Informal international lawmaking: elaboration and implementation in The Netherlands Besselink, L.F.M.

Transcription

1 UvA-DARE (Digital Academic Repository) Informal international lawmaking: elaboration and implementation in The Netherlands Besselink, L.F.M. Published in: Informal international lawmaking: case studies Link to publication Citation for published version (APA): Besselink, L. F. M. (2012). Informal international lawmaking: elaboration and implementation in The Netherlands. In A. Berman, S. Duquet, J. Pauwelyn, R. A. Wessel, & J. Wouters (Eds.), Informal international lawmaking: case studies (pp ). (Law of the future series; No. 3). The Hague: Torkel Opsahl Academic EPublisher. General rights It is not permitted to download or to forward/distribute the text or part of it without the consent of the author(s) and/or copyright holder(s), other than for strictly personal, individual use, unless the work is under an open content license (like Creative Commons). Disclaimer/Complaints regulations If you believe that digital publication of certain material infringes any of your rights or (privacy) interests, please let the Library know, stating your reasons. In case of a legitimate complaint, the Library will make the material inaccessible and/or remove it from the website. Please Ask the Library: or a letter to: Library of the University of Amsterdam, Secretariat, Singel 425, 1012 WP Amsterdam, The Netherlands. You will be contacted as soon as possible. UvA-DARE is a service provided by the library of the University of Amsterdam ( Download date: 05 Dec 2017

2 Law of the Future Series Informal International Lawmaking: Case Studies Ayelet Berman, Sanderijn Duquet, Joost Pauwelyn, Ramses A. Wessel and Jan Wouters (editors)

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4 Informal International Lawmaking: Case Studies Ayelet Berman, Sanderijn Duquet, Joost Pauwelyn, Ramses A. Wessel and Jan Wouters (editors) 2012 Torkel Opsahl Academic EPublisher The Hague

5 This and other books in the Law of the Future Series may be openly accessed and downloaded from This site uses Persistent URLs (PURL) for all publications it makes available. Printed copies may be ordered through online distributors such as This book was first published on 24 December Torkel Opsahl Academic EPublisher, 2012 All rights are reserved. You may read, print or download this book or any part of it from for personal use, but you may not in any way charge for its use by others, directly or by reproducing it, storing it in a retrieval system, transmitting it, or utilizing it in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, in whole or in part, without the prior permission in writing of the copyright holder. Enquiries concerning reproduction outside the scope of the above should be sent to the copyright holder. You must not circulate this book in any other cover and you must impose the same condition on any acquirer. You must not make this book or any part of it available on the Internet by any other URL than that on ISBN

6 PUBLICATION SERIES PREFACE The Hague Institute for the Internationalisation of Law (HiiL) and the Torkel Opsahl Academic EPublisher (TOAEP) are pleased to include Informal International Lawmaking in the Law of the Future Series established in October HiiL an independent research and advisory institute is the driving force behind this Publication Series, which aims at promoting futureoriented research in the field of law. Thanks to the close cooperation with TOAEP, it is possible to bring such innovative research to persons anywhere in the world who may be interested in it, using an online platform that is open and freely accessible to all. The Law of the Future Series is premised on the assumption that prospective thinking about law and justice systems is not only desirable but also necessary, in order to ensure that they do not become obsolete, ineffective or unjust. The Series primarily features compilations of think pieces about the law of the future and the future of law, but also includes other publications. The first book in the Series brought together trends from different areas of law. The second book explores what you do with those trends: how does one get to strategise? Both used the same method: that of think pieces by thought and practice leaders in different areas. This volume critically assesses the dangers inherent within informal international lawmaking concerning its accountability, transparency, and effectiveness. As will be the case with all future volumes in the Law of the Future Series, this book can be freely read, printed or downloaded from It can also be purchased through online distributors such as as a regular printed book. Firmly committed to open access, neither TOAEP nor HiiL will charge for this book. Questions and comments are welcomed and may be transmitted via toaep@fichl.org. Sam uller, arry at Backer and Stavros ouridis Publication Series Co-Editors i

7 ABBREVIATIONS 3G or GGG ABAC ABTC ACASH ACS ACT AFM AGCARM AHC AHI AHWP AMWG ANVISA ANZFA APEC APIs APVMA ASEAN ASEAN PPWG AU BACEN BCBS BIAC BIS BMC BPNI ii Global Governance Group APEC Business Advisory Council APEC business travel card Association for Consumers Action on Safety and Health (India) Andean Community Secretariat (Andean Committee for the Defense of Competition) Anti-Corruption and Transparency Experts Task Force (APEC) Stichting Autoriteit Financiële Markten (Authority for Financial Markets, Netherlands) Association for Animal Health and Crop Protection (New Zealand) APEC's Harmonization Centre (APEC) Animal Health Institute (United States) Asian Harmonization Working Party Asset Management Working Group (UNEP) National Health Surveillance Agency (Brazil) Australia and New Zealand Food Authority Asia Pacific Economic Cooperation Active pharmaceuticals ingredients Australian Pesticides and Veterinary Medicines Authority Association of the South East Asian Nations Association of Southeast Asian Nations Pharmaceutical Product Working Group African Union Banco Central do Brasil (Central Bank of Brazil) Basel Committee on Banking Supervision Business and Industry Advisory Council (OECD) Bank of International Settlements Budget and Management Committee (APEC) Breastfeeding Promotion Network (India)

8 BTR Breaking the Rules-report (IBFAN) CAC Codex Alimentarius Commission CAD Company Affairs Directorate (OECD) CAHI Canada Animal Health Institute CDS Credit default swaps CEN European Committee for Standardization CIC China Investment Corporation CMN Conselho Monetário Nacional (National Monetary Council, Brazil) COMIECO Council of Ministers of Economy of Central America CSWB Central Social Welfare Board (India) CTD Common technical document CTI Committee on Trade and Investment (APEC) CVM Comissão de Valores Mobiliários (Securities and Exchange Commission, Brazil) DDA Doha Development Agenda (WTO) DG Directorate-General (EU) DG Director-General (EU) DNB De Nederlandsche Bank NV (Central Bank, Netherlands) DRAs Drug regulatory authorities DRC Democratic Republic of the Congo DRR Disaster risk reduction EAC East African Community EB Executive board EC European Commission (EU) EC DG SANCO Directorate General for Health and Consumers (EU) EC FVO Food and Veterinary Office (EU) ECGI European Corporate Governance Institute ECN European Competition Network (EU) ectd Electronic common technical document EFPIA European Federation of Pharmaceutical Industries Associations EFSA European Food Safety Authority (EU) EMA European Medicines Agency (EU) EMDCs Emerging markets and developing countries iii

9 ESG Environmental, social and corporate governance EU European Union FAO Food and Agriculture Organization (UN) FATF Financial Action Task Force FDA Food and Drug Administration (United States) FDI Foreign direct investment FMR Financial market regulation FOPREL Forum of Presidents of Legislative Branches in Central America and the Caribbean FSANZ Food Standards Australia-New Zealand Agency FSAP Financial Sector Assessment Program (IMF World Bank) FSB Financial Stability Board FSF Financial Stability Forum FTA Free trade agreement GAL Global administrative law GATT General Agreement on Tariff and Trade (WTO) GC Global Compact (UN) GCC Cooperation Council of Arab States of the Gulf GCC-DR Gulf Central Committee for Drug Registration (GCC) GCG Global Cooperation Group (ICH) GCGF Global Corporate Governance Forum (OECD World Bank GCP Good clinical practice G-FMR Global financial market regulation GFSI Global Food Safety Initiative GHS Globally Harmonized System of Classification and Labeling of Chemicals (UN) GHTF/IMDFR Global Harmonization Task Force/International Medical Devices Regulators Forum GLOBALG.A.P. Global Partnership for Good Agricultural Practice GMDN Global Medical Device Nomenclature GMOs Genetically modified organisms GNDR Global Network for Disaster Reduction GPEG Government Procurement Experts Group (APEC) G-SIFI Global systemically-important financial institutions iv

10 HFA HiiL HTF IADB IAP IASB IBEF IBFAN ICCW ICDC ICGN ICH IEC IFAH IFAH Europe IFIs IFPMA IFSWF IGE IGPA ILO IMDRF IMF IMFC IMS INDECI INDECOPI INFACT INFOSAN IN-LAW Hyogo Framework for Action (UNISDR) The Hague Institute for the Internationalization of Law Health Task Force (APEC) Inter-American Development Bank Individual action plan (APEC) International Accounting Standards Board Brazilian Institute of Finance Executives International Baby Food Action Network Indian Council for Child Welfare International Code of Marketing of Breastmilk Substitutes Documentation Centre (IBFAN) International Corporate Governance Network International Conference on the Harmonization of Technical Requirements for Registration of Pharmaceuticals for Human Use International Electrotechnical Commission International Federation of Animal Health European Federation for Animal Health International financial institutions International Federation of Pharmaceutical Manufacturers and Associations International Forum of SWFs Intergovernmental Group of Experts (UNCTAD) International Generic Pharmaceutics Alliance International Labour Organization International Medical Device Regulators Forum International Monetary Fund International Monetary and Finance Committee (IMF) Infant Milk Substitutes, Feeding Bottles and Infant Foods Act (India) National Institute of Civil Defence (India) National Institute for the Defense of Competition and Intellectual Property Protection (Peru) Infant Formula Action Coalition (United States) International Food Safety Authorities Network (WHO) Informal international lawmaking v

11 IOs International organizations IOSCO International Organization of Securities Commissions IPEG Intellectual Property Rights Experts Group (APE ) IPR Implementing rules and regulations ISDA International Swaps and Derivatives Association ISDR International Strategy for Disaster Reduction (UN) ISO International Organization for Standardization ISSBs International standard-setting bodies IWGSWF International Working Group of Sovereign Wealth Funds JMHLW Japanese Ministry of Health, Labor and Welfare JPDMA Japanese Pharmaceuticals and Medical Devices Agency JPMA Japanese Pharmaceutical Manufacturers Association JVPA Japanese Veterinary Products Association KP Kimberley Process Certification Scheme LAHWP Latin American Harmonization Working Party MDGs Millennium Development Goals (UN) Mercosur Common Market of the South MNCs Multi-national corporations NAFTA North American Free Trade Agreement NDCC National Disaster Coordinating Council (The Philippines) NDRRMC National Disaster Risk Reduction and Management Council (The Philippines) NEN Nederlands Normalisatie-instituut (Normalisation Institute of the Netherlands) NEPAD New Partnership for Africa s Development (AU) NGOs Nongovernmental organizations NMPB National Movement for the Promotion of Breastfeeding (The Philippines) NPs National Platforms for Disaster Risk Reduction NZFSA New Zealand Food Safety Authority OAA Osaka Action Agenda (APEC) OECD Organisation for Economic Cooperation and Development vi

12 OIE OTC OUP PAHO PANDHR PFA PhRMA PRIA PRIAC RASFF RHIs RTA SADC SAICM SCE SEC SICA SIECA SINADECI SOE SOM SPS SRI SWF Swissmedic TBT TFEP TPR TPRM World Animal Health Organization Over the counter Oxford University Press Pan American Health Organization Pan American Network on Drug Regulatory Harmonization Prevention of Food Adulteration Act (India) Pharmaceutical Research and Manufacturers Association of America Principles for Responsible Investment Association (UN) Principles for Responsible Investment Advisory Council (UN) Rapid Alert System for Food and Feed (EU) Regional harmonization initiatives Regional trade agreement South African Development Community Strategic Approach to International Chemical Management (UN) Senior Officials Meeting (SOM) Steering Committee on Economic and Technical Cooperation (APEC) Securities and Exchange Commission (United States) Central American Integration System Central American Economic Integration Subsystem National System for Civil Defence (Peru) State-owned enterprise Senior Officials Meeting (APEC) Sanitary and Phytosanitary Measures Agreement (WTO) Sustainable and responsible investment Sovereign wealth fund Swiss Agency for Therapeutic Products Technical Barriers to Trade Agreement (WTO) Task Force for Emergency Preparedness (APEC) Transnational private regulation Trade policy review mechanism vii

13 TRSN TUAC UK UN UNCTAD UNEP FI UNEP UNICEF UNISDR UNPRI or PRI UNSG US USKPA VHAI VICH WHA WHO WSMI WTO Transnational regulatory safety net Trade Union Advisory Council (OECD) United Kingdom United Nations United Nations Conference on Trade and Development United Nations Environment Programme Finance Initiative United Nations Environment Programme United Nations Children's Fund United Nations International Strategy for Disaster Reduction Secretariat United Nations Principles for Responsible Investment United Nations Secretary-General United States of America United States Kimberley Process Authority Voluntary Health Association of India International Cooperation on Harmonization of Technical Requirements for Registration of Veterinary Medicinal Products World Health Assembly World Health Organization World Self-Medication Industry World Trade Organization viii

14 TABLE OF CONTENTS Publication Series Preface... i Abbreviations... ii Introduction and Key Issues Surrounding Informal International Lawmaking... 1 By Ayelet Berman, Sanderijn Duquet, Joost Pauwelyn, Ramses A. Wessel and Jan Wouters 1. The Rise of Informal International Lawmaking and Accountability Concerns The IN-LAW Project The Methodological Framework of IN-LAW The Definition of Informal International Lawmaking The Definition of Accountability Relation Between this Book and the OUP Informal International Lawmaking Book Case Study Selection Structure of the Book Carrying the Debate Further PART I: REGIONAL AND COUNTRY SPECIFIC CASE STUDIES 1. The G20 and Informal International Lawmaking By Jan Wouters and Dylan Geraets 1.1. Introduction The Concept of Informal International Lawmaking Origins and Evolution of the G Functioning and Policymaking Process of G G20 Output Accountability and Effectiveness Accountability, Legitimacy, Responsiveness and Inclusiveness ix

15 Accountability at the International Level Accountability at the Domestic Level Towards Inclusiveness and Responsiveness G20: Legitimate Global Governance Effectiveness Concluding Remarks Informal International Lawmaking in East Asia An Examination of APEC By Takao Suami x 2.1. Introduction Overview of APEC Birth of APEC APE s Activities and embership Trade and Investment Liberalization Expansion of APE s Activities and Membership APE s Organizational Structure and Decision-Making Process Multilevel Meetings Economic eaders eeting and Ministerial Meeting Other Types of Meetings and the APEC Secretariat APEC Business Advisory Council (ABAC) APEC Decision-Making APEC and Legal Measures APEC and International Organizations APEC and Legal Obligations The Notion of IN-LAW and APEC Informality Output Informality Process Informality Actor Informality International Lawmaking Informal Lawmaking in APEC: APEC Guidelines, Principles, Codes and Model Measures Overview... 67

16 Trade and Investment Liberalization Mobility of Business Persons Free Trade Agreements and Regional Trade Agreements APE s Best Practice Model Measures for RTAs/FTAs Rules of Origin Trade in Services and Investment Non-Binding Investment Principles Menu of Options for Liberalization Principles on Services Trade Chemical Regulation Intellectual Property Competition and Regulatory Reform Government Procurement Non-Economic Subjects Anti-Corruption Emergency Preparedness Fishery Environmental Protection Public Health APEC Informal Instruments and their Impact upon APE embers Domestic aw Issues Relating to APEC IN-LAW Positive Examples of APEC IN-LAW ABTC Scheme Model RTAs/FTAs Measures Model Measures and Previous RTAs/FTAs Model Measures and Subsequent RTAs/FTAs Negative Examples of APEC IN-LAW Doubt About APEC IN-LAW APEC IN-LAW and Domestic Laws in the Context of Peer Review Peer Review and Informal International Instruments xi

17 Individual Country Peer Review Reports Australia and Japan Informal Instruments as Reference Points Other Instruments Not Mentioned in Peer Reviews Overall Analysis of APEC Informal Instruments Introductory Remarks Practical Difficulty to Monitor General, Abstract, Modest and Allowing Exceptions Reliance on International Rules APEC and Accountability Deficit Transparency in APEC ABTC Scheme Model Measures on RTAs/FTAs Other Informal Instruments Concluding Remark: The Notion of IN-LAW Informal International Lawmaking: Elaboration and Implementation in the Netherlands By Leonard F.M. Besselink 3.1. Introduction Informal International Law in Domestic Law: In Search of Elements of Fit Functional Governance Ways in Which International Decisional Output Enters the National Legal Order: Formal International Law and Domestic Constitutional Arrangements Informal International Decision-Making in the National Legal Order The Netherlands: Monism, Openness to the International Order and the Evolutionary Constitution Output of Informal International Decision-Making: Some Findings Concerning the Financial Sector The Basel Committee on Banking Supervision, the Netherlands Central Bank and Accountability xii

18 International Organization of Securities Commissions (IOSCO) and the Stichting Autoriteit Financiële Markten (AFM) Input Legitimacy and Accountability Legal Basis National and European Legislation Upward Internal Accountability: The IMF FSAP-Program Downwards Political Accountability at the National Level Multiple Forms of Implementation and Application Some Other Forms of Accountability: Liability for Standard Setting and Legal Accountability on the Basis of Standards International Accounting Standards Board (IASB) Conclusions and Epilogue Some Conclusions An Epilogue on Accountability and De-Constitutionalization Informal International Lawmaking and Accountability in Brazil By Salem H. Nasser and Ana Mara França Machado 4.1. Introduction Brazilian Rules on the Conclusion of International Agreements and on the Incorporation of International Law Formal International Law Informal Outputs Basel Committee on Banking Supervision (BCBS) Overview of the Brazilian Financial System Background to Brazil Joining the Basel Committee on Banking Supervision Brazil s Reliance on Basel Standards Prior to and Since Membership Accountability Mechanisms An Assessment of the Accountability and Legitimacy of Banking Regulation International Organization of Securities Commissions (IOSCO) xiii

19 Overview of the Brazilian Securities Market and Domestic Legal Framework for Rule Elaboration Membership and Level of Involvement Implementation of IOS O s Outputs Accountability Mechanisms International Conference on Harmonization of Technical Requirements for Registration of Pharmaceuticals for Human Use (ICH) Overview and Legal Framework Brazil s Participation in the I H Implementation of ICH Guidelines Accountability Mechanisms General Conclusions PART II: FINANCE AND COMPETITION 5. Informal International Lawmaking: Global Financial Market Regulation By Shawn Donnelly 5.1. Introduction Institutional Development and Reform Institutional Features and Obligation Informal International Lawmaking in Financial Market Regulation Banking Securities Corporate Governance Combating Illicit International Financial Transactions Systemic Risk Accountability Conclusion xiv

20 6. Financial Markets, Regulatory Failures and Transnational Regulatory Safety Nets: The Building of a Policy-Making Metaphor By Maciej Konrad Borowicz 6.1. Introduction Thinking in Transnational Regulatory Safety Nets TRSNs and the Concepts and Questions in the IN-LAW and TPR Framework Finding Common Ground Informal International Law-Making and Transnational Private Regulation: Complements or Alternatives? Accountability Effectiveness TPR, IN-LAW and Global Administrative Law (GAL) TPR and Financial Markets: The International Swaps and Derivatives Association The International Swaps and Derivatives Association (ISDA) and the ISDA Master Agreement ISDA and Its Regulatory Failure: Accountability and Effectiveness IN-LAW and Financial Markets: Basel II The Basel Committee on Banking Supervision BCBS and Its Regulatory Failure: Accountability and Effectiveness TRSNs and Financial Markets: The Building of a Policy-Making Metaphor Interfaces in Terms of Norm Production, Monitoring and Enforcement Interfaces in Terms of Accountability and Effectiveness TRSNs and Courts TRSN, Central Counterparties and Trade Repositories Conclusions xv

21 7. The Informality of the International Forum of Sovereign Wealth Funds and the Santiago Principles: A Conscious Choice or a Necessity? By Eliza Malathouni 7.1. Introduction Sovereign Wealth Funds Defining Sovereign Wealth Funds Concerns Related to Sovereign Wealth Funds Economic Concerns Political Concerns Dealing with these Concerns The Road Towards the IWGSWF and the IFSWF IWGSWF IFSWF The IN-LAW Framework and Its Application to the IFSWF IN-LAW Process IN-LAW Actors IN-LAW Output The Content of the Santiago Principles on Accountability and Transparency Internal Private Accountability Internal Public Accountability External Private Accountability External Public Accountability Experiences from the Application of the Santiago Principles Findings of the Report Internal Private Accountability Internal Public Accountability External Private Accountability External Public Accountability Transparency Identification and Evaluation of Lacunas Concluding Remarks xvi

22 8. The United Nations Principles for Responsible Investment from an IN-LAW Perspective By Megan Smith 8.1. Introduction The History and Structure of PRI The Principles Before 2006: Lead-Up to and Motivations for PRI s Founding Governance Structure Membership Funding Output and Activities Strategic Development Implementation Support Implementation and Compliance Accountability Responsiveness Inside PRI: During Their Elaboration Responsiveness Inside PRI: In Their Implementation Responsiveness to External Stakeholders Challenges for All Involved Conclusion Can Accountability and Effectiveness Go Hand in Hand? Lessons from Two Latin American Competition Networks By Pierre M. Horna 9.1. Introduction The IN-LAW Methodological Framework Introduction Do The entral American Group and The Andean ommittee Fall Under the Working Definition of IN-LAW? Critical Assessment of Both Networks Assessing the Degree of Accountability Through the Four IN-LAW Approaches The Case of the Central American Group Accountability to Whom? Functions of Accountability xvii

23 xviii Mechanisms of Accountability Timeline of Accountability The Case of the Andean Committee Accountability to Whom? Functions of Accountability Mechanisms of Accountability Timeline of Accountability Assessing the Level of Effectiveness in the Central American Group and the Andean Committee Relatively Good Levels of Effectiveness and the Impact of the Central American Group Does Cooperation Materialize? Does it Stick? Does it Solve the Problem? Does it Solve the Problem in a Cost-Effective Way? Lack of Effectiveness and Impact of the Andean Committee Since 2005: Identifying the Four Dimensions of Network Effectiveness Does Cooperation Materialize? Does it Stick? Does it Solve the Problem? Does it Solve the Problem in a Cost-Effective Way? Promising Developments Handling Confidential Information Affects Both the Accountability and Effectiveness of Networks: When the Learning Dimension of Accountability May Offer an Opportunity Timing: Formal Cooperation Implemented Too Early in the Andean Committee The Division of abor between Formal and Informal Networks Topics for Further Research on How to Improve the Level of Sharing Information When Dealing with the Issue of Confidentiality Lessons Learned and Recommendations For the Central American Group

24 For the Andean Committee PART III: HEALTH, FOOD AND SOCIAL STANDARDS 10. Informal International Lawmaking in Medical Products Regulation By Ayelet Berman Introduction International Conference on the Harmonization of Technical Requirements for Registration of Pharmaceuticals for Human Use Background Legal Framework Members Other Participants Observers Interested Parties Governance Structure Steering Committee Working Groups Guideline Drafting Procedure The Content of the Guidelines Globalization and the Expansion of Participation The Global Cooperation Group Regulators Forum Adoption of Guidelines The International Cooperation on Harmonization of Technical Requirements for Registration of Veterinary Medicinal Products Background Legal Framework Members Other Participants Associate Members: The World Animal Health Organization Observer Members Interested Party Governance Structure Steering Committee xix

25 Expert Working Groups Secretariat Guideline Drafting Procedure The Content of the Guidelines Globalization and Expansion of Participation Adoption of Guidelines The Global Harmonization Task Force / The International Medical Device Regulators Forum Background Legal Framework Members Other Participants Governance Structure Steering Committee / Management Committee Study Groups / Ad Hoc Groups Secretariat Guideline Drafting Procedure The Content of the Guidelines Globalization and Expansion of Participation Adoption of Guidelines Conclusion Food Safety Standards and Informal International Lawmaking By Sanderijn Duquet and Dylan Geraets xx Introduction The Concept of Informal International Lawmaking Setting Food Safety Standards in a Multi-Actor Context Actors with a Public Character Bilateral Food Standard-Setting Regional Food Standard-Setting MERCOSUR European Union Global Food Safety Standard-Setting The Codex Alimentarius Commission World Health Organization Actors with a Private Character International Organization for Standardization (ISO)

26 Global Partnership for Good Agricultural Practice (GLOBALG.A.P.) Global Food Safety Initiative (GFSI) Coexistence of the Various Actors The Use of Informal International Law in Food Safety Standard-Setting Concluding Remarks The Domestic Effectiveness of the International Code of Marketing of Breastmilk Substitutes By Ina Verzivolli Introduction International Effectiveness of the Code as IN-LAW The Birth of the Code: International Awareness and the Problem with Artificial Feeding Introduction The 1979 Meeting WHA - First and Second Draft WHA - The Third and Fourth Drafts The International Informal Lawmaking Status of the Code Informality as a Compromise International Accountability Mechanisms Effectiveness at the Domestic Level Implementation at Domestic Level The Strength of National Measures Defining Domestic Effectiveness Monitoring Domestic Implementation and Compliance with the Code Monitoring of State Action and Corporate Compliance by IBFAN Case Study Selection The Malaysia Case Study The Philippines Case Study The India Case Study Determinants of Effectiveness Strong is More Effective Civil Society, Industry and Accountability Conclusion xxi

27 13. Effectiveness and Accountability of Disaster Risk Reduction Practices: An Analysis through the Lens of IN-LAW By Luca Corredig Introduction: A Strategy and a Framework for Disaster Risk Reduction Evaluating Effectiveness Policies, Platforms and Laws Four Interesting Cases Assessing Accountability Conclusion Informal International Lawmaking: The Kimberley Process Mechanism of Accountability By Victoria Vidal The Kimberley Process Certification Scheme The Creation of the Kimberley Process The IN-LAW Status of the Kimberley Process Certification Scheme The Functioning of the Kimberley Process The Accountability of the Kimberley Process Certification Scheme The Internal Accountability of the Kimberley Process The External Accountability of the Kimberley Process The Functioning of the Kimberley Process Conclusion and Recommendations Index Torkel Opsahl Academic EPublisher Also in the Law of the Future Series xxii

28 3 3Informal International Lawmaking: Elaboration and Implementation in the Netherlands 3.1. Introduction Leonard F.M. Besselink Informality is the hallmark of present-day globalization. Formal distinctions such as those between public and private are not decisive if we are to capture the nature of globalization. Actor informality, process informality and output informality epitomize globalization. Informal international lawmaking as defined in the IN-LAW project is, then, essentially a phenomenon of globalization. In turn, it is in the nature of globalization that it takes place in a space in which the strict dichotomy between domestic and international has largely broken down. 1 As many authors have submitted, international law no longer takes its primary effect in international 1 Leonard F.M. Besselink is Professor of European Constitutional Law at the University of Utrecht. This paper was finalised while H.G. Schermers Fellow of The Hague Institute for the Internationalisation of Law (HiiL) at the Netherlands Institute for Advanced Studies (NIAS). This chapter began as a conceptual paper on constitutional parameters of the status of informal decision-making output in national legal systems, which was discussed at an IN-LAW research group meeting at Geneva, June 2010; next, it was discussed in a version focusing more on aspects of implementation and effects in domestic law, discussed at the IN-LAW group meeting at the NIAS in March The author is grateful to the participants and the editors of these volumes for their remarks and input. Special thanks are owed to Owen Neuteboom, who provided important research assistance, as well as doing most of the fieldwork on implementation of IOSCO standards in the Netherlands, and drafted sections on IOSCO in this chapter. Nico Krisch and Benedict Kingsbury, Introduction: Global Governance and Global Administrative Law in the International egal Order, in European Journal of International Law, 2006, vol. 17, issue 1, p. 1. Law of the Future Series No. 3 (2012) page 97

29 Informal International Lawmaking: Case Studies relations but aims at effectiveness within the domestic legal order. 2 International law s objective is increasingly its realization within the domestic legal order, and its effect is increasingly located within the national legal orders. The global is local, as the saying goes, hence the importance of examining the manners in which informal international lawmaking takes effect in the domestic legal order. This chapter focuses on the status and implementation of the output of informal international lawmaking in the Netherlands, and looks at the manner in which certain types of informal international lawmaking in the field of the financial sector are implemented from the perspective of its consequences for accountability both in a broad social sense ( responsiveness ), as well as in a political and legal sense. 3 It looks at the constitutional explanations and implications this has. The choice for the Netherlands is explained by the fact that it is a country with a typically monistic system as regards the relation between international law and national law, while it is also an EU Member State, which can have an impact on implementation. An initial hypothesis researched within the overall project was whether in monist countries, the reception of the products of informal international lawmaking would be different from and presumably easier than in dualist countries. This chapter corroborates the hypothesis that the Netherlands easily takes on board the relevant output within the legal system. This, however, is not due so 2 Jean-Bernard Auby, Globalisation et droit comparé, in European Journal of Law, 2006, p. 48 : Si l'on y regarde bien, on découvre que c'est de plus en plus au travers du droit interne que les normes internationales - en croissance, certes -, produisent leurs incidences. Ce qui est déterminant, c'est le fait que, notamment au travers des mécanismes d'effet direct, les normes internationales viennent trouver dans le sein des mécanismes juridiques nationaux - et notamment des mécanismes judiciaires- les ressorts d'une efficacité qu'elles ont bien du mal à trouver au niveau international. [ ]Si l'on regarde bien, on observe que ce droit international dont le poids se fait de plus en plus sentir dans le droit interne, a une tendance croissante à s'éloigner des préoccupations internationales pour s'intéresser de plus en plus abondamment à des questions internes ; Jean-Bernard Auby, Is legal globalisation regulated? Memling and the business of baking camels, in Utrecht Law Review, 2008, vol. 4, issue 3; Paul Schiff Berman, From International Law to Law and Globalization, in Columbia Journal of Transnational Law, 2005, vol. 43, pp See Joost Pauwelyn, Informal International Lawmaking: Framing the Concept and Research Questions, in Joost Pauwelyn, Ramses A. Wessel, Jan Wouters (eds.), Informal International Lawmaking, Oxford University Press, Oxford, 2012, pp Law of the Future Series No. 3 (2012) page 98

30 Informal International Lawmaking: Elaboration and Implementation in the Netherlands much to its monist system as such. In the course of the research undertaken for this chapter, moreover, it emerged that other factors may provide more crucial clues to explaining the manner in which and the degree to which informal international law is part of the legally relevant sources in domestic practice. Apart from certain elements specific to the relevant informal international law output, broader explanations are found in the constitutional culture of the country which creates the fit between informal international lawmaking and the domestic order. We shall find that classic constitutional institutions of democracy and accountability are used to a limited extent to oversee the entrance of informal international law into the domestic setting, but almost necessarily these are quite limited and seem to that extent eclipsed by others. If this is true and can be generalized, it would mean that, instead of the widely propagated constitutionalization thesis, international law is in a sense de-constitutionalized in the framework of informal international law. In this case study of the Netherlands, we limit ourselves, as far as the empirical material is concerned, to how output in the financial sector as produced by the Basel Committee on Banking Supervision and by the International Organisation of Securities Commissions (IOSCO), including both IOSCO Principles and the standards produced by the International Accounting Standards Board (IASB) fared. 4 The structure of this chapter is determined as follows. The topic of giving effect to the output of informal international lawmaking in the do- 4 On the financial sector and these organisations in particular, see Chapter 5 by Shawn Donnelly, Informal International Lawmaking: Global Financial Market Regulation, On the Basel Committee ; see Pierre Hugues Verdier, U.S. Implementation of Basel II: Lessons for Informal International Lawmaking, in Joost Pauwelyn, Ramses A. Wessel, Jan Wouters (eds.), Informal International Lawmaking Oxford University Press, Oxford, 2012, pp ; David Zaring, Informal Procedure, Hard and Soft, in International Administration, in Chicago Journal of International Law, 2005, vol. 5, p. 547; Michael S. Barr and Geoffrey P. Miller, Global Administrative Law: The View from Basel, in European Journal of International Law, 2006, vol. 17, no. 1, pp The IASB is briefly introduced and further literature provided on by Maurizia De Bellis, International Accounting Standard Setting and the IASC Foundation, in Sabino Cassese, Bruno Carotti, Lorenzo Casini, Marco Macchia, Euan Mac- Donald, Mario Savino (eds.), Global Administrative Law: Cases, Materials, Issues, 2008, Institute for International Law and Justice, pp. 9 15, and De Bellis, Global Private Standards and Public Law: The EU Approach to Accounting Harmonization, ibid. pp Law of the Future Series No. 3 (2012) page 99

31 Informal International Lawmaking: Case Studies mestic legal order is essentially about determining the fit (or misfit ) between the two. This necessitates us first to describe aspects of both the relevant international lawmaking and of the relevant domestic legal order which could provide that fit. Next, we examine how some of the output of the financial sector institutions mentioned is endorsed within the Netherlands legal order. On the basis of this analysis we draw some conclusions on the parameters of the domestic effects of informal international lawmaking. We next return to the issue of accountability and democratic legitimacy which has been haunting the informality of international lawmaking Informal International Law in Domestic Law: In Search of Elements of Fit It is not easy to say anything meaningful about the legal status of a phenomenon which precisely because of its intended informality also intends to escape from having any formal legal status. The output informality of the decision-making of organizations and networks with which this book is concerned, makes determination of its legal status problematic. Fortunately, what is informal in one context can become formal in another. It is at this crossing point from informality to formality, from non-status to status, that we are to examine issues of accountability and legitimacy in this chapter. In doing so, we must examine the manner in which a fit exists or is lacking between the informal nature of the output and the particular legal order in which it is received, implemented and elaborated. Highlighting some general characteristics of informal lawmaking and the correspondent characteristics of the domestic system, which provide a potential fit, should clear the path to studying more concretely the manner in which particular forms of informal international law enter the domestic legal order with its attendant forms of accountability Functional Governance One crucial aspect of nearly all informal international lawmaking is that it constitutes a form of functional governance as opposed to territorial political government. States, however, are territorially based political communities. Its purpose and objective is not a specific functional interest but the general interest, which in turn is conceived as a political category in terms of the relevant territorial entity. Functional forms of government Law of the Future Series No. 3 (2012) page 100

32 Informal International Lawmaking: Elaboration and Implementation in the Netherlands within the state can be quite controversial and often sit uneasily with traditional, territorially organized representative democracy. Functionally organized government within the state is easily associated with forms of corporatism, neo-corporatism or consociationalism, which are often criticized for their potential of undermining the general interest formulated on the basis of political democracy. From the point of view of a territorially organized political democracy, the specificity of functional interests can be legitimately served only to the extent that these can be aggregated into a perceived general interest as determined by that territorially organized political community. Most Western states have succeeded in doing so, because functional governance has existed within all such state legal orders, though to quite different degrees. Recognizing that most forms of informal international decisionmaking are forms of functional governance can explain some of the questions and issues that arise concerning legitimacy and accountability, as these stem particularly from the national constitutional frames of thought rooted in territorial political communities Ways in Which International Decisional Output Enters the National Legal Order: Formal International Law and Domestic Constitutional Arrangements Our frame of thought as to the manner in which informal international lawmaking acquires effect in the domestic legal order, takes its starting point in the traditional manner in which formal international law does so. This should make it possible to examine how informal law compares to these methods. Of the various forms of classic international law, the categories of treaties and decisions of (formal) international organizations under public international law are next of kin to informal international lawmaking as defined in this project. We focus on these in this section. As concerns national constitutional systems on how international law enters the domestic legal order, treaties are the traditional form of international decision-making and in this matter precise rules and practices have existed at least since the 19 th century. Constitutions link treaties to legislation and take their alleged legislative nature as the benchmark for the national procedures which allow treaties into the national legal order. Law of the Future Series No. 3 (2012) page 101

33 Informal International Lawmaking: Case Studies This has determined the accountability framework for the incorporation of treaties into the national setting. From the international law perspective, treaties are as far as the legal nature of the international obligations is concerned which they engender outside the sovereign remit of each of the single parties; they exist inter-subjectively between the parties to the treaty. 5 But as to their conclusion, they must be viewed as the product of governments: they are classically concluded by government representatives. 6 Besides the similitude of a treaty to legislation, this is the other reason for subjecting this form of decision-making to parliamentary oversight. To the extent that national constitutional treaties consider treaty obligations equivalent to legislation, they require specific parliamentary approval; and to the extent that they do not, governments act in this regard under general supervisory and accountability rules of a parliamentary systems, such as the general concept of ministerial responsibility. 7 A caveat is in place regarding the concept of a treaty. When use is made of instruments which create legal obligations not having formal treaty status under national law, these may still be for all intents and purposes treaties under international law. 8 These may take the form of executive, governmental, ministerial international agreements, memoranda of understanding and so forth. Even though they are treaties under public international law, in most countries these agreements do not require parliamentary approval under national law. Instead they may need a form of governmental approval, typically by the council of ministers, but See International Court of Justice, Case concerning Maritime Delimitation and Territorial Questions between Qatar and Bahrain, ICJ Reports 1994, 14 at para. 27; Jan Klabbers, The Concept of Treaty in International Law, The Hague, Kluwer, Article 7 of the Vienna Convention on the Law of Treaties. We are here speaking in broadly comparative terms. This is not to deny that in some countries treaties which are not legislative in terms of binding citizens, affect their rights or impose obligations on state entities in the internal legal order. Thus, we shall see that in the Netherlands in principle all treaties (in the sense of public international law) require parliamentary approval. Moreover, in non-parliamentary systems of government, matters within the constitutional remit of the executive are usually excluded from parliamentary oversight, as is typically the case for presidential powers in the USA. See Jan Klabbers, Impact of Informal International Law before International Courts and Tribunals, in Joost Pauwelyn, Ramses A. Wessel, Jan Wouters (eds.), Informal International Lawmaking, Oxford University Press, Oxford, 2012, pp Law of the Future Series No. 3 (2012) page 102