Law and Development in East and South-East Asia

During the 1980s and 1990s Asian 'developmental states' attracted much attention in political science and economics literature, but the role of law in the economic development was neglected. It was only after the Asian crisis of 1997 that many analysts began to focus on a lack of regulation and transparency as a major factor triggering the crisis. The crucial questions now are how successful the current reforms will be, and which features of the Asian approach to commercial law will be resistant to reform pressures. This book examines the prospects for commercial law reform in Asia, giving particular attention to Japan and Singapore, as frequently cited role models for Asian developmentalism, and also examining development related business laws in countries such as China, Korea, Indonesia, Malaysia, Vietnam and the Philippines

Foreign investment law in Central and Eastern Europe

One of the most remarkable developments in Central and Eastern Europe (CEE) has been the region's opening to foreign direct investment. CEE states saw foreign investment climb from minuscule amounts in 1989 to more than $7 billion in 1992. All CEE states have enacted new laws on foreign investment as well as related legislation in areas such as taxation and company and environmental law. The authors describe these efforts at legal reform and assess their impact on foreign investment in light of what is known about investor motivation. They concentrate on the role of foreign investment law, referring occasionally to other aspects of law that apply to domestic and foreign investors. They find that specialized foreign investment laws can play a useful role during the transition to a market economy. Of particular importance is their role in sending a strong signal to foreign entrepreneurs that the host country is serious about economic reform and is willing to work with investors to establish mutually beneficial arrangements. Foreign investment laws are also often used to target special incentives to foreigners and create an island of legal development that may differ from -- and sometimes outpace -- other legal development. In such ways they tend to create investment"enclaves."But to the extent that an enclave separates foreign from domestic investors, it can quickly outlive its usefulness. The incentives it fosters may not only bleed domestic treasuries, but may also lead to bureaucratic structures that complicate the investment environment and elevate information and transaction costs for foreign investors. As quickly as possible, the transforming economies should dismantle the enclave and put domestic and foreign investors on an equal footing. This may well mean that foreign investment laws are no longer needed. The Czech and Slovak Federal Republic was the first CEE country to abolish specific foreign investment legislation in favor of a broad commercial code covering all investors. If an enclave does exist, policymakers should focus on the concerns critical to foreign firms. In the design of investment laws to date, the CEE countries have perhaps paid too much attention to preferential tax schemes, ignoring other costs foreign investors face. Policymakers should focus on reducing uncertainty and transaction costs through clear and simple legislation, contract enforcement, arbitration and other alternative dispute resolution mechanisms, stronger protection of property rights, dissemination of information on laws and on business opportunities, and an end to unnecessary bureaucratic intervention. Complex regulations not only increase investor uncertainty but divert bureaucratic resources that the host country cannot afford to squander.Environmental Economics&Policies,Legal Products,National Governance,International Terrorism&Counterterrorism,Trade and Regional Integration

Consumers, the legal system and product liability reform: A comparative perspective between Japan and the United States

A new Product Liability (PL) Act in Japan became effective in July, 1995. In the United States, congress passed, subject to the endorsement of the president, the legislation that limits the ceiling of compensations and punitive damages in PL cases. Thus, there seems to be a converging tendency between the Japanese system, which has relative emphasis on industrial interests and encouraged off-court settlements, and the U.S. system, which has relatively emphasized consumers' interest and encouraged litigation. A large difference exists between the United States and Japan, particularly in the number of suits about product liability. For example, within a half year after the enforcement of the new PL Act, only a single case was brought to court in Japan. This paper explains the legal content, the social background and the legislation process of the new PL Act in Japan. Using economic analysis, it clarifies the question of what the consequences are with the difference in legal systems on resource allocation in the two countries

Law and Development in East and South-East Asia

During the 1980s and 1990s Asian 'developmental states' attracted much attention in political science and economics literature, but the role of law in the economic development was neglected. It was only after the Asian crisis of 1997 that many analysts began to focus on a lack of regulation and transparency as a major factor triggering the crisis. The crucial questions now are how successful the current reforms will be, and which features of the Asian approach to commercial law will be resistant to reform pressures. This book examines the prospects for commercial law reform in Asia, giving particular attention to Japan and Singapore, as frequently cited role models for Asian developmentalism, and also examining development related business laws in countries such as China, Korea, Indonesia, Malaysia, Vietnam and the Philippines