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- W2040674629 abstract "Scholars of ‘regulatory governance’ promote the view that regulation is not confined to government-based rules and procedures, but constitutes a whole range of activities exercised by both state and non-state actors, either separately or in combination. This paper investigates the role of commercial contracts as instruments of regulatory governance. Various scholars have noted that commercial contracts are increasingly important vehicles for the implementation and enforcement of safety, social and sustainability standards in transnational supply chains. While commercial contracts have traditionally acted as a principal legal vehicle to facilitate the exchange of commodities between individual entities, they are now increasingly being employed as regulatory instruments of entire transnational supply chains. 1 Right from the outset, however, it appears that contract law imposes constraints on the use of commercial contracts as a regulatory device. More specifically, the doctrine of ‘privity of contract’ (relative du contrat) holds that a contract can give rise to rights and duties only for those who are party (‘privy’) to the contract. This implies that, as a rule, firms can bind their contracting parties only and not the other parties that constitute the supply chain (e.g. second or third tier suppliers) and parties positioned outside that chain but with an interest in its proper functioning (e.g. consumers, NGOs, workers and other stakeholders). The logic that underpins regulation by contract therefore differs fundamentally from that which underpins (traditional) forms of regulation: regulation operates on the logic that it is binding on the entire group of regulated entities, while contracts in principle only bind those that have agreed to the contract (i.e. the contracting parties). Based on a literature review, this paper further explores the tension between regulation and contract law by mapping the emergence of commercial contracts as a means to implement and enforce safety, social, and sustainability standards in transnational supply chains. It highlights the scope of this development, identifies its drivers, and discusses the main challenges to governance that arise from it, also in the light of classical contract law doctrine. Accordingly, the paper summarizes the state-of-the-art in the literature on the use of contracts as instru* I thank the other contributors to this Special Issue and the editors for helpful comments and discussions on an earlier draft of this paper. I am also grateful for the suggestions offered by Katerina Peterkovai and Louise Vytopil, who carry out innovative (empirical) research on the private law implications of codes of conduct and private standards. The usual disclaimer applies. 1 See e.g. McBarnet & Kurkchiyan 2007, Vandenbergh 2007, Lin 2009, Cafaggi 2013, Vandenbergh 2013, Peterkova (2014a, 2014b), with further references in each of these sources." @default.
- W2040674629 created "2016-06-24" @default.
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- W2040674629 date "2014-11-01" @default.
- W2040674629 modified "2023-09-23" @default.
- W2040674629 title "Regulatory governance by contract: the rise of regulatory standards in commercial contracts" @default.
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- W2040674629 doi "https://doi.org/10.5553/rdw/138064242014035003005" @default.
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