In association with the International Commission of Jurists

Recent Posts

07 Feb

[Pierre-Hugues Verdier, author of Mutual Recognition in International Finance, responds to the comments by Stavros Gadinis and Eric Pan] I would first like to thank Professors Pan and Gadinis for their generous and insightful comments on my article.  While it is impossible to offer a full response in this forum, I would like to offer some thoughts on three salient points. First, as Professor Pan correctly points out, financial cooperation arrangements that share important features of mutual recognition have existed for decades.  However, I believe the arrangements described in the article constitute a significant development relative to those prior approaches.  Take, for instance, the CFTC's acceptance of foreign trading screens and PCAOB's reliance on foreign auditors. 
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07 Feb

[Eric Pan, an Associate Professor of Law and Director, The Samuel and Ronnie Heyman Center on Corporate Governance, responds to Pierre-Hugues Verdier, Mutual Recognition in International Finance] Pierre-Hugues Verdier has written an extremely important paper about one of the key regulatory strategies in international finance.  As Prof. Verdier has noted, many jurisdictions have applied mutual recognition arrangements to provide cross-border access to financial services providers, issuers and investors, and he skillfully analyzes the challenges facing mutual recognition arrangements.  In order to provoke a further discussion about the importance of mutual recognition in international financial regulation, I wish to draw out some of the points made by Prof. Verdier and express additional thoughts regarding how mutual recognition arrangements have been used in the past, the implications for future mutual recognition arrangements and the main challenges facing mutual recognition arrangements.
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07 Feb

[Stavros Gadinis, an Assistant Professor of Law at U.C. Berkeley School of Law, responds to Pierre-Hugues Verdier, Mutual Recognition in International Finance] Pierre Verdier's piece, "Mutual Recognition in International Finance," centers on a fundamental question in this area of the law: how can regulators from one state admit inside their borders institutions and products shaped under another state's regime, without imposing additional requirements to admission? Lifting regulatory barriers is the primary step towards a truly global financial market, because it removes high transaction costs that constrain capital flows. However, opening the regulatory gateways to foreigners is a matter of heated debate, which typically evokes rational objections as well as deep-rooted fears: do these foreign institutions and products provide to investors similar safeguards to those honed after decades of domestic regulation? Will the sudden influx of - perhaps more cost-effective - foreign providers put the domestic industry in a competitive disadvantage? Could the admission of foreigners ultimately undermine the importance of domestic regulators by providing an official back-door channel into a closely guarded domestic market?
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07 Feb

[Pierre-Hugues Verdier, an Associate Professor of Law at the University of Virginia School of Law, describes his recently published article Mutual Recognition in International Finance] In the absence of an international organization devoted to financial regulation, the rapid globalization of finance since the 1970s has taken place against a legal background shaped primarily by national regulators.  As the multiplication of large, transnational financial institutions and cross-border transactions increased the need for international policy coordination, regulators responded by setting up transgovernmental regulatory networks (TRNs) and adopting soft law instruments.  In an article published in 2009, I argued that TRNs suffered from significant limitations stemming from domestic legal and political constraints, their inability to overcome distributive obstacles to harmonization, and their lack of monitoring and enforcement capabilities.  In the aftermath of the financial crisis, many commentators agree that existing coordination mechanisms did not live up to expectations in pivotal areas such as bank capital standards.  Thus, while TRNs are likely to remain an important component of financial governance, we need a more complete understanding of the various means through which states can cooperate to ensure effective cross-border financial regulation and market access.
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06 Feb

We here at Opinio Juris are very pleased to host this coming week our first on-line symposium featuring work from the Harvard International Law Journal. For those interested in a preview of the week's events, here's the line-up: On Monday, Stavros Gadinis and Eric Pan will respond to Pierre-Hugues Verdier's article, Mutual Recognition in International Finance On Tuesday, Samuel Issacharoff will respond...

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06 Feb

Bobby Chesney has posted to SSRN an important draft paper on the law surrounding the targeting of Anwar Al-Awlaki, the Yemini-American radical Islamist cleric in hiding presumably in Yemen.  It is still in draft form (to appear in final form in the Yearbook of International Humanitarian Law), and Bobby is still revising and soliciting comments from knowledgeable folks.  Here is his comment at Lawfare; the draft paper is up on SSRN at this link. My comments on an initial read?  First, I agree with the overall structure of the analysis — the questions and the order of raising them.  One observation is that I would put less weight on sovereign consent for the jus ad bellum analysis (ie, Yemen permitting the US action).  This is in large part because in my view the bedrock international law principle for the United States is, and always has been, that although territorial integrity is foundational to legal sovereignty, a state that is either unwilling or unable to control the use of its territory by non-state actor terrorist or other armed groups acting against other sovereigns — safe havens — gives up its sovereignty and right to territorial integrity to that extent.  Whether one sees it as an exception to the territorial integrity rule, or instead that the state is failing to exercise sovereignty and so does not have it at that point over the relevant territory, it seems to me a far more important legal principle in addressing terrorist groups than sovereign consent.  The politics and diplomacy of that might be a very different matter, of course. My view of “naked” self-defense outside of armed conflict remains as it has been since the beginning of this debate over targeting, as a formal category.  However, as a factual matter regarding Al Qaeda in the Arabian Peninsula, I believe that the connections between it and AQ proper are sufficient to bring it within the AUMF; at one point I didn’t think that was the case, but I have certainly been persuaded otherwise as more facts have emerged.  In that case, the Obama administration, which has various political and domestic legal reasons for preferring the AUMF-armed conflict characterization over the naked self-defense characterization, is on firm ground.  It would in my view be on firm ground either way.  However, I remain fully committed to the view that self-defense as an independent category remains available as a legal rationale, and that it will be necessary and appropriate in future circumstances.
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05 Feb

I'm dashing off to China in a few hours, but I couldn't resist a brief post on the Second Circuit's denial of rehearing on Kiobel v. Royal Dutch.  Does anyone doubt this case is headed for the Supreme Court?  Which is not to say that I disagree with the panel majority on the merits. indeed, I have offered a full-scale...

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03 Feb

(Note:  I'm going to pull down most of this post, although alas it makes Peter's comment not relevant to anything.  Martined over at VC points out a couple of mistakes.  I think I"m going to delete anything but the reference to the news article.  Peter, apologies I've untethered your comment!) The Milwaukee Journal-Sentinel reports that the Vatican has refused service of...

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02 Feb

Perhaps not getting the coverage it might in the face of more important developments elsewhere: Pakistan continues to hold Raymond Davis, a US government official posted to Lahore, in the killing of two Pakistanis last week despite protests from the US that the official is entitled to diplomatic immunity.  Here's a report from the LA Times; here's a more detailed...

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02 Feb

This must be that vibrant democracy Richard Cohen recently extolled in defense of denying democracy to Egyptians: The Knesset House Committee on Wednesday approved the composition of two parliamentary panels to investigate the funding sources of human rights organizations. Most of the opposition parties have decided to boycott the committees. The motion passed at the House Committee by a...

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