This invitational workshop brought together leading experts from academia, intergovernmental organisations and industry to discuss the analysis and quantification of economic benefits (whether micro, macro, or developmental) of international commercial law reform (ICLR). The workshop provided an opportunity to further the discussion of the need for a set of international principles for assessing economic benefits in the context of ICLR.
There was much discussion on the comprehensive formula which is being developed by the project, which will serve as the framework for conducting economic analysis (EA). It was agreed that an annotated version of the general formula will be prepared. This will comprise an explanation and discussion of all the terms, and describe how to calculate metrics such as risk reduction and decreased transaction costs resulting from ICLR.
Discussion also centred on the development of a detailed best practice guide to conducting EA, which will include guidance on timing, reliable data sources, organisational responsibility for EA, and data analysis. This guide is expected to inform the work of international organisations, governments and other interested stakeholders.
Additional important issues which were discussed include the need to address the important relationship between legal and political risk, the incentives for ICLR, quantifying the expected probability of compliance, defining what constitutes a ‘better’ rule, and data constraints (particularly ex ante).
High level points of agreement included that EA should be a permanent part of the decision making process when it comes to law reform; the EA process should occur ex ante as well as ex post; and regarding choice of instrument, there will be a need to run the formula against alternative courses of action, for example, hard law versus soft law. It was agreed that the key question in undertaking the EA will be whether a given issue is reliably and efficiently quantifiable. This will be the touchstone for inclusion.
The next meeting will be held in September 2017 and, prior to this, two project documents will be prepared: 1. The formula, which will include annotations, descriptions, and commercial law examples; and 2. The best practice guide to conducting an EA.
Moving forward, the project expects to utilise real world data, with the first EA to be of the draft Protocol to the Convention on International Interests in Mobile Equipment on Matters specific to Agricultural, Construction and Mining Equipment (the MAC Protocol),