China Law Society 2011

8/6/2019 China Law Society 2011

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Co-regulation and

mediation

Dr Chris Marsden for

China Law Society

17 May 2011, Steptoe & Johnson



Governments reassessing regulation

How can government co-exist with thingshappening outside of government?

Should the EU regulate? If so, why?

And how should it regulate, given the need toboth«

Promote competition and innovation

Protect public safety, privacy, and security?

3



Lawyers as co-regulators States reduce direct regulatory burden

Answer: devolve regulation to markets

But keep control via statute: co-regulation

Companies bring disputes to co-regulator

Cheaper? More expert? Faster? Flexible? Quasi-judicial tribunal

Court of Arbitration for Sport applied to technical

standards?



Forms of regulation are evolving

Dominant forms are formalgovernment-led co-regulation

� Government legislatesdirectly to achieve economic

and social policy goals

� Rules applied (somewhat)

uniformly in all MS

Formal(statutory)

regulation

� Recognised parties entrusted with

achieving legislative goals

� Possible government subsidy

� Delegated power or government

enforcement of rules

Co-regulation

(gov¶t-led)

5



Polycentric regulation Julia Black

Constructing and Contesting Legitimacy and

Accountability in Polycentric Regulatory Regimes

LSE Legal Studies Working Paper No. 2/2008

Decentred

Networked governance

Non-hierarchical Voluntary often



Baldwin and Black (2010) Really Responsive Risk-Based Regulation

Law & Policy, Vol. 32,2, pp.181-213

Julia Black (2010) Managing the Financial

Crisis ± The Constitutional Dimension LSE Legal Studies Working Paper No. 12/2010



Defining co-regulation Started in Australia in mid-1990s

European adoption dates to early 2000s

Lisbon µBetter Regulation¶ Agenda: 2003 Inter-institutional Agreement

Recommendation 98/560 as amended in

Recommendation on the protection of minors

and human dignity (2006/952/EC) OJ L 378 27.12.2006 p. 72.

Audiovisual Media Services (AVMS) Dir.

2007/65/EC now 2010/13/EU



Recital 36 AVMS ³self-regulation constitutes a type of

voluntary initiative,

which enables the economic operators, social

partners, NGOs or associations to adopt common guidelines amongst

themselves and for themselves

Co-regulation gives, in its minimal form,

a legal link between self-regulation and the

national legislator in accordance with the

legal traditions of the Member States.



Self- and co-regulation to complement,

substitute or forestall formal regulation

µUneasy partners,¶ impure motives both sides

Advantages and disadvantages compared to

formal regulation ± but inevitability as well Evolution: agenda creep, waning interest,

Potemkin regulators

(Self-) Regulatory competition

Self-regulation will carry on in any case

Cross market, legal boundaries

Continually rewrite rules10



Millwood-Hargrave Diagram of

SROs, regulatory type & structure

Self-

Regulation

Statutory

Regulation

Main

Incentiveto Service

Provider

Service

Provider

Unilateral

code

Brand

Self-interest

Industry

code

Industry

Assoc.

Industry

Self-interest

Code

Guardian

Self Regulation

Independent

Body

Approved

code

Threat of

sanctions

Co-Regulation

Statute

backed code

Govt.

appointed

Threat of

regulatory

intervention

Statutory Regulation

Generic Regulation: Trading Standards + Competition

Self-

Regulation

Statutory

Regulation

Main

Incentiveto Service

Provider

Service

Provider

Unilateral

code

Brand

Self-interest

Industry

code

Industry

Assoc.

Industry

Self-interest

Guardian

Self Regulation

Independent

Body

Approved

code

Threat of

sanctions

Co-Regulation

Statute

backed code

Govt.

appointed

Threat of

regulatory

intervention



Self-

Regulation

Statutory

Regulation

Main

Incentiveto Service

Provider

Service

Provider

Unilateral

code

Brand

Self-interest

Industry

code

Industry

Assoc.

Industry

Self-interest

Code

Guardian

Self Regulation

Independent

Body

Approved

code

Threat of

sanctions

Co-Regulation

Statute

backed code

Govt.

appointed

Threat of

regulatory

intervention



Self-

Regulation

Statutory

Regulation

Main

Incentiveto Service

Provider

Service

Provider

Unilateral

code

Brand

Self-interest

Industry

code

Industry

Assoc.

Industry

Self-interest

Guardian

Self Regulation

Independent

Body

Approved

code

Threat of

sanctions

Co-Regulation

Statute

backed code

Govt.

appointed

Threat of

regulatory

intervention





Co-regulation should allow for the

possibility for State intervention in theevent of its objectives not being met.

For those actions that require coordinated or

joint implementation by the [EU] institutions,

the inter-institutional agreement provide[scontext]for better regulation.

Its objective is to improve the quality of

Community legislation, its accessibility andits transposition into national law.

The agreement entrenches best practices and

sets out new objectives and commitments.



Co- and self-regulation ³will not be

applicable where fundamental rights or important political options are at stake or

where the rules must be applied in a

uniform fashion in all Member States´.

³Under co-regulation... the Parliament and

the Council will have the right to:

suggest amendments to the agreement,

object to its entry into force and, possibly,

ask the Commission to submit a proposal for

a legislative act.´



Can self-regulation be camoflaged?



Monitoring self-regulation Commission¶s role

reporting to legislators on practices regarded

as effective and satisfactory

in terms of representativeness.



Co-regulation as part of regulatory strategy

May serve public interest better than statutoryregulation

Can achieve results that statutory regulation

cannot achieve directly

OR best working in active partnership with

government regulation

extremely productive if with the right spirit

16



Constitutional implications Explicit division of powers between co-regulation and government in some domains, Separation of decision-making, monitoring,

reporting, enforcement

Implicit enforcement support; Affirmative criteria for supporting co-regulation

with resources, information, regulatory forbearance,delegated or agency enforcement power

Negative criteria for restricting co-regulators e.g. on competition policy, single market grounds



Scale Regulatory scheme Self±Co Government involvement

0 µPure¶ unenforced self-regulation

CreativeCommons

SecondLife

Informal interchange only ± evolving partialindustry forum building on players¶ own terms

1 Acknowledged self-

regulation

ATVOD Discussion, but no formal recognition/approval

2 Post-facto standardisedself-regulation

W3C# Later approval of standards

3 Standardised self-regulation

IETF Formal approval of standards

4 Discussed self-regulation IMCB Prior principled informal discussion, but nosanction/approval/process audit

5 Recognised self-regulation

ISPA Recognition of body ± informal policy role

6 Co-founded self-regulation

FOSI# Prior negotiation of body ± no outcome role

7 Sanctioned self-regulation

PEGI#

Euro mobile

Recognition of body ± formal policy role (contactcommittee/process)

8 Approved self-regulation Hotline# Prior principled less formal discussion with

government ±with recognition/approval

9 Approved compulsory co-regulation

KJM#

ICANN

Prior principled discussion with government ±withsanction/approval/process audit

10 Scrutinised co-regulation NICAM# As 9, with annual budget/process approval

11 Independent body (withstakeholder forum)

ICSTIS# Government imposed and co-regulated withtaxation/compulsory levy



My own work on co-regulation



WWW.ESSEX.AC.UK/EXCCEL@EXCCELESSEX

Questions?

[email protected]



Can we automate regulation? Susskind (2011) The End of Lawyers? Rethinking

the Nature of Legal Services

Many technical disputes involve little law

Experts in markets can arbitrate

Subject to minimal legal standards

BUT possibility of appeal to courts, even

where arbitration is mandated 1st step Recent case: ex parte British Telecom/TalkTalk

Courts decided govt had put costs of future

mandatory arbitration on wrong party

powers devolved to Ofcom in Initial Obligations Code



Delegation of powers to XROs Financial and/or administrative support, and

supporting XRO membership

(e.g. by endorsing XRO-generated standardsfor public procurement or standards evidenceof regulatory compliance).

It would be likely to involve government officials in policy and/or

implementation fora, as with PEGI Online

ICANN model?

Nominet?



Judicial review of XROs? Competition powers and private cartels?

Liability under Human Rights Act 1998?

Campbell v. Mirror Group Newspapers route?

Private bodies performing public functions

Judicial activism required?

China Law Society 2011

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