Showing papers in "Law and contemporary problems in 1972"

Harmonization of European Company Laws

Abstract: May I begin with a statement of confession and avoidance: I am not and never have been an expert in corporation law of any kind-European or American-and I shall therefore avoid any discussion of technical corporation law questions. I am, however, interested in the corporation as an institution that plays a role in the process of integration of states. Arthur S. Miller wrote once that going national by American corporations was one of the principal reasons for the American economy's becoming national, and for the changes in the nature of the federal system that have taken place since I787. Once the economy became national, it meant that a continental economic system was superimposed on what was then a decentralized political order. This released powerful impulses toward centralization in the federal political system. The analogy between the evolution in the United States and that in contemporary Western Europe is alluring, but it is, of course, dangerous as all such analogies are. Yet it is a fact that business in a politically decentralized Europe is going European, that the corporation is the principal instrumentality in this Europeanization process, and that the Common Market Treaty provides an institutional framework for a new economic system and perhaps for a new political order as well. It is proper for us lawyers to realize that the law plays a part in this development as it did in the United States. But it is the better part of wisdom to keep in mind that in this complex process the law plays only the role-to paraphrase George Kennan-of a gentle fertilizer.

Yugoslav Trade with EEC and COMECON Countries

Abstract: In I97I the economic relations with EEC countries were significantly affected by both internal and external factors. During that year the negative trade balance with all of the EEC countries rose steadily, owing to a decrease in Yugoslav exports (to all countries except to the Federal German Republic), and to a considerable increase in imports. This unfavorable development is particularly disconcerting since one of the most dynamic regions of the world is involved-a region which is responsible for approximately 33 per cent of all exports from, and 40 per cent of all imports to, Yugoslavia. In short, the primary importance of the EEC as a market, so far as Yugoslavia is concerned, is that it provides an outlet for a relatively high percentage of Yugoslav exports, and thus is an important source of convertible currency. Such currency is required to settle the negative balance of trade, as well as the balance of payments deficit in general. Not all EEC countries participate equally in trade with Yugoslavia. As has been true in the past, Italy and the Federal German Republic continue to be the most active Yugoslav trade partners, as regards both imports and exports. As indicated in Tables I and II, commodity exchange has been dynamic only with respect to these two, and even here, most activity was on the import side. So far as exports were concerned, an increase over previous years was noted only in deliveries to the West German market.

A Selective Bibliography of East-West Commercial Relations

Abstract: The Bibliography is a selective listing of published materials on East-West commercial relations which have appeared in English or French over the past ten years (January i, 1963 through mid-i973). This is a period in which not only the volume, but also the variety, of East-West business relations have grown rapidly, and these developments are reflected in the increase and diversity of the published works on the subject. Studies prepared by governmental agencies (national and international) as well as by private individuals and groups have been included. Coverage of recent works is more exhaustive. For a more complete listing of earlier works in the field, the reader is referred to several earlier bibliographies:

Recent Developments in East-West Trade: The U.S. Perspective

Abstract: Upon his return from the May, I972, Moscow Summit Conference, President Nixon announced that groundwork had been laid for a comprehensive trade agreement with the Soviet Union. Shortly thereafter in October, I972, the Soviet Union and the United States signed agreements on trade' and on settlement of the former's long-outstanding lend lease debt.2 The new agreements include new understandings between the parties on formerly insurmountable obstacles such as the Soviet repayment of lend lease indebtedness, the extension of reciprocal credits by instrumentalities of each party, the extension of most-favored-nation status to the Soviet Union, and sundry other provisions that have stood in the path of normalized trade relations for two and a half decades. The proposed Trade Reform Act of I973 introduced by the Administration in April, I973, would provide the requisite congressional approval for implementing the trade agreement's provisions concerning the grant of most-favored-nation status and the removal of discriminatory tariffs currently levied upon the importation of Soviet goods.3 Upon approval by Congress, the bill will signal the end of twenty-five years of artificially proscribed commercial relationships between the world's two largest economies. Until very recently, the subject of East-West trade has been evidenced by a great deal of legal writing and very little actual trade. After World War II, the trade policy of the United States with regard to communist countries remained virtually unchanged for more than two decades. During this period the Soviet Union and the countries that comprise the "Soviet bloc" turned to ready markets in Western Europe, Great Britain, Japan, and elsewhere. In recent years, however, due to recurring Soviet crop failures, the United States, as the world's largest producer of grain, has negotiated several large grain sales, but these sporadic shipments can hardly be characterized as an ongoing commercial relationship. The future prospect of a more enduring trade relation has required extensive readjustment of the legal framework in which these new commercial arrangements will be undertaken.

Presidential Spending Discretion and Congressional Controls

Abstract: On the basis of the Constitution and traditional legislative prerogatives, Congress lays claim to exclusive control over the purse. Nevertheless, while it is up to Congress to appropriate funds, it is also true that the President and the executive branch enjoy considerable discredoY as to how those funds are spent. Existing studies tell us how the President formulates the budget and how Congress acts on the budget requests he submits. Surprisingly, we know relatively little about how the money, once appropriated, is actually spent. A notable exception in this field is a work by Lucius Wilmerding, Jr., published three decades ago.1 The purpose of this article is to present a more contemporary account of executive spentding discretion, to show its impact on public policy, and to point to some of the techniques and procedures used by Congress to preserve its power of the purse. Although the President's spending discretion may seem essentially a twentieth century phenomenon, resulting primarily from the Budget and Accounting Act of 1921 it has been a problem since George Washington's first administration. A number of early examples underscore that fact and add historical perspective and balance to this presentation. The material is organized under seven main headings: lump-sum appropriations, covert financing, transfers between classes, reprogramming, transfers in time, impoundment, and unauthorized commitments. Within those broad categories are smaller sections on such topics as contingency funds, military assistance, no-year money, accelerated procurement, and coercive deficiencies. A number of these categories overlap, resulting in a certain arbitrariness in organization.

State Aids, State Monopolies, and Public Enterprises in the Common Market

Abstract: The provisions of the Treaty establishing the European Economic Community (EEC) can be divided into two categories which roughly correspond to the two instruments through which the Community must fulfill its task of promoting "throughout the Community a harmonious development of economic activities, a continuous and balanced expansion, an increased stability, an accelerated raising of the standard of living and closer relations between its Member States."1 These instruments, provided for under Article 2, are (a) the establishment of a Common Market and (b) the progressive approximation of the economic policies of the member states. Part Two of the EEC Treaty ("Bases of the Community") deals with the former and includes provisions relating to the customs union, the agricultural and transport policies, and the freedom of establishment and of movement of workers, services, and capital. Integration of economic policies is to be implemented through the application of the tax provisions, the approximation of legal, economic, and social policies, and related devices as provided in Part Three of the Treaty ("Policy of the Community"). The rules on competition apply to both categories. The establishment of the Common' Market was by far the more simple task. The rules provided for under the EEC Treaty in this field are of a technical nature and rather well defined, and the activities of the European institutions required to implement them constitute lawmaking in the largest sense. It is in unifying the market that the Commun'ity achieved its most spectacular results. Fundamental to the success of the Community in this area is the direction in Article 9(I) of the EEC Treaty that

The Multinational Corporation in the Enlarged European Community

Abstract: To deal constructively with the role of the multinational corporation as affected by the enlarged European Community, one should have a fairly clear idea of just what is meant by a "multinational corporation." There is, however, no general consensus on a working definition of this much-used and poorly understood term.l What is a multinational corporation? Wondrous creatures come to mind, such as the unicorn-the mythical animal with the body and head of a horse, the hind quarters of a stag, the tail of a lion, and a single horn in the middle of the forehead. Another is the hippogriff. Betty Bock, the Conference Board's director of antitrust research, tells us that a hippogriff is part horse and part griffin, and a griffin is part eagle and part lion.2 If a hippogriff is a symbol for a domestic conglomerate, my own imagination falters before the challenging search for a symbol for the multinlational corporation which may also be a conglomerate. A multinational corporation may be (and has been) defined as a corporation holding substantial foreign investment but with a predominant home base; or a corporation with sales abroad about equal to domestic sales; or a corporation that has lost its national identity through wide international ownership.3 Yet another definition rejects the notionr that what is to be defined is the "multinational corporation"; the relevant term is held to be the "multinational enter-

On Davis on Confining, Structuring, and Checking Administrative Discretion

Abstract: In reviewing Davis's Administrative Law Treatise2 a decade earlier, I had thought it a remarkable compilation and evaluation of court cases dealing with administrative agency practices and procedures, as well as the most comprehensive examination of the relationship to administrative law of such central legal concepts as stare decisis, res judicata, estoppel, official notice, ripeness, primary jurisdiction, and exhaustion of remedies.3 Although he recognized that many principles of administrative law, because of confusing or conflicting authorities, could not be asserted with certainty, Davis's objective as author of the Treatise was to make a systematic statement of principles derived from the huge mass of administrative law that had sprung up in recent decades. The data he examined were primarily Supreme Court decisions and lower court opinions that were based on agency rules, adjudications, and practices related to them. Unsurprisingly, the evaluations he made consisted primarily of learned observations and incisive critiques of what the courts had said and done in response to what agerncies had said and done. My principal reservation about the Treatise was that it focused much more on formal law than on administration, more on the delineation of legal principles than on processes of decision-making. As a consequence, little was done to meet the concern of practitioners, administrators, and students about how administrative law develops and functions in reality. To the extent that Davis was then concerned with discretion at all, his emphasis was on judicial rather than on administrative discretion. Even in his examination of institutional decisions, Davis dealt mainly with the formal aspects of administrative problems. He discussed, for example, the extent to which deciding officers must personally consider evidence, the consultation of staff by examiners and agency heads, and the absences of or substitutions for officers and agency heads in decision sessions4 Implicit in his analysis was the view that

Arbitral Tribunals for Foreign Trade in Socialist Countries

Abstract: The beginnings of commercial arbitration in the socialist commonwealth are directly connected with the early Soviet resort to private arbitration in commercial disputes with the capitalist countries.1 While the Soviet Union planned to expand its foreign trade, its judicial system was totally unfit to handle disputes where the law of the market, which the revolutionary state planned to abolish, provided the only valid standard for a decision. The Soviet Union was faced with the necessity either of reforming its laws and judicial system or resorting to some other method of dispute settlement acceptable to foreign traders who, as a matter of principle, were suspicious of the impartiality of Soviet courts. For the solution of its commercial disputes with foreign countries, Russia turned to private arbitration. At no time, however, was the Soviet counterpart of commercial arbitration as practiced in the capitalist world truly private.2 Since the early days of the Soviet state the monopoly of foreign trade had been one of the important instruments of its economic policy. Business organizations established to maintain economic relations with foreign business circles were private only in the sense that they did not aspire to the status of government agencies. While in the capitalist world commercial arbitration was the creation of private interests and business organizations, in the Soviet Union it was the creation of the state.

The Framework of Anglo-Soviet Commercial Relations: The British View

Abstract: The conduct of Anglo-Soviet trade occurs within a legal framework composed of various factors, including treaties, trade agreements, unilateral trade policies and measures employed by both countries, and the substantive law of each state Official agreements between the two states have typically been bilateral accords operating principally to establish a legal structure for trade between the two countries1 The modest function of such instruments is to authorize the conduct of trade, leaving to the market mechanism or, as in the case of the Soviet Union, central planning, the actual content of the trade In addition, each government promulgates trade measures independent of transnational trade agreements and these measures have potential effects upon Anglo-Soviet commercial relations For example, Britain enforces a prohibition of certain strategic goods to the USSR and employs an export licensing system which may affect commerce between the two states2 Another component of the framework is the substantive law of both states It is generally the case in English law that corporations which are agencies of a state under their respective charters or constitutions are accorded state immunity The view that an enterprise can be so constituted as to enjoy the privilege of state immunity was articulated in the case of Krajina v Tass Agency,3 which will be explored below The historical foundation of English practice toward state trading enterprises can be traced to cases involving the East India Company4 In early cases in which the company was sued, courts typically dismissed the actions on the ground of the sovereign status of the company, despite the fact that it was primarily engaged in commercial activities Sovereign action, occurring subsequent to and resulting from certain commercial arrangements was found, for example, in Nabob of the Carnatic v East India Co5 In that case, the defendant-company had been assigned certain

Antitrust in the Common Market: Innovation and Surprise

Abstract: In 1957, an improbable and in fact revolutionary event took place in Western Europe. Six sovereign countries, by treaty, transferred control over large sectors of their industrial economy to a supranational institution, the Europear Economic Community. Among the most surprising provisions of the Rome Treaty establishing this Common Market were Articles 85 and 86,1 which are directed, roughly speaking, at the same restrictive business practices as are covered by section i of the Sherman Act of i89o, section 3 of the Clayton Act of 1914, and the Robinson-Patman Act of 1936. Article 85(i) and (2) of the Rome Treaty brand as illegal all agreements, decisions, and concerted practices of enterprises which are apt to affect commerce among the six member states of the Common Market and have as their object or effect the prevention, restriction, or adulteration of competition within the Market. Among the practices specifically enumerated in the Article are horizontal or vertical pricefixing; the limitation or control of production, distribution, technical development, and investment; the dividing of markets or sources of supply; tie-in sales; full-line forcing; and discriminatory prices or other sales conditions. This is all encompassing and sophisticated language. Restrictive practices are to be adjudged mainly on the basis of their actual and potential effect on competition; the intent of the parties is of only secondary significance. The prohibition applies to \"all concerted practices\" of enterprises and \"decisions\" of associations, which necessarily cover tacit agreements or gentlemen's understandings and may cover more. It is also conceded by the commentators that these prohibitions may apply to business activities that are primarily confined to a single country provided they have an effect on trade among member states. Provision' is made in Article 85(3) for granting exemptions for business restrictions \"which contribute to the improvement of the production or distribution of commodities or to the promotion of technological or economic progress.\" However, this broad exemption is qualified by three safeguards: that the restrictive arrangement result in some benefit to consumers, that it not be more restrictive than is necessary

The System of Trade Between Japan and the East European Countries, Including the Soviet Union

Abstract: Poor in natural resources, Japan has long been dependent on overseas supply for most of her raw material and fuel requirements. While imports of raw materials and fuel by the United States and West Germany in I970 accounted respectively for I4 per cent and 22 per cent of their total imports, Japan's imports of raw materials and fuel in the same year amounted to about 59 per cent of her total imports. In addition, Japan depends on imports from foreign countries for Ioo per cent of her wool, raw cotton, and nickel; 98 per cent of her petroleum; 95 per cent of her iron ores; and 55 per cent of her industrial coal. Such being the case, one of the guiding principles in Japan's foreign trade policy has been to expand trade with any country, regardless of its political system. Japan was plagued by a gap between her economic growth and her international balance of payments until the mid-Ig60's and, in order to improve this situation, promotion of exports was given highest priority. Thus, efforts have been made to expand trade with the Soviet Union and East European countries on a commercial basis. After the resumption of private foreign trade in 1949, trade between Japan and the Soviet Union and East European countries was conducted at a low level for some time. However, since the conclusion of a treaty of commerce and an agreement on trade and payment with the Soviet Union in 1957, and the conclusion of treaties of commerce with Poland and Czechoslovakia in 1958 and I959, Japan's trade with Eastern Europe has increased yearly. In I970, the total of Japanese trade with this area broke the $i billion mark ($822 million in trade with the Soviet Union, and $218 million in trade with East European countries). However, these figures account for only 2.2 per cent and 0.6 per cent respectively of Japan's total world trade in 1970. Compared to the figures for Japanese trade with the United Kingdom and West Germany-$I.5 billion and $3.6 billion respectively-they are still at a relatively low level.

The United States, the European Community, and Prospects for a New World Economic Order

Abstract: In December, I97i, at the Smithsonian Institution in' Washington, the United States, the major governments of Western Europe, Canada, and Japan set the stage for a basic reform of the postwar monetary and trade arrangements established in the Internationtal Monetary Fund and the General Agreement on Tariffs and Trade (GATT). The Fund and the GATT, twin instruments of the "world of Bretton Woods," have until now provided the foundation of the liberal economic policies which have contributed greatly to the enormous growth of trade and investment amoig the countries of the Western world and which have brought their economies to a state of intense interdependence. The Smithsonian Agreement was the product of crisis rather than of advance planning and deliberative action. The crisis was generated by the sudden and spectacular increase in the balance-of-payments deficit of the United States in early I97I. This was followed by the New Economic Policy of the Nixon Administration in August which, along with the establishment of wage and price controls at home, abandoned the convertibility of the dollar into monetary gold. For good measure, the United States unilaterally imposed a punitive ten per cent surcharge on imports plus an internal tax discrimination against foreign goods as bargaining weapons to force foreign governments into an appreciation of their exchange rates. These blows shook the world trade and monetary system to its foundations. The framework of the world of Bretton Woods, despite its past successes and despite frequent repairs over the years, was clearly unable to cope with the new situation. The immediate accomplishments of the Smithsonian Agreement were three:

Marxism-Leninism and Soviet-American Economic Relations Since Stalin

Abstract: In the original Marxian scheme, governments were the product of the fundamental employer-employee relationships within the society. Supposedly in the capitalist system the primary relationship was one of exploitation and oppression imposed upon the worker by the employer through private ownership of the means of production. The economic enterprise was the institutionalization of that relationship, and according to Lenin, capitalist production was to be identified as a mainstay of imperialism. Hence, for the Soviet ideologue, post-Stalinist economic relations with capitalist business raise grave ideological obstacles. The official party line emphasizes the socialist duty to undermine the capitalist structure and denies basic doctrinal support for Soviet trade and cooperation with imperialist circles. Communist doctrine stipulates that Soviet foreign policy must bring about the world socialist revolution through concerted action against the United States. This is to be manifested in the avoidance of wide-scale cooperation with the United States and its monopolies and in economic competition leading to the "economic defeat" of the imperialist system. The "camp theory" and the doctrine of imperialism theoretically prohibit anything but the most rudimentary commerce between the Soviet and capitalist blocs. Under these theories, the continued existence of imperialism is based on the availability of new markets, resources, and investment opportunities for capitalist enterprise. If allegiance to ideology is to be preserved, the Soviet Union should not contribute to the well-being of this exploitive system by providing new areas for imperialist economic expansion, except under exigent circumstances. How can this view be reconciled with the ever-expanding trade relations between the U.S. and the U.S.S.R.? A critical matter in the ideological framework is the manner in which the confrontation with capitalism is effectuated. The party theorists now accept that competition must be the prime characteristic of Soviet foreign economic policy, and that the United States and the Soviet Union must be the chief competitors. According to the Soviets,

The Law of Foreign Trade in the People’s Republic of Bulgaria

Abstract: A. Establishment of the Foreign Trade Monopoly Prior to the advent of the present government on September 9, I944, the export of Bulgarian products and the import of foreign goods were primarily within the sphere of private activity and were carried on by commercial firms and organizations. In accordance with the legal framework then in existence, individual citizens had the right freely to engage in commercial activities and, in particular, to engage in transactions involving foreign trade with freedom to form foreign trade organizations as well. Any interference by the government was confined to measures aimed at regulating and supporting the export-import activity of these commercial enterprises. After the establishment of the present government and in the course of its consolidation, the foreign trade of the country underwent profound changes. The Bulgarian legislation in this field was mainly the result of the change in the form of government. As is well known, during the final stages of World War II, as a result of Soviet military occupation and political influence and the coup d'etat of September 9, 1944, Bulgaria was politically, economically, and socially reorganized into a people's democracy. All measures directed to the reorganization purportedly sprang from an economic philosophy based on the establishment of a governmentplanned economy and the nationalization of the economy, as well as from a sociallegal theory patterned after that subscribed to by the Soviet Union. Along this line foreign trade was declared a government monopoly as an inseparable part of state sovereignty. All this has been gradually achieved by virtue of a series of legislative enactments and administrative measures aimed at abolishing all private initiative and all private organizations engaged in foreign trade activities. Thus, at the early stage of development, to use the words of Petko Stainov, professor of law at Sofia University, "the government monopoly of foreign trade was established on the basis of the legislation in effect taken in its entirety."' According to Stainov, the explanation for the establishment of a government monopoly of foreign trade is that "[conducting the] foreign trade relations of the People's Republic of Bulgaria