- Jurisdiction of states, extra-territorial
This chapter first shows how the exercise of unilateral jurisdiction by States has become nearly inevitable in an era of globalization of business transactions as well as value conceptions. It then sets out the tenets of “substantivism”. It argues that multilateral solutions to transnational regulatory problems are unlikely to materialize across the board, and that internationally harmonized laws are, in terms of fairness, not necessarily preferable over the unilateral exercise of jurisdiction. Next, the chapter presents this study’s de lege ferenda approach to solving jurisdictional conflict. A “positive sovereignty” principle is proposed, pursuant to which States are allowed to apply their laws to a foreign situation, to the extent that the State that has the stronger nexus to the situation fails to adequately deal with, in a manner that is, on aggregate, harmful to the regulatory interests of the international community. By emphasizing global economic and value interests, this principle of subsidiary jurisdiction departs from the classical, negative understanding of the law of jurisdiction as a law that protects the interests of sovereign States.