Abstract
Professor Mattei has observed that any legal observation is lacking in analytical value unless the researcher is conscious of the layer of the legal system’s structure at which he is conducting his studies.1 Legal scholars who have undertaken a study specifically focused on the legislation on foreign investment in the former USSR expressed this succinctly:
[i]t is crucial for western investors in the former Soviet Union to exercise caution and to maintain vigilance in undertaking business ventures purely on reliance on the texts of the new legislative acts governing their rights and obligations … The macroeconomic and socio-political dimension of western investment in Russia should be carefully examined in light of current historical trends.2
In turn, in the course of an analysis of the process of development of commercial law in transitional states, Gray and Hendley stress that the transition in former socialist states is ‘most fundamentally a change in the role of the state’.3 They argue that the role of the state in the post-Communist context is vital because parties will have stronger incentives to take advantage of legal rights and abide by legal responsibilities primarily to the extent that they depend on the market, rather than the state, for survival.4
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Notes
U. Mattei (1997) ‘Three Patterns of Law: Taxonomy and Change in the World’s Legal Systems’ 45 American Journal of Comparative Law 5, 19.
W.G. Frenkel and M.Y. Sukhman, ‘New Foreign Investment Regimes of Russia and Other Republics of the Former USSR: Legislative Analysis and Historical Perspective’ (1993) 16 Boston College International and Comparative Law Review 321, 422–3.
C. Gray and K. Hendley, Developing Commercial Law in Transition Economies: Examples from Hungary and Russia. The World Bank Policy Research Working Paper No. 1528 (1995) 1. They emphasize that ‘the state must withdraw from everyday control over most aspects of economic life, and the central economic controls associated with the state’s central planning apparatus must be replaced by decentralized, objective rules of the game, i.e. the “rule of law”. The patron–client networks and the resulting particularism that characterized economic relations under the state socialism have to give way to relationships based on universalistic rules’.
K. Boyle, T. Hadden and P. Hillyard, Law and State: the Case of Northern Ireland (1975) 1. They say that ‘in settled times this fact may become obscured. The apparent independence of the legal system from current political disputes lends support to the myth that law is something above and apart from the society which it helps to regulate and control. An alternative view is that law is nothing but an instrument of domination in the hands of the property owners or the political elite. This is equally unsatisfactory. Adherence to either view serves only to obscure the kernel of truth which lies behind them both, that a legal system is the determining factor and the power structure remains very much in the background. In times of political and social disruption value systems recede into the background and the reality of political, economic and military power is likely to prevail’.
R.B. Siedman, The State, Law and Development (1978) 15–16.
H.V. Morais, ‘Emerging Legal Strategies of Host States to Attract Foreign Investment’ in Current Developments in International Investment Law (1996) 247–59.
F.A. Hoebel, The Law of Primitive Man: a Study of Comparative Legal Dynamics (1954) 292.
G. Sawer also says: ‘The material content of a legal system has always been to reflect in some sense the needs or demands of societies’. See G. Sawer, Law in Society (1965) 147.
M.D. Holmes (ed.), The Common Law (1963) 5.
L.M. Friedman, American Law: an Introduction (1984) 6.
See, for example, D.M. Trubek, Law and Development: the Future of Law and Development Research (1974)
D.M. Trubek and M. Galanter, ‘Scholars in Self-Estrangement: Some Reflections on the Crisis of Law and Development Studies in the United States’ (1974) 4 Wisconsin Law Review 1062;
D.M. Trubek, ‘Toward a Social Theory of Law: an Essay on the Study of Law and Development’ (1972) 82 (1) Yale Law Journal 1.
P. Nonet and P. Selznick, Law and Society in Transition: Toward Responsive Law (1978).
See P.H. Rubin (1977) ‘Why is the Common Law Efficient?’ 6 Journal of Legal Studies 51;
G.L. Priest, ‘The Common Law Process and the Selection of Efficient Rules’ (1977) 6 (1) Journal of Legal Studies 65;
E.D. Elliot, ‘The Evolutionary Tradition in Jurisprudence’ (1985) 85 Columbia Law Review 38;
D.C. North and R.P. Thomas, ‘An Economic Theory of the Growth of the Western World’ (1970) 23 Economic History Review 1.
R.C. Clark, ‘The Interdisciplinary Study of Legal Evolution’ (1981) 90 Yale Law Journal 1238.
They considered the law as a manifestation of the will of the state and as a tool of the latter. Lenin wrote: ‘Laws are political measures’. Samuel Jawitsch, a well-known Soviet professor of Theory of Law, stated: ‘Laws and statutes most clearly express the will of the ruling class’. In S.L. Jawitsch, The General Theory of Law (1981) 43.
L.M. Friedman, The Legal System: a Social Science Perspective (1975) 270. He identifies these four types in the following terms:
S. Vago, Law and Society, 3rd edn (1997) 216.
A. Podgorecki, Law and Society (1974) 225. More precisely, Podgorecki says: ‘An abstract legal precept begins to function (and to be expressed in social behaviour) when it reaches its interpreter in the form of a complex conjunction. The constituent parts of such a conjunction are: the precept itself and three meta-norms: the first derives from the character of the social and economic system, the second takes its content from the definite sub-culture and the third follows from the personality of the individual who makes the decision to behave lawfully’.
See W.M. Evan (ed.), The Sociology of Law: a Social-Structural Perspective (1980) 554–62;
A. Allot, The Limits of Law (1980).
T.C. Halliday and B.G. Carruthers, The State, Professions, and Legal Change: Reform of the English Insolvency Act, 1977–1986. American Bar Foundation Working Paper No. 9019 (1990). Some scholars concentrate on political bargaining to explain the nature and effects of legal change.
See, for example, J.F. Handler, Social Movements and the Legal System: a Theory of Law Reform and Social Change (1978);
E. Bardach, The Implementation Game: What Happens After a Bill Becomes a Law (1977);
R.T. Nimmer, The Nature of System Change: Reform Impact in the Criminal Courts (1978).
S.A. Velkei, ‘An Emerging Framework for Greater Foreign Participation in the Economies of Hungary and Poland’ (1992) 15Hastings International and Comparative Law Review 695, 696.
See R.B. Schlesinger, H. Baade, M. Damaska and P. Herzog, Comparative Law: Cases, Text Materials (Mineola, NY: Foundation Press, 1988) 78.
T.W. Waelde and J.L. Gunderson, ‘Legislative Reform in Transition Economies: Western Transplants — Short-Cut to Social Market Economy Status?’ (1994) 43 The International and Comparative Law Quarterly 347, 355.
B. Rudden, ‘Civil Law, Civil Society, and the Russian Constitution’ (1994) 110 The Law Quarterly Review 56, 68.
See A. Watson, Sources of Law, Legal Change, and Ambiguity (1985).
U. Mattei, ‘Why the Wind Changed: Intellectual Leadership in Western Law’ (1994) 42 American Journal of Comparative Law 195, 205.
A. Watson, Society and Legal Change (1977) 6.
Waelde and Gunderson, commenting on the central thesis of Watson, note: ‘his strong urge to disprove the thesis that specific legal rules are intimately and inextricably linked to a society’s social, political and cultural fabric by indicating numerous instances where legal rules have been transplanted to quite different societies makes him, however, focus on “technical rules” — the dogmatic core of lawyers’ law, and not the part of legislation which is very much linked to a society’s fabric, such as economic policies, economic regulation, competition law. Traditional contract law — Watson’s main playground — needs intricate specific rules to settle cases, … but it has little interest in social outcomes. It is for this reason that traditional contract law may survive, very much with a Roman law core, in all kind of different societies’. See T.W. Waelde and J.L. Gunderson, ‘Legislative Reform in Transition Economies: Western Transplants — Short-Cut to Social Market Economy Status?’ (1994) 43 The International and Comparative Law Quarterly 347, 369.
O. Kahn-Freund, ‘On Uses and Misuses of Comparative Law’ (1972) 37 Modern Law Review 1, 12–13.
P. Fitzpatrick, Law and State in Papua New Guinea (1980) chapters 1 and 2.
R. Pomfret, The Economies of Central Asia (1995) 134.
M.K. Kozybayev (ed.), The Text-Book on the History of Kazakstan from Ancient Times until the Present (1992) 144.
P.T. Muchlinski, ‘“Basic-Needs” Theory and “Development Law”’ in F. Snyder and P. Slinn (eds), International Law of Development: Comparative Perspectives (1987) 237–70.
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© 2002 E.K. Dosmukhamedov
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Dosmukhamedov, E.K. (2002). The Legal Regulation of FDI in the Context of Legal Reforms. In: Foreign Direct Investment in Kazakhstan. St Antony’s Series. Palgrave Macmillan, London. https://doi.org/10.1057/9780230502178_7
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