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88 N.C. L. Rev. 501 (2009-2010)
On the Use and Abuse of Standards for Law: Global Governance and Offshore Financial Centers

handle is hein.journals/nclr88 and id is 509 raw text is: ON THE USE AND ABUSE OF STANDARDS FOR LAW: GLOBAL GOVERNANCE AND OFFSHORE FINANCIAL CENTERS* RICHARD K. GORDON** Current trends in international legal scholarship have shifted from a paradigm of state actors working within recognized sources of international law to one that includes networks of domestic regulators that develop and implement best practices or standards on a global basis. The new paradigm can be seen in operation in the efforts by onshore jurisdictions (most of which are financial centers themselves) to restrict the activities of offshore financial centers. Onshore jurisdictions enlisted these regulatory networks, as well as key international organizations, such as the Organisation for Economic Co-operation and Development and the International Monetary Fund, to advance new standards for income taxation, prudential regulation, and money laundering in offshore centers. By 2005, offshore centers' compliance with financial, regulatory, and money laundering standards was largely complete, while there was less success with income tax standards. The current financial crisis, however, has spurred renewed efforts, particularly with respect to the latter. An analysis of this experience suggests that the new paradigm should view regulatory networks in the context of a complex system of states and international organizations that possess the qualities of such regulatory networks. A system of global governance that includes both regulatory networks and these international organizations advances fairness and objectivity and, in * © 2010 Richard K. Gordon. ** Associate Professor of Law, Case Western Reserve University School of Law; Adjunct Professor of International Studies, Brown University. B.A. Yale (1978). J.D. Harvard Law School (1984). From 1994 through 2003, the author served as a senior staff member at the International Monetary Fund (IMF) and worked on each of the substantive issues discussed in this Article. While the author has taken great pains not to use any confidential information in writing the Article, he does on occasion refer to non- confidential discussions among IMF Executive Directors, management, and staff, as well as government officials dealing with the IMF. Occasionally, this includes direct quotes that the author has not attributed to a specific source so as to avoid any possible adverse repercussions. Much information concerning the nature and activities of organizations discussed in this Article is derived from the personal experiences of the author. Nothing in this Article should be taken as representing the official views of the IMF or anyone involved in formulating the policies discussed. Thanks to Rebecca Cage, Jonathan Adler, Craig Boise, Peter Gerhart, Jacqui Lipton, David Kennedy, and Andy Morris.

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