/public/---dgreports/---dcomm/documents/normativeinstrument/kd00121.pdf (last visited 28 November 2009).

  79. 79.

    http://www.unglobalcompact.org/AboutTheGC/TheTenPrinciples/index.html; http://www.unglobalcompact.org/AboutTheGC/index.html (last visited 28 November 2009).

  80. 80.

    http://www.unglobalcompact.org/AboutTheGC/index.html (last visited 28 November 2009); A.-M. Slaughter, Sovereignty and Power in a Networked World Order (2004) 307–311.

  81. 81.

    http://www.unhchr.ch (last visited 28 November 2009); UN Document E/CN.4/Sub.2/2003/12/Rev.2; K. Nowrot, Die UN-Norms on the Responsibility of Transnational Corporations and Other Business Enterprises with Regard to Human Rights, Gelungener Beitrag zur transnationalen Rechtsverwirklichung oder das Ende des Global Compact? (September 2003); C. Hillemanns, UN Norms on the Responsibilities of Transnational Corporations and Other Business Enterprises with regard to Human Rights (October 2003) 1065–1080; M. E. Cloghesy, A Corporate Perspective on Globalisation, Sustainable Development, and Soft Law (2004) 323–328.

  82. 82.

    http://www.icgn.org/ (last visited 30 November 2009); http://www.ecgi.org/organisation/overview.htm (last visited 30 November 2009); see also P. Nobel, Transnationales und Europäisches Aktienrecht (2006) 703–782, regarding international standards applying to company law.

  83. 83.

    Robé, supra note 51, 52–53.

  84. 84.

    W. C. Jenks, Multinational Entities in the Law of Nations (1972) 80.

  85. 85.

    A. Sajó, Transnational Networks and Constitutionalism (2006) 213.

  86. 86.

    Cragg, supra note 77, 213 et seqq.; B. Hunt, The Timid Corporation, Why Business is Terrified of Taking Risk (2003) 51–54, 61–67.

  87. 87.

    Hutter, supra note 43, 5.

  88. 88.

    K. Nowrot, Legal Consequences of Globalization: The Status of Non-Governmental Organizations under International law (Spring 1999) 589 et seq.

  89. 89.

    Baldwin and Cave, supra note 1, 133; Ayres and Braithwaite, op. cit. n 3, 102.

  90. 90.

    See the study by the US Securities and Exchange Commission, Concept Release Concerning Self-Regulation, 17 CFR Part 240, Release No. 34-50700; File No S7-40-04; RIN 3235-AJ36 of November 18, 2004, point II. Foundations of Self-Regulation; Priest, supra note 3, 260–261, point II; R. Sobel, The Big Board, A History of the New York Stock Market (1965) 14–27, as cited in the Concept Release Concerning Self-Regulation.

  91. 91.

    Sobel, supra note 90, 30–31 and 38–40, as cited in Concept Release Concerning Self-Regulation, supra note 90, point II; J. Seligman, The Transformation of Wall Street: A History of the Securities and Exchange Commission and Modern Corporate Finance (2003) 1–38.

  92. 92.

    Concept Release Concerning Self-Regulation, supra note 90, point II, with further references.

  93. 93.

    Braithwaite and Drahos, supra note 5, 492.

  94. 94.

    http://www.nyse.com/about/history/1089312755484.html (last visited 25 November 2009); http://www.finra.org/index.htm (last visited 25 November 2009); SEC Gives Regulatory Approval for NASD and NYSE Consolidation, 2007-151, July 26, 2008, http://www.sec.gov/news/press/2007/2007-151.htm (last visited 25 November 2009).

  95. 95.

    The Swiss regime of exchange regulation is briefly discussed hereafter as a case of delegated self-regulation; in particular, it offers less discretionary powers to the exchanges. It corresponds to a form of coercive self-regulation. However, some regulatory aspects remain co-regulatory and can lead to ambiguous solutions, as the example of enforcement measures adopted by the SIX Swiss Exchange discussed in Chapter 4, point 2 Standardization, 2.3 Gradual Transformation, 2.3.2 Impact, will show.

  96. 96.

    Ayres and Braithwaite, supra note 3, 102; Chapter 2, point 3 Institutional Structure, 3.2 Collectivity: From Associability to Association; P. Grabosky and J. Braithwaite, Of Manners Gentle: Enforcement Strategies of Australian Business Regulatory Agencies (1986) 83.

  97. 97.

    Priest, supra note 3, 262 et seqq.

  98. 98.

    As discussed hereinafter; Priest, supra note 3, 262 et seqq.

  99. 99.

    D. C. Michael, Cooperative Implementation of Federal Regulations (1996) 535, 543–553.

  100. 100.

    Concept Release Concerning Self-Regulation, supra note 90, point IV.; Priest, supra note 3, 260–261.

  101. 101.

    Directive 2004/25/EC of the European Parliament and of the Council of 21 April 2004 on takeover bids, OJ L 142, 30/04/2004, 12–23; Chapter 1 of Part 28 of the Companies Act 2006;http://www.thetakeoverpanel.org.uk/structure/about-the-panel and http://www.thetakeoverpanel.org.uk/structure/legislative-basis (last visited 8 January 2010).

  102. 102.

    Section 955 of the Companies Act 2006 and section 11 of the Introduction to the Takeover Code; http://www.thetakeoverpanel.org.uk/wp-content/uploads/2008/11/code.pdf; http://www.thetakeoverpanel.org.uk/the-code/compliance (last visited 8 January 2010).

  103. 103.

    Priest, supra note 3, 299–300; see also: IOSCO Report of the SRO Consultative Committee of the International Organization of Securities Commissions, Model for Effective Regulation (May 2000).

  104. 104.

    Michael, supra note 99, 545–546; Priest, supra note 3, 265–267.

  105. 105.

    Federal Act on Securities Exchanges and Securities Trading (Securities Exchange Act, SESTA) of March 24, 1995, SR 954.1, unofficial translation; P. Nobel, Schweizerisches Finanzmarktrecht, Einführung und Überblick (2004) 23–24, 758–765; E. Stupp, D. Dubs, Verhaltensregeln (2007) 150–166.

  106. 106.

    Marti, supra note 41, 566–567, with further references; Priest, supra note 3, 250 et seq.

  107. 107.

    Nobel, supra note 105, 484 et seq.; Circular of the FINMA: Self-regulation recognized as a minimum standard by the Swiss Financial Market Supervisory Authority of 20 November 2008, FINMA-Circ. 08/10 Self-regulation as a minimum standard.

  108. 108.

    K. W. Abbott, D. Snidal, The International Standards Process: Setting and Applying Global Business Norms (2005) 112.

  109. 109.

    Priest, supra note 3, 266; Marti, supra note 41, 570–577.

  110. 110.

    Concept Release Concerning Self-Regulation, supra note 90, point IV.

  111. 111.

    Principles-based regulation, Focusing on the outcomes that matter. FSA, April 2007, 4–6.

  112. 112.

    Marti, supra note 41, 570–577. See also the description of C. Errass, Kooperative Rechtssetzung (2010), 81–90.

  113. 113.

    M. Thatcher and A. Stone Sweet, Theory and Practice of Delegation to Non-Majoritarian Institutions (January 2002) 1, 3; M. Thatcher, Delegation to Independent Regulatory Agencies: Pressures, Functions and Contextual Mediation (January 2002) 125, 125–131; M. Shapiro, Judicial Delegation Doctrines: The US, Britain, and France, (January 2002) 173, 173–175; also Senn, supra note 9, 444; Marti, supra note 41, 572–574.

  114. 114.

    J. Black, Rules and Regulators (1997) 79.

  115. 115.

    Priest, supra note 3, 252 et seq.

  116. 116.

    See above, point 1 Self-Regulation, 1.2 Credit Rating Agencies; Credit Rating Agency Reform Act of 2006, September 29, 2006, Pub. L. No. 109-291 (2006); 17 CFR Parts 240 and 249b Oversight of Credit Rating Agencies Registered as Nationally Recognized Statistical Rating Organizations; Final Rule, June 18, 2007.

  117. 117.

    Marti, supra note 41, 567 et seq.; Priest, supra note 3, 252–256.

  118. 118.

    Marti, supra note 41, 574.

  119. 119.

    Gesetz betreffend die Gewerbe der Effektensensale und Börsenagenten of 2nd December 1883; R. T. Meier, T. Sigrist, Der helvetische Big Bang, Die Geschichte der SIX Swiss Exchange (2006) 21–61.

  120. 120.

    Articles 3 and 4 SESTA; Nobel, supra note 105, 773 et seqq.; P. Böckli, Zum Börsengesetz von 1995: neue Rechtsinstitute und neue Probleme (1998) 228–233.

  121. 121.

    Chapter 1, point 4 Institutions; Marti, supra note 41, 570–572, with further references.

  122. 122.

    Priest, supra note 3, 266.

  123. 123.

    Ibid. 266.

  124. 124.

    Ayres and Braithwaite, supra note 3, 103; Priest, supra note 3, 266.

  125. 125.

    H. C. Kunreuther, P. J. McNulty, and Y. Kang, Third-Party Inspection as an Alternative to Command and Control Regulation (2002) 309–318.

  126. 126.

    Unofficial translation, Botschaft des Bundesrates an die Bundesversammlung betreffend den Entwurf eines Bundesgesetzes über die Banken und Sparkassen of 2nd February 1934, BBl 1934 I 179.

  127. 127.

    Hutter, supra note 43, 6; Kunreuther, McNulty, and Kang, supra note 125, 309–318.

  128. 128.

    Case 99 Ib 104, 110, E. 5., of 4 May 1973.

  129. 129.

    Unofficial translation, BBl 1934 I, supra note 126, 179–182.

  130. 130.

    See in particular article 44 and 45 Banking Ordinance.

  131. 131.

    Case 117 II 317 of 20 September 1991; P. Nobel, Freiheit und Ordnung im Kapitalmarktrecht (1998) 121–126. Whether this will still be the case following the introduction of the Federal Act on Auditors’ Authorization and Supervision of 16 December 2005, SR 221.302, remains open at this stage.

  132. 132.

    D. C. Michael, Federal Agency use of Audited Self-Regulation as a Regulatory Technique (Spring 1995) 176.

  133. 133.

    Ibid. 175 et seq.; Priest, supra note 3, 260.

  134. 134.

    Priest, supra note 3, 260.

  135. 135.

    Ibid. 254; for examples of enforcement pyramids, see Ayres and Braithwaite, supra note 3, 35–40.

  136. 136.

    Article 24-28 Federal Act on Money Laundering of 10 October 1997 (FAML) SR 955.0.

  137. 137.

    Article 14 and 28 FAML respectively.

  138. 138.

    Black, Decentred Regulatory State, supra note 45, 266–267; Financial Services Authority, Newsletter of the FSA, January 2006; FSA, Reviewing our Money Laundering Regime PS06/1.

  139. 139.

    Kunreuther, McNulty, and Kang, supra note 125, 309–318; Hutter, supra note 43, 6; Coglianese and Lazer, supra note 57, 449–451; on the Société Générale de Surveillance: Braithwaite and Drahos, supra note 5, 287, 492–493, 618–619.

  140. 140.

    Priest, supra note 3, 301.

  141. 141.

    Michael, supra note 132, 179–184; Braithwaite and Drahos, supra note 5, 287; Harrison, Morgan, Verkuil, supra note 71, 505–516.

  142. 142.

    Michael, supra note 132, 171–251; Priest, supra note 3, 259–260.

  143. 143.

    M. Koskenniemi, Fragmentation of International Law: Difficulties arising from the Diversification and Expansion of International Law (13, April 2006) 11–14; A. Fischer-Lescano and G. Teubner, Regime-Collisions: The Vain Search for Legal Unity in the Fragmentation of Global Law (Summer 2004) 1001–1002.

  144. 144.

    Case of the S.S. ‘Wimbledon’, P.C.I.J. Series A., No. 1 (1923), 23–24.

  145. 145.

    Case concerning the United States Diplomatic and Consular Staff in Tehran (United States of America v. Iran) I.C.J. Reports 1980, 38, para. 83; United States Diplomatic and Consular Staff in Tehran, I.C.J. Reports 1980, 38 and 40; see also: B. Simma, Self-Contained Regimes (1985) 113.

  146. 146.

    W. Riphagen, Third Report on State Responsibility (1982) para. 35; Simma, supra note 145, 115; Koskenniemi, supra note 143, 74. Primary and secondary rules are not to be understood in the sense of Hart’s distinction between primary and secondary rules; H.L.A. Hart, The Concept of Law (1997) 79 et seqq.; see Chapter 4, point 2 Standardization, 2.3 Gradual Transformation, 2.3.2 Impact.

  147. 147.

    Simma, supra note 145, 117–119, 135–136.

  148. 148.

    Koskenniemi, supra note 143, 91–100. On self-contained regimes, see also: L.A.N.M. Barnhoorn and Karel Wellens (eds.), Diversity in Secondary Rules and the Unity of International Law (1995).

  149. 149.

    Koskenniemi, supra note 143, 68; Barnhoorn and Wellens, supra note 148; Fischer-Lescano and Teubner, supra note 143, 999–1046; on the distinction between primary and secondary rules, see: Hart, supra note 146.

  150. 150.

    Koskenniemi, supra note 143, 71–72, 87; Sassen, supra note 4, 267–268.

  151. 151.

    Koskenniemi, supra note 143, 70, with further references, 87–90.

  152. 152.

    The Oxford English Dictionary, Volume XIV (1991) 917.

  153. 153.

    Fischer-Lescano and Teubner, supra note 143, 1013, with reference to Koskenniemi; Fischer-Lescano and Teubner, Regime-Kollisionen, supra note 3, 50; Koskenniemi, supra note 143, 65–73.

  154. 154.

    Fischer-Lescano and Teubner, supra note 143, 1014–1017; on the concept of neutrality, see Sajó, supra note 85, 14–15.

  155. 155.

    Koskenniemi, supra note 143, 83 et seqq.; Fischer-Lescano and Teubner, supra note 143, 1015; Simma, supra note 145, 111, 245.

  156. 156.

    For a discussion of practical issues, see D. Weinberger, Everything is Miscellaneous, The power of the new digital disorder (2007); D. L. Spar, Lost in (Cyber)space: The Private Rules of Online Commerce (1999) 31–51; D. L. Spar, Ruling the Waves, Cycles of Discovery, Chaos, and Wealth from the Compass to the Internet (2001); D. L. Spar, The Public Face of Cyberspace (1999) 344–362.

  157. 157.

    Sassen, supra note 4, 328–329.

  158. 158.

    Berman, supra note 3, 397–400.

  159. 159.

    U. Gasser, Regulating Search Engines: Taking Stock and Looking Ahead (Spring 2006) 124–157.

  160. 160.

    Memorandum of Understanding between the U.S. Department of Commerce and Internet Corporation for Assigned Names and Numbers, of 25 November 1998; http://www.icann.org/en/general/icann-mou-25nov98.htm (last visited 25 November 2009).

  161. 161.

    http://www.icann.org/; http://www.icann.org/en/general/bylaws.htm; http://www.icann.org/en/factsheets/ (last visited 25 November 2009).

  162. 162.

    Braithwaite and Drahos, supra note 5, 501–506; Hutter, supra note 43, 11; Senn, supra note 9, 461–463; S. L. Schwarcz, Private Ordering (Fall 2002) 319–350.

  163. 163.

    http://www.icann.org/en/factsheets/ (last visited 25 November 2009).

  164. 164.

    Sajó, supra note 85, 22–23, with further references.

  165. 165.

    H. Willke, Systemtheorie III: Steuerungstheorie (1998) 112–121.

  166. 166.

    Braithwaite and Drahos, supra note 5, 112.

  167. 167.

    Sassen, supra note 4, 261, 330; G. Majone, The New European Agencies: Regulation by Information (1997) 262–275; G. Majone, The European Commission: The Limits of Centralization and the Perils of Parliamentarization (2002) 382–388; G. Majone, Delegation of Regulatory Powers in a Mixed Polity (2002) 336; Senn, supra note 9, 462.

  168. 168.

    Article 14 paragraph 2bis Code of Obligations, CO, SR 202, which entered into force on 1 January 2005 together with the Federal Act on Certification Services in the Domain of the Electronic Signature (Law on the Electronic Signature, SCSE, SR 943.03), which entered into force on the same date.

  169. 169.

    In that ruling, a French court has addressed the jurisdictional issue and claimed the power to regulate the content of an American website accessible in France. The suit was brought both against Yahoo.fr and Yahoo.com. The court issued a preliminary injunction against Yahoo.com, ordering the site to take all possible measures to dissuade and prevent access in France of Yahoo! auction sites that sell Nazi memorabilia or other items that are sympathetic to Nazism or constitute holocaust denial, because it would violate French law. Yahoo.fr complied with requests that access to these – indeed non-French – sites stored on Yahoo!’s non-French servers should be blocked. Tribunal de Grande Instance de Paris, Ordonnance de référé, 22 mai 2000, UEJF et Licra c/ Yahoo! Inc. et Yahoo France; Tribunal de Grande Instance de Paris, Ordonnance de référé du 11 août 2000, UEJF et al. c/ Yahoo! Inc. et Yahoo France; Tribunal de Grande Instance de Paris, Ordonnance de référé du 20 novembre 2000, UEJF et Licra c/ Yahoo! Inc. et Yahoo France; http://www.juriscom.net/txt/jurisfr/cti/tgiparis20000522.htm (last visited 16 December 2009); Berman, supra note 3, 336.

  170. 170.

    Berman, supra note 3, 397–398.

  171. 171.

    On legitimacy, see Chapter 4, point 2 Standardization, 2.4 Nature of Autonomous Regulatory Regimes, 2.4.2 Legitimacy and Accountability.

  172. 172.

    See also K. Raustiala, The Architecture of International Cooperation: Transgovernmental Networks and the Future of International Law (2002) 6, in relation to international law.

  173. 173.

    Majone (1997) supra note 167, 262–275; Majone (July 2002) supra note 167, 382–383; Majone, (September 2002) supra note 167, 336; Senn, supra note 9, 462; Willke, supra note 165, 112–121; A.-M. Slaughter, supra note 80, 312; Raustiala, supra note 172, 10 et seqq.

  174. 174.

    Majone (1997) supra note 167, 262–275, 262, 272; see also R. O. Keohane, Governance in a Partially Globalized World (March 2001) 1–13, at 9.

  175. 175.

    Berman, supra note 3, 437–440.

  176. 176.

    http://www.iso.org/iso/about/the_iso_story/iso_story_founding.htm (last visited 16 December 2009).

  177. 177.

    http://www.standardsinfo.net/info/livelink/fetch/2000/148478/6301438/inttrade.html (last visited 16 December 2009).

  178. 178.

    http://www.iso.org/iso/home.htm (last visited 17 December 2009).

  179. 179.

    http://www.iasb.org/The+organisation/IASCF+and+IASB.htm (last visited 16 December 2009); Hutter, supra note 43, 9.

  180. 180.

    http://www.iso.org/iso/home.htm (last visited 16 December 2009); for a discussion of a concrete example, The Birth of MP3, see Spar (2001) supra note 156, 337–341.

  181. 181.

    For criteria applying to the definition of an international organization in the sense of international law, see: I. Seidl-Hohenveldern and G. Loibl, Das Recht der Internationalen Organisationen einschliesslich der Supranationalen Gemeinschaften (2000) 1–7; see also D. Zaring, International Law by Other Means: The Twilight Existence of International Financial Regulatory Organizations (1998) 304–308, with a focus on organizations in the field of financial markets.

  182. 182.

    C. Scott, Regulating Private Legislation (2007) 4.

  183. 183.

    http://www.iso.org/iso/home.htm (last visited 16 December 2009); Black, supra note 45, 266, 270; Braithwaite and Drahos, supra note 5, 503; Seidl-Hohenveldern and Loibl, supra note 181, 3–5; E. E. Meidinger, Look Who’s Making the Rules: International Environmental Standard Setting by Non-Governmental Organizations (1997) 52–54; see also V. Haufler, Private sector international regimes (2000) 123–137.

  184. 184.

    For an overview, see for instance: Braithwaite and Drahos, supra note 5, 88, 92–93.

  185. 185.

    Braithwaite and Drahos, supra note 5, 116; M. Giovanoli, A new architecture for the global financial market: legal aspects of international financial standard setting (2000) 6–10; B. A. Simmons, The Legalization of International Monetary Affairs (Summer 2000) 573–602; B. A. Simmons, International Law and State Behavior: Commitment and Compliance in International Monetary Affairs (December 2000) 819–835; M. Marcussen, The transnational governance network of central bankers (2006) 180–204; for an introduction, see also: A. Kern, R. Dhumale, J. Eatwell, Global governance of financial systems – The International Regulation of Systemic Risk (2006) 79 et seqq.

  186. 186.

    See for instance the Report of the Financial Stability Forum on Enhancing Market and Institutional Resilience, 7 April 2008, http://www.financialstabilityboard.org/ (last visited 8 January 2010). A number of studies have been published before the crisis: H. Davies and D. Green, Global Financial Regulation, The Essential Guide (2008); Giovanoli, supra note 185, discussing the ‘old’ architecture; Kern, Dhumale, Eatwell, supra note 185; R. H. Weber and D. W. Arner, Toward a New Design for International Financial Regulation (Winter 2007) 391–453; V. Schreiber, International Standards, Neues Recht für die Weltmärkte? (2005) 15 et seqq.

  187. 187.

    On the Core Principles, see: http://www.bis.org/publ/bcbs129.htm (last visited 7 January 2010); on Basle II, see: International Convergence of Capital Measurement and Capital Standards: A Revised Framework – Comprehensive Version, June 2006 (first published in September 1997), http://www.bis.org/publ/bcbs128.htm and http://www.bis.org/bcbs/index.htm (last visited 7 January 2010); Zaring, supra note 181, 287–291; K. P. Follak, International Harmonization of Regulatory and Supervisory Frameworks (2000) 291–322; T. Porter, States, Markets and Regimes in Global Finance (1993) 58 et seqq.; P. Nobel, Globalization and International Standards with an emphasis on Finance Law (2005) 56–57.

  188. 188.

    http://www.iosco.org/about/ (last visited 7 January 2010); Zaring, supra note 181, 292–297.

  189. 189.

    http://www.iosco.org/library/index.cfm?section=pubdocs&year=1998 (last visited 7 January 2010); Porter, supra note 187, 111 et seqq.

  190. 190.

    http://www.iaisweb.org/ (last visited 7 January 2010); Zaring, supra note 181, 297–301.

  191. 191.

    G20, London Summit, 2 April 2009, “Declaration on Strengthening the Financial System”; http://www.financialstabilityboard.org/index.htm (last visited 8 January 2010). Regarding the efforts undertaken by the European Union to introduce a new institutional order, see: E. Wymeersch, The reforms of the European Financial Supervisory System – An Overview, (July 2010) 240–265.

  192. 192.

    http://www.financialstabilityboard.org/about/overview.htm (last visited 8 January 2010). Zaring, supra note 181, 287–304; Giovanoli, supra note 185, 11–14.

  193. 193.

    A.-M. Slaughter, Global Government Networks, Global Information Agencies, and Disaggregated Democracy (2003) 1045, 1046–1048; Braithwaite and Drahos, supra note 5, 97, 101–105; Berman, supra note 45, 500–502; D. W. Arner, Financial Stability, Economic Growth, and the Role of Law (2007) 74 et seqq.

  194. 194.

    http://www.financialstabilityboard.org/index.htm (last visited 8 January 2010); Giovanoli, supra note 185, 12–13.

  195. 195.

    http://www.financialstabilityboard.org/index.htm (last visited 8 January 2010).

  196. 196.

    Zaring, supra note 181, 285, 304–308; Seidl-Hohenveldern und Loibl, supra note 181, 1–7.

  197. 197.

    Sassen, supra note 4, 261; Zaring, supra note 181, 304–308; Giovanoli, supra note 185, 21 et seqq.; Benjamin, supra note 32, 510–517.

  198. 198.

    Braithwaite and Drahos, supra note 5, 119; Chapter 1, point 2 The Impact of (Public) Policy Issues; 2.8 Contribution of the OECD; http://www.oecd.org/topic/0,3373,en_2649_37421_1_1_1_1_37421,00.html (last visited 16 December 2010).

  199. 199.

    Braithwaite and Drahos, supra note 5, 8; Sassen, 2006, supra note 4, 328; S. Sassen, Global financial centers (1999) 75–87, 1999; see also: R. K. McGill and T. A. Sheppey, The New Global Regulatory Landscape, Impacts on Finance and Investment (2005) 3 et seqq.; Nobel, supra note 186, 46 et seqq.

  200. 200.

    Zaring, supra note 181, 312, 327; Global Trends 2025: A Transformed World, National Intelligence Council, NIC 2008-003, November 2008, x–xi, 10.

  201. 201.

    http://www.financialstabilityboard.org/cos/index.htm, Compendium of Standards (last visited 8 January 2010). See also Giovanoli, supra note 185, 33–36; Cragg, supra note 77, 213–227; Zaring, supra note 181, 329.

  202. 202.

    Braithwaite and Drahos, supra note 5, 117, citing an 1991 OECD interview.

  203. 203.

    Sajó, supra note 85, 209 et seqq., 8–10, with further references; Zaring, supra note 181, 287–304; Giovanoli, supra note 185, 30–32, 45 et seqq.; Benjamin, supra note 32, 510–517; A.-M. Slaughter, Governing the Global Economy through Government Networks (2000) 181 et seqq.

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Senn, M. (2011). Case Studies. In: Non-State Regulatory Regimes. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-14974-0_4

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