National Courts Review of Transnational Private Regulation

Transnational private regulatory bodies (TPRs) composed of either private actors or a hybrid of public and private actors are increasingly replacing direct governmental regulation or have begun to regulate areas that have never been subject to governmental oversight. Such privately-ordered, informal arrangements typically facilitate coordination without entailing long-term commitments, rigid rules that might constrain state executives, or more than minimal public scrutiny. By increasing the information asymmetries among the various (domestic and global) stakeholders, and by evading or rendering obsolete traditional constitutional checks and balances and other oversight mechanisms, TPR threatens to exacerbate the already existing regulatory oversight deficit that globalization is widely believed to have created in many democratic states. In this essay we discuss the prospect that national courts (NCs) will take it upon themselves to directly or indirectly review these TPRs and address some of the challenges that the TPRs potentially raise with respect to economic efficiency, democracy, and equality. We describe some of the tools that NCs have developed over the years in response to privatized regulation at the domestic level and examine the constraints that NCs face in applying similar such tools to TPRs, and assess the potential and limits of NC regulation.