Realizing the EU Social Market Economy through Law

This concluding chapter asserts that a case can be made for a strong legal pluralist theory of lawmaking in European private law. It takes a discursive approach, focusing on some aspects that require further consideration. The chapter considers how, and to what extent, the regulation of offline transactions is affected by the perceived shift towards legal pluralism. In addition, the chapter assesses which risks are posed to the instrumental-normative framework by political, economic, and social divides in the EU. Finally, the chapter closes with a reflection on the connections that could be made between certain fields such as citizens' rights as workers or in relation to environmental protection, opening up vistas for further research on lawmaking in European private law.

More Normativity

This chapter presents a second case study, focusing on standardisation. Standardisation is defined as a process of private regulation whereby private actors engage in the development of standardised norms for particular sectors of industry or for particular types of contract. Standards, which are widely used in European markets, can also serve as a case study for determining whether the substance of norms created through private regulation can fulfil the instrumental-normative aims of a legal pluralist theory of lawmaking in European contract and consumer law. Here, the enquiry is delimited to harmonised standards in EU law. Harmonised standards are developed by European standard-setting organisations (ESOs) at the instigation of the European legislator.

The Normative Side

This chapter analyses the relations between the various sources of norms introduced in the previous chapter to assess the space for deliberation between lawmaking actors. To that end, the substance of norms developed in private regulation by platforms and through contracting is tested against the objectives and values of existing rules of EU and national contract and consumer laws to establish whether these are adhered to, or not. In terms of substance, the case study focuses in particular on transparency in contracting, that is, the question whether terms and conditions are clear and comprehensible to parties entering into contracts. Practically, two platforms are selected for the case study. One is aimed at connecting users for the exchange of services (Airbnb) and the other for the exchange of goods (Amazon).

New Legal Pluralism and Transnational Private Law

This chapter makes an analysis of the theoretical foundations of lawmaking in European private law. It shows that they can be traced to transnational and constitutional pluralist theories. The main question is in which respects legal pluralism should replace the monist, state-centred perspective on lawmaking that prevailed in Western Europe since the creation of the Westphalian nation state. It is argued that, even though the state remains the primary locus for lawmaking in private law in the EU, the rise of private regulation and the interaction between courts through judicial dialogues plead in favour of adopting a strong legal pluralist perspective. ‘Strong’ or ‘radical’ legal pluralism, other than monism or ‘ordered’ legal pluralism, holds that norms can co-exist without a formal hierarchy. Both a descriptive and a normative case are put forward in support of adopting this perspective.

Introduction

This introductory chapter presents the major themes of study and narrows the scope of research to the European Union (EU). It briefly examines developing trends in the market for consumer goods and services as well as the legal systems which changed to accommodate these trends. In particular, the chapter focuses on the platform economy. It discusses issues arising from these developments, especially as they apply to private law. Private law concerns the contractual rights that suppliers and customers have vis-à-vis each other and their potential liability. However, whereas the rights and duties of these parties would normally be governed by rules of national contract and consumer law, or perhaps also by rules of European origin if the parties are in the EU, the platform economy has created a private sphere that operates largely through other mechanisms. From here, the chapter introduces research questions as well as a new approach to lawmaking in European law.

Objectives and Values

This chapter delves into the substantive values that underlie contract and consumer law in the EU. It shows that lawmaking in European contract and consumer law is embedded within the ordoliberal ideology on which the EU internal market was founded, yet is shaped not only by economic rights but also by social rights. Those rights have a basis in Articles 2 and 3 of the Treaty on European Union (TEU), which ground European cooperation in the common pursuit of a ‘highly competitive social market economy’ — social justice, equality, amongst other values and objectives. While the balance between economic and social rights in this area is in flux, the EU Treaties in combination with secondary legislation, case law, and the EU Charter of Fundamental Rights circumscribe a framework of shared values and objectives within which a substantive deliberation between lawmaking actors can take place. The chapter argues, therefore, that the EU legal order has a normative basis that enables legal pluralist perspectives on lawmaking to go beyond procedural approaches.

Managing Pluralism

This chapter examines which mechanisms can provide ‘checks and balances’ for the rules created by different lawmakers in a legal pluralist constellation. The question here is which space exists for the creation and maintenance of private governance mechanisms based on voluntary participation. First, the chapter maps the mechanisms for monitoring the substance of private lawmaking, in so far as they relate to European contract law. Second, the spaces that exist between private and public regulation in relation to each of these instruments are examined. The chapter moves on to a more in-depth analysis of the space that private regulation has besides public regulation. The relevant mechanisms that can be discerned are: standardisation of contracts, the use of optional instruments or model rules in contract law, and monitoring through online dispute resolution.

A Theory of Substantive Deliberation

This chapter examines the normative substance of rules of European private law. Lawmaking in this field stands apart from transnational law due to its commitment to the objectives and values of European contract and consumer law. That characteristic means that, in theory, legal pluralism in European private law could go beyond a procedural approach — in which mechanisms of recognition and toleration determine how norm conflicts are mediated between legal orders — to a normative approach that prescribes to which values outcomes should adhere. The chapter submits, therefore, that European private law contains elements that allow for a ‘substantive deliberation’ of rules, values, and objectives. This means that a recursive process between lawmaking actors in which the substance of rules — laid down in public and private regulation — is examined, and adjusted if it falls below the threshold that EU law prescribes. Whilst the reference to objectives and values seems to imply an ordering of some sort, it is argued that a strong legal pluralist framework can still be maintained. The coordination of lawmaking can occur through an instrumental-normative approach.

The Platform Economy

This chapter charts which rules concerning contracts and consumer protection have until now emerged in public and private regulation. These contain a mix of public regulation, co-regulation, codes of conduct, soft law projects to develop model rules, and reputational feedback systems. Also, online dispute resolution can in practice be a source of norms, as norms developed in this context are often through a feedback loop used to improve the quality of services offered by platform operators. Here, the chapter places the focus on the platform economy. Platforms themselves are actively working to provide mechanisms that can, at least partly, overcome the problems of enforcing consumer rights. They have an interest in securing trust between users who, even more than consumers in the offline world, are at a disadvantage in establishing the quality of goods and services and the reliability of their counterparty. Platforms therefore use mechanisms that can fill in a ‘regulatory void’.

Pluralism in European Private Law

This chapter examines the further contours of an instrumental-normative approach, focusing on how the question ‘who does what, and at what level of regulation’ is answered by existing theories of legal pluralism in European private law. It has been said that most theories of legal pluralism in European private law, even if they proclaim to adopt a strong legal pluralist perspective, still fall back on an ordering of some sort. The chapter tests this assumption by analysing how the market rationality of EU law interacts with the juridical rationality of national private laws in relation to three aspects of lawmaking: actors, norms, and processes. It concludes that many theories of legal pluralism in European private law lean towards an ordering of some kind. Yet, at the same time the chapter reveals several instances in which inroads are made on the ordered conception of legal pluralism, which could provide the premises for the further development of a strong legal pluralist theory for European private law.