The Futility of Unification and Harmonization in International ...

to the shipper. Each case involved an international commercial transaction, and in each the Courtupheld contractual forum clauses that had either a direct or indirect effect on the underlyingsubstantive law.Of course, none of the Supreme Court cases held that parties had an unqualified right to contract82out of mandatory statutory rules. The Bremen noted that the British law, although different fromthat of the United States, did not violate U.S. public policy. Mitsubishi Motors emphasized thedifference between enforcing an agreement to arbitrate and enforcing an arbitral award, and indicatedin dicta that an arbiter’s failure adequately to address the antitrust claims would render its award anullity in the United States. Carnival Cruise Lines held that the law of Florida, the forum chosen inthe form contract, did not oppress passengers. Vimar left open the possibility that the Japanesearbitral award would not be enforced if the arbiter applied substantive law that differed substantiallyfrom the requirements of the Carriage of Goods at Sea Act. In every case the Court invoked its rightto retain control over the substantive law that would result from enforcing the contractual choice offorum. But the Court also indicated that the foreign law need not serve as a perfect substitute forU.S. rules, and it upheld the principle of freedom of contract even when a transaction involved aconsumer and a small-print standard form. The tendency to prefer contractual choices over regulatorynorms exists, even if it has not blossomed into an unequivocal commitment.What we have seen is a fundamental shift in the terms of debate over homemade law ininternational commercial relations. Before The Bremen, the relevant question is whether personsinvolved in international commerce had any right to choose which legal system would govern theirrelations. After Vimar, the issue has become what limits remain on the exercise of this right. A worldof possibilities has opened, even though its boundaries remain undetermined.Analogical strategies in related areas of commercial law exist. As many observers have noted,U.S. corporate law allows states to compete over the terms under which corporations will be allowedto govern themselves. This competition exists only because in the United States, unlike Europe, aconsensus accepts that the law of the state of incorporation, a voluntary contractual choice, willgovern most issues arising out of a firm’s internal decisionmaking. Academics have argued fordecades whether this competition is virtuous or malign, but the best recent evidence supports theproposition that corporate managers decide where to incorporate largely on the basis of whichjurisdiction’s laws are most likely to maximize the firm’s value. 83Could a similar approach in international commercial law produce a virtuous race to the top? Icannot offer a definitive response. Too much depends on debatable assumptions about the politicaleconomy of the many branches of international commerce. We simply do not know enough about3582Lower courts have enforced contracts for the sale of securities that have the effect of replacing U.S. securitiesrdthregulation with the comparable laws of the United Kingdom. See, e.g., Richards v. Lloyd’s of London, 135 F.3 1289 (9 Cir.rd th rd th1998); Haynsworth v. The Corporation, 121 F.3 956 (5 Cir. 1997); Allen v. Lloyd’s of London, 94 F.3 923 (4 Cir. 1996);rd th rd thShell v. R.W. Sturge, Ltd., 55 F.3 1227 (6 Cir. 1995); Bonny v. Society of Lloyd’s, 3 F.3 156 (7 Cir. 1993), cert. denied,ndnd510 U.S. 111 (1994); Roby v. Corporation of Lloyd’s, 996 F.2 1353 (2 Cir.), cert. denied, 510 U.S. 945 (1993); Riley v.ndKingsley Underwriting Agencies, Ltd., 969 F.2 953 (10th Cir.), cert. denied, 506 U.S. 1021 (1992).83For a review of the literature, see Roberta Romano, FOUNDATIONS OF CORPORATE LAW 87-99 (1993).