Neo-Realism and the International Harmonization of Law: Lessons from Antitrust

Abstract

Five great attempts have been made to achieve a true international harmonization of competition law in the twentieth century. None has been successful. Despite the failures of the League of Nations, the International Trade Organization (ITO), the Economic and Social Council of the United Nations, the Organization for Economic Cooperation and Development (OECD) and the United Nations Conference on Trade and Development, the groundswell for a new round of harmonization efforts has begun again. The 1990s blueprint for international harmonization of antitrust law includes proposals for changing the jurisdiction over transnational anticompetitive behavior, the procedures for investigation of transnational competition matters and the substance of competition law, and suggestions for promoting antitrust enforcement in foreign markets as a means to enhance United States export and investment opportunities.

The most recent attempts have proceeded very differently from past efforts in this area. First, the growing recognition of links between competition policy and trade policy has focused attention on competition as a fitting topic for consideration by national trade policy planners and international trade institutions like the World Trade Organization and other bodies. Second, the growing number of countries that enforce reasonably comprehensive and sophisticated systems of competition law has produced pressure from the business community and national governments to work toward more uniform systems of notification by private parties and greater cooperation between national authorities, and has created a desire for more uniform rules of both jurisdiction and substantive law. Third, continuing conflict between nations over the investigation and enforcement of competition provisions that affect important national interests provides a further impetus for harmonization. Finally, the adoption of new competition regimes in the developing market economies in eastern Europe, the former Soviet Union and throughout the developing nations of the world has invited discussion about the most appropriate content for such laws in new and diverse settings.

In this Article, I look at the transferability of law from one nation and culture to another in the context of the current movement both to harmonize and to internationalize competition law, particularly as it has developed in the United States and the European Union. Part II analyzes the transferability of national law from a number of historical and philosophical perspectives, focusing on the ideas first developed by Montesquieu and debated by comparative law scholars from Montesquieu's time to our own. Parts III, IV and V critically examine the explicit and implicit assumptions that United States antitrust law can or should serve as a model for competition law for the rest of the world. Part VI offers suggestions for the process that central and eastern European nations, and other developing market economies, should use in developing indigenous competition regimes.

I end with a call for a neo-realist approach to harmonizing international economic law. Such an approach applies much of the teaching of the legal realism movement in American jurisprudence to identify the values and governance norms underlying technical rules of competition law. Neo-realism also requires a new conception for the expert in comparative competition law and a new focus on the harmonization of values and norms in place of a wasteful search for a common global text of competition law.

Keywords: antitrust, international economic law, Montesquieu, harmonization, legal realism, legal transplants, comparative law, New Haven School, GATT, EU, OECD, Sherman Act, competition law

JEL Classification: D4, F02, F15, K21, K33, L1, L4