International Trade Law Commons^™

The Conundrum Of Industrial Policy: Incompatibility With The Rules Of International Trade Law, Yong-Shik Lee

Northwestern Journal of International Law & Business

Since the end of World War II, successful developing countries such as South Korea, Taiwan, Singapore, and, more recently China, have leveraged industrial policies—notably trade measures and subsidies—to achieve economic development. However, these industrial policy tools often conflict with the rules of international trade established under the World Trade Organization (WTO law), which aims to minimize government interference and reduce trade distortions. Paradoxically, such regulatory constraints hinder the development aspirations of many countries. Meanwhile, major global economies, including the United States, China, and the European Union, have revived industrial policies to support their key industries, such as semiconductors and electric …

Louboutin Lawfare: Exploring Conceptions Of Sanctions' Utility Through Export Controls On Luxury Goods, Vinita R. Singh

Northwestern University Law Review

There is widespread consensus amongst scholars that sanctions—the deliberate withdrawal of customary trade and financial relations—do not work. Despite this perception, states are deploying sanctions at an increasing rate. This Article explains this paradox by arguing the predominant notion of sanctions’ utility employed by scholars is unduly constrained, narrowly focusing on the ability of such measures to modify the behavior of sanctioned parties while disregarding the alternative benefits this instrument can deliver. To support this argument, this Article uses export controls on luxury goods deployed in connection with the Russo–Ukraine War as a case study. Under prevailing perceptions of sanctions’ …

On Blockchain As A Tool Against Corporate Corruption, Yannis Normand

Northwestern Journal of International Law & Business

Over the last decades domestic and international legal frameworks have successfully coalesced to limit corrupt behavior worldwide. However, despite their success, current regulatory tools are not sufficiently well-equipped to address corruption in modern economic settings. These mechanisms can often be too costly to implement, too cumbersome to induce compliance, politically manipulatable, and may disincentivize foreign investment and internal corporate monitoring efforts. To address such drawbacks, policymakers should consider the introduction of blockchain-based tools in developing future anti-corruption efforts.

Blockchain can serve as a foundation for structures that can make it more attractive, easier and cost-efficient to monitor economic transactions, to …

The War On Trade: Applying The Wto Security Exceptions To Economic Security Measures, Ian Allen

Northwestern Journal of International Law & Business

This article examines the efficacy of the WTO treaties’ security exception provisions in curbing abusive appeals to national security to justify otherwise impermissible trade measures. It specifically explores whether GATT Article XXI and its sister provisions establish objectively discernible prerequisite conditions for their invocation, how far Member discretion extends in defining “essential security interests,” and whether the WTO dispute system offers sufficiently objective legal standards to prevent abuse of the security exceptions.

Building on existing scholarship, this article employs a comprehensive interpretive analysis of all available means under the Vienna Convention on the Law of Treaties (VCLT) and integrates not …

The Clash Of Security And Commerce: Analyzing The Impact Of U.S. Foreign Trade And Investment Regulations Through The Lens Of The Tiktok Controversy, Xuemao Zhang

Northwestern Journal of International Law & Business

This Article examines the evolving tension between national security and economic globalization in U.S. foreign trade and investment regulation. Using the TikTok controversy as a focal point, it argues that American trade regulation has undergone a decisive transformation—from promoting international integration to prioritizing the protection of strategic technologies, data, and supply chains against perceived adversaries, particularly China. The analysis traces this shift from early tariff legislation, through the liberalizing trade era of the mid-twentieth century, to recent measures such as the Foreign Investment Risk Review Modernization Act of 2018 and President Biden’s executive orders on inbound and outbound investment. The …

“There Is No Fashion On A Dead Planet:”1 How A Mandatory Reporting Directive Shared By The Us And The Eu And Centered On Transparency Could Be The First Step To Increased Sustainability In The Fashion Industry, Adrienne Redman

Northwestern Journal of International Law & Business

The fashion industry hangs on self-expression and individualism, yet our methods of consumption and their resulting environmental impacts are far from an individualistic concern. This paper examines the global fashion industry’s substantial contribution to pollution, resource-depletion, and waste as evidence that the self-regulation model is insufficient to curb the environmental footprint of the industry. Self-regulation presumes that consumer awareness and the desire to purchase sustainably will be enough to limit the industry’s environmental impact. However, this presumption is undermined by a lack of standardized and enforceable regulations necessary for consumer-decision making. Instead, greenwashing and deceptive environmental claims have pervaded the …

The Failings Of Post-War Japanese Antitrust Reforms, Gregory Hayes

Northwestern Journal of International Law & Business

This paper discusses the antitrust reform measures taken during the occupation of Japan following the end of World War II. These antitrust reforms included the dissolution of the zaibatsu business groups and the adoption of the Antimonopoly Act. However, the trust-busting and antitrust measures taken by Japan failed to prevent the eventual rise of keiretsu business groups and lower the concentration of corporate ownership in Japan. The primary reasons behind this failure were the inability of the reformers to fully dismantle the zaibatsu business groups and the changing priorities of the reformers due to the growing threat of the spread …

The Goldilocks Dilemma In Terminating Treaties: The Case Study Of Brexit And Trade, Catherine Fabiano

Northwestern Journal of International Law & Business

Treaties are an essential source of international law, and they are permitted to be terminated. The rules governing termination, namely the 1969 Vienna Convention on the Law of Treaties, highlight two main goals of treaties: the stability and flexibility of agreements. Brexit highlights these goals and illustrates the tensions that arise. When parties terminate their treaties, they are ultimately stuck in a goldilocks dilemma. Essentially, the parties have to balance a combination of factors to achieve just the right outcome. The United Kingdom and the European Union were caught in this goldilocks dilemma which Brexit depicts. In the end, the …

Non-State Actors For Profit: Revisiting Transnational Corporations' Personhood And Responsibility Under International Law, Katayoon Beshkardana, Faraz Shahlaei

Northwestern Journal of International Law & Business

The growing impact of Transnational Corporations (TCs) on international trade, investment, and human rights raises the question of international corporate responsibility. For international responsibility, TCs must be recognized as subjects of international law with legal personality. Apart from states as the primary subjects of international law, such status has been granted to inter-governmental organizations (IGOs). The factors that contributed to the IGOs’ recognition as international law subjects seem to be present for TCs today. While the International Court of Justice granted such legal status to IGOs, for TCs, the best path to recognition would be to establish a global authority …

Enforcement Penalties At The Itc, Andrea R. Hugill, John C. Jarosz, Katherine D. Cappaert

Northwestern Journal of International Law & Business

The U.S. International Trade Commission (“ITC” or “Commission”) has grown in importance as a venue for U.S. companies to pursue intellectual property (“IP”) violators and to block the sale or importation of goods from overseas that infringe U.S. IP rights. Once a violation of the Section 337 of the Tariff Act of 1930 is found, an order halting further infringement, including importation, is almost always entered. In theory, potentially sizeable penalties may be imposed on entities that do not comply with the terms of an import restriction. In practice, the terms of an import restriction are almost always honored, but …

Friendly Skies, Unfriendly Terms: Class Action Waivers And Force Majeure Clauses In Airline Contracts Of Carriage, Grant Glazebrook

Northwestern Journal of International Law & Business

The airline contract of carriage. These unassuming bits of language govern the relationship between passengers and their airlines. Over the past three years, a new term has sprouted in these agreements: the class action waiver. Before March 2020, only two of the ten largest United States-based airlines’ contracts of carriage had class action waivers. But as of April 2023, eight now have class action waivers. Why have airlines quickly adopted these copycat terms? What are the implications of this new contractual trend for flyers, airlines, and regulators? This note aims to contribute to the scholarship around these questions in three …

The Effect Of The Pro Act On Secondary Activity And International Trade, Christopher R. Rodenbaugh

Northwestern Journal of International Law & Business

No abstract provided.

Trends In China-Africa Economic Relations And Dispute Settlement, Won Kidane

Northwestern Journal of International Law & Business

The rapid rise in the last two decades of China-Africa economic interactions in trade, investment, construction projects, and loans require sustained inquiry into the substantive rules of engagement and mechanisms of dispute settlement. Evidently, however, it would quickly emerge that the improvements in supranational legal frameworks have not kept pace with the growing scale and complexity of the economic interactions. While trade relations between China and Africa are theoretically subject to the same multilateral World Trade Organization (WTO) rules, they are in practice mostly based on informal unilateral concessions. Moreover, investment relations are partially governed by fragmented and mostly outdated …

Private Equity And Venture Capital In Germany: How Europe’S Heartland Is Poised To Become The Next Bay Area, Jake Besanceney

Northwestern Journal of International Law & Business

Abstract

This note examines the current state of private equity and venture capital activity and investment in Germany, and specifically in Berlin, in relation to the state of such activity and investment that existed in the San Francisco Bay Area prior to and following its tech explosion in the late twentieth century. Numerous factors such as political and ethnic diversity, a comparatively lower cost of living, and proximity to higher education institutes are propelling Berlin’s startup and tech scenes, and are eerily reminiscent of similar factors that fueled the Bay Area’s growth and attracted private equity and venture capital activity …

Unraveling The Longstanding Riddle About The Doctrine Of Legitimate Expectation Under International Investment Law: Ascertaining Legal Tests For The Customary International Law’S Minimum Standard Of Treatment, Haneul Jung, Nu Ri Jung

Northwestern Journal of International Law & Business

In 2018, the ICJ rendered a judgment in Bolivia v. Chile that effectively denied the status of the doctrine of legitimate expectation as a customary international law. The ICJ’s judgment came as a surprise to many in the international arbitration community because a whole host of international tribunals established under various investment treaties have found that this doctrine, as well as the broader principle of “fair and equitable treatment,” has effectively attained the status as the “minimum standard of treatment” under customary international law. Given the lack of elaborated reasoning, however, the ICJ’s ruling fails to resolve the recurring debate …

The Disaster Chain: Counter-Mapping Global Value Chains, Peer Zumbansen

Northwestern Journal of International Law & Business

Abstract: Prevailing accounts by consultancies and logistics scholars present global value chains [GVCs] as an expression of contemporary international economic integration and connectivity. As such, they are considered crucial to the pursuit of economic growth and prosperity. At the same time, GVCs are deemed susceptible to “disruptions” through natural catastrophes, restrictive trade policies or pandemics. Left out of the standard narratives, even in light of the experience of the global Coronavirus pandemic, is the actual, as such disruptive impact of global value chain capitalism on human and natural lives. Dominant depictions of global value chain governance treat labor, environment and …

Protection Of Test Data Under Article 39.3 Of The Trips Agreement: Advancements And Challenges After 25+ Years Of Interpretation And Application, Eric M. Solovy

Northwestern Journal of International Law & Business

Among the types of intellectual property rights covered by the TRIPS Agreement, WTO Members must, pursuant to Article 39.3, protect certain test and other data submitted “as a condition of approving the marketing of pharmaceutical or of agricultural chemical products.” Such protection provides the incentives necessary for the biopharmaceutical industry to conduct the lengthy, expensive multi-phased clinical testing that is required to demonstrate the safety and effectiveness of a new drug or vaccine.

Test data protection has become increasingly more important to the development of new medicines in the past several years. That is in significant part because biologics (i.e., …

Bridging Separate Worlds— Application Of Human Rights Law In Investment Treaty Arbitration, Raymond Yang Gao

Northwestern Journal of International Law & Business

With the proliferation of investor-state treaty arbitration, international investment law has been increasingly caught in a “legitimacy” crisis, with concerns looming large over resultant disruptive effects on human rights. Amid existing scholarship seeking to recalibrate the balance between investment protection and public interests, what is relatively undertheorized is a public international law dimension. In this regard, this Article explores the role of human rights law in integrating human rights considerations into investment tribunals’ decision-making, bridging the normative divide between international investment law and human rights. It makes three contributions. First, it systemizes the normative tensions and potential conflicts between international …

The Efficient Breach Theory In International Investment Law, Sangwani Patrick Ng’Ambi

Northwestern Journal of International Law & Business

When a State unilaterally abrogates its contractual obligations, it is under a duty to compensate the investor. The aim of the compensation regime under International Investment Law is to restore the investor to a position he or she would have been in had the breach not taken place. Thus, the award of compensation should not only include sunk costs (damnum emergens) but also lost future profits (lucrum cessans).

In this article it is argued that the rules relating to compensation promote efficiency, as per the ‘efficient breach theory’ because they dissuade governments from unilaterally abrogating concession agreements, unless they can …

Between Backlash And The Re-Emerging “Calvo Doctrine”: Investor-State Dispute Settlement In An Era Of Socialism, Protectionism, And Nationalism, Ylli Dautaj

Northwestern Journal of International Law & Business

The Investor-State Dispute Settlement (ISDS) regime stands on shaky ground. Its legitimacy is heavily questioned by critics and a “backlash debate” has ensued. As a result, a contested and infected debate has been on-going for some years now and multiple reform proposals have been offered, ranging from (a) moderate (and sensible) reform proposals—e.g., increased transparency; the inclusion of state counterclaims; the inclusion of higher ethical standards; reformulating deference standards; applying human rights and environmental law when interpreting international investment treaties; etc.—to more (b) radical reform proposals—e.g., the elaboration of either an Appellate System or an Investment Court System (ICS). Such …

Forget Bit: The Impact Of Rta On Fdi And Economic Growth – A Comparison Of Brazil And Mexico, Rosa Meguerian-Faria

Northwestern Journal of International Law & Business

This article explores the relationship between international trade law, foreign direct investment (FDI), and economic growth of developing countries. Here, I argue that a developing state needs to capture the right combination of the different types of FDI to promote domestic growth. I apply principles of law, economics, and finance to my analysis of the importance of Bilateral Investment Treaties (BITs), compared to Regional Trade Agreements (RTAs) to FDI inflow, and how it can impact economic growth in developing countries. I show that the RTAs give a signal that the country is open to foreign investment, and therefore it promotes …

The Indian Securities Fraud Class Action: Is Class Arbitration The Answer?, Brian T. Fitzpatrick, Randall S. Thomas

Northwestern Journal of International Law & Business

Abstract:

In 2013, India enacted one of the most robust private enforcement regimes for securities fraud violations in the world. Unlike in most other countries, Indian shareholders can now initiate securities fraud lawsuits on their own, represent all other defrauded shareholders unless those shareholders affirmatively opt out, and collect money damages for the entire class. The only thing missing is a better financing mechanism: unlike the United States, Canada, and Australia, India does not permit contingency fees, so class action lawyers cannot front the costs of litigation in exchange for collecting a percentage of what they recover. On the other …

Establishing Economic Independence In Haiti Through Public-Private Partnerships And Foreign Direct Investment, Jasmine Armand

Northwestern Journal of International Law & Business

In 1804, the Caribbean island of Haiti became the first black republic in the world after leading the only successful slave rebellion in history to result in the formation of an independent nation. Overflowing with valuable natural resources and equipped with a strategic Caribbean location, Haiti was positioned to remain one of the most prosperous territories in the world. But the price of independence was steep, and the country failed to thrive under crushing foreign intervention. But its story does not end there.

This note examines the opportunities for Haiti to establish economic independence through public-private partnerships and foreign direct …

Alibaba, Amazon, And Counterfeiting In The Age Of The Internet, Daniel C.K. Chow

Northwestern Journal of International Law & Business

The advent of e-commerce marketplaces such as Alibaba and Amazon in the new millennium has led to the proliferation of the sale of counterfeit goods around the world through the Internet. Brand owners find that Internet counterfeiters operating in the digital world present even more challenges than those using only brick-and-mortar operations. Internet counterfeiters have unprecedented access to consumers. They use false identities and addresses and vanish into cyberspace at the first sign of trouble. Brand owners seeking help from Alibaba and Amazon to remove listings of counterfeits have become frustrated by their convoluted and labyrinthine notice and take-down procedures. …

Do You Accept These Cookies? How The General Data Protection Regulation Keeps Consumer Information Safe, Jayne Chorpash

Northwestern Journal of International Law & Business

Abstract:

This note examines the General Data Protection Regulation implemented in the EU in 2018. The GDPR was the result of a long history of data privacy laws that have been met with varying levels of success. While the GDPR has retained many characteristics that have made past privacy laws successful, it has also made some important changes. Most notably, the GDPR gives generous rights to consumers to guard and protect their data, which is of growing concern in light of how easy it is to share information in our modern age. Additionally, the GDPR has a much broader territorial …

A New Development In Private Equity: The Rise And Progression Of Special Purpose Acquisition Companies In Europe And Asia, Brandon Schumacher

Northwestern Journal of International Law & Business

This comment presents a comparative study of Special Purpose Acquisition Companies (SPAC) in the international context and the United States. In the course of examining international SPACs, it is necessary to first discuss and analyze the history and development of private equity and how SPACs became established players in the domestic and international markets. This comment will examine the impact that these short-term investment devices have had for investors, SPAC management, and private companies. The paper will evaluate the perceived advantages and disadvantages of using a SPAC as an acquisition form, as well as reflect on potential future developments pertaining …

Can Smart Contracts Enhance Firm Efficiency In Emerging Markets?, Kevin J. Fandl

Northwestern Journal of International Law & Business

Blockchain technology has the potential to eliminate one of the most significant barriers to economic growth through private business transactions in developing countries—lack of trust. In a typical developed country, individuals and firms conduct transactions within an institutional environment that offers security through the enforcement of agreements. Transparent and effective courts, while imperfect to be sure, enable parties to feel secure in their transactions even if their level of trust in the other party is low. This security, in turn, facilitates transactions far afield from high-trust relationships (e.g., immediate relatives), generating transactions based upon economic value rather than party trust …

How Countries Seek To Strengthen Anti-Money Laundering Laws In Response To The Panama Papers, And The Ethical Implications Of Incentivizing Whistleblowers, Carmina Franchesca S. Del Mundo

Northwestern Journal of International Law & Business

The Panama Papers is currently the world’s largest whistleblower case that involved 11.5 million leaked documents and over 214,000 offshore entities. It all linked back to one Panamanian law firm, Mossack Fonseca. In 2016, over 400 investigative journalists collaboratively and simultaneously published stories that exposed the money laundering and tax-evading schemes committed by the rich and powerful. This included political figures and heads of states, celebrities, sports figures, criminal organizations, and terrorist groups.

This article aims to dissect the innerworkings of Mossack Fonseca’s asset-shielding strategy and investigate how the Panamanian law firm was able to circumvent the tax and anti-money …

The Next Global Disruptive Innovation: Can Mobile Money Make The Journey Upmarket To Disrupt The Financial Services Industry?, David Myerson

Northwestern Journal of International Law & Business

No abstract provided.

Investor-State Dispute Settlement In The Digital Economy: The Case For Structured Proportionality, Robert Ginsburg

Northwestern Journal of International Law & Business

The surge of economic nationalism and cross-border technology investments foreshadows disputes between inbound investors and host governments. While cross-border technology transfer is essential for economic development in many countries, host governments retain the right to safeguard citizens against potential consequences of such investments. The tension between these two concepts provides a significant challenge to the future of foreign direct investment and the global economy. For these reasons, legislators and arbitrators must develop and enforce regulations that protect public interests while enabling investors to successfully operate in the host country. In anticipation of these disputes, this article will explain how arbitral …