Transnational Regulatory Networks and Their Limits
Since the end of World War II, ambitious institutions and regimes have emerged to regulate international economic life. The General Agreement on Tariffs and Trade (GATT) provided multilateral legal guidelines for governing trade restraints; the World Trade Organization (WTO), as the new incarnation of the GATT's original institutions, has extended its jurisdiction to encompass intellectual property and services.' The International Monetary Fund (IMF) initially wielded extensive authority over the international monetary system and, though its mission has been in flux since the 1970s, retains a leading role in the international financial system. Alongside these global regimes, numerous regional and bilateral treaties pursue greater trade liberalization and investment protection. Other treaty regimes control trade in specific goods such as nuclear materials, weapons, and cultural property.
Despite these developments, economic regulation in crucial areas such as competition, securities, and banking remains first and foremost a domestic phenomenon. The first major attempt to set up a global competition regime failed in 1947 with the Havana Charter, as have periodic attempts to resuscitate the idea. Transnational securities transactions are subject to overlapping and sometimes contradictory national laws. Likewise, national regulators, not global authorities, supervise internationally active banks. In the absence of international treaties and institutions, national regulators have created informal networks to exchange ideas, coordinate their enforcement efforts, and negotiate common standards. Thus, the Basel Committee on Banking Supervision promotes cooperation in bank regulation and supervision; the International Organization of Securities Commissions (IOSCO) coordinates international securities regulation and enforcement; and the International Competition Network (ICN) fosters policy convergence among antitrust authorities.