Chicago Journal of International Law


Because we live in a world of national laws and international business activity, the regulation of a single transaction can be affected by several different legal regimes. Within domestic systems, even if sub-units such as the states of the United States exist, there is a central government authority that can regulate such transactions. In the international arena, the problems are more difficult. There is no supranational authority able to impose international standards; attempts at harmonization must overcome greater differences in culture and legal tradition; and national lawmakers are often resistant to any form of international rulemaking. How, then, should international cooperation proceed? There is no simple answer to this question. Different legal issues require different solutions, and even within a single issue there is often strong disagreement about how to proceed. Nevertheless, the business of international cooperation must proceed. Business activity crosses national borders, and the law has no choice but to deal with that activity. Even if there is no international cooperation or coordination, domestic laws will interact with international activity affecting business decisions and human welfare. Under this laissez-faire system, each jurisdiction proceeds as it wishes, without concern for the policies of other jurisdictions. Without some coordination on choice of law rules, however, a system of this sort will almost always lead to overlapping jurisdictions, conflicting legal regimes, and over-regulation. The existing antitrust law regime fits this description. International transactions are subject to the simultaneous regulation of domestic regulators in many countries, and each national regulator operates independently. States could avoid the problem of over-regulation by limiting their jurisdiction to a narrow territorial basis, but this would instead lead to the under-regulation of many activities. [CONT]