Just Published: "Are Supply Chains Transnational Legal Orders? What We Can Learn from the Rana Plaza Factory Building Collapse"

I am happy to announce the publication of an article, "Are Supply Chains Transnational Legal Orders? What We Can Learn from the Rana Plaza Factory Building Collapse," that appears in the UC Irvine Journal of International, Transnational, and Comparative Law 1(1):11-66 (2016).

The article was a contribution to a symposium, Transnational Legal Ordering and Private Law, held at UC Irvine School of Law. Many thanks to Gregory Shaffer for putting this together.  The symposium concept note explained that our purpose was to assess and evaluate "the extent of change in private law and business regulation that transcends the nation state. Such law and regulation seek to produce order in an issue area that relevant actors construe as a problem. These problems range from labor rights of garment workers to food safety; to securities fraud and financial crises; to corporate social responsibility; to the allocation of authority among courts to hear transnational disputes." In addition to Greg's introduction and my contribution, the issue includes important articles by Cynthia A. Williams, Hannah L. Buxbaum, Christopher A. Whytock, Ralf Michaels, and Peer Zumbansen.

The abstract and introduction follows; comments and engagement always welcome. This work continues earlier efforts to try to understand first, the context in which the enterprise with governance authority may exercise that power, both as to the character of that regulatory power (here); second, the institutional organization from which it is asserted (here); and third, the relationship of that emerging complex of regulatory power to the existing structures of law and politics built around the state (here). This effort seeks to place these governance mechanisms within a broader governance territory by considering what the response to the Rana Plaza factory building collapse reveals about the "territories" governance, the way that those territories function. 

Are Supply Chains Transnational Legal Orders? What We Can Learn from the Rana Plaza Factory Building Collapse

Larry Catá Backer*

Abstract: In 2013, over a thousand workers were killed when the Rana Plaza factory building collapsed in Bangladesh, one housing several garment factories producing goods for global consumer markets. The collapse, and its consequences, exposed both the complex interweaving of national law, international standards, and private governance standards that together might be understood as a transnational legal order that has some effects on business behavior. This essay engages in a close examination of the Rana Plaza factory building collapse and its aftermath as the starting point for theorizing systemicity in the emerging interlocking systems of national, private and international governance orders. At one level, the governance architectures around the Rana Plaza building collapse suggests bits and pieces of governance and lawmaking that may point to the development of distinct governance orders that bump into each other serendipitously. Yet it is also possible to theorize systemicity from out of these bits, pieces, and bumps that may suggest the nature and forms that are emerging as a distinct class of transnational legal order. Starting from the governance response to the Rana Plaza building collapse facts, this article examines the way that the collective actions of states, international organizations, enterprises, civil society, and affected groups evidence a robust transnational legal order. That transnational order has a normative structure, operationalizes a legal process, and structures a framework within which international organizations, and state and non-state private actors strive toward building functional coherence within formally polycentric governance orders. Alternatively, Rana Plaza might suggest polycentric governance ordering or the new face of old hierarchical relations between developed and developing states. The essay concludes that the reality of the context in which governance arises may continue to defy a single robust theorization. Theories may be chasing facts, but the complexity of the legal ordering reflected in the arc of the story of the Rana Plaza factory building collapse also suggest that facts may soon turn on and reshape theory.

I. Introduction

On April 24, 2015, high level representatives of the governments of the United States and the European Union released a statement marking the second anniversary of the “tragic collapse of the Rana Plaza building in Dhaka, Bangladesh, that claimed over 1,100 lives and injured many more . . . mourning those who lost their lives and remain mindful of the difficult struggle for those who survived.”[1] It was one of several statements issued by powerful global actors to mark this event, and the train of consequences that followed.[2] In stark contrast, the office of the Bangladesh Prime Minister spent the day responding to criticisms of the way in which her government had allocated and spent funds earmarked for the victims of that factory collapse and their families.[3]

Yet the U.S.-EU Joint Statement did more than commemorate. Its object was not merely to mourn the loss of life in the daily business of global trade along complex supply and production chains. Rather, the Joint Statement served as a celebration, a commemoration, of the triumph of a new sort of multilateral governance architecture, one in which the state, or at least a small state like Bangladesh,[4] would now share responsibility for governing its own territories with others.

In the aftermath of the Rana Plaza collapse, the European Union, the United States and the International Labor Organization (ILO) joined with Bangladesh (“The Partners”) to undertake a series of significant commitments to foster respect for fundamental labor rights and ensure worker safety and health in the garment sector. The Partners announced the Sustainability Compact for Bangladesh – a statement of principles and commitments designed to bring about a lasting transformation in the sector.[5]

That sharing, however, did not merely involve the states that represented the largest enterprises which sources garments from much smaller enterprises within Bangladesh. It also involved a host of other actors—enterprises, NGOS, labor organizations, and international public and private actors, in distinct and complex ways.[6]

The collapse, then, exposed not just the structural weakness of the Rana Plaza factory building, but also the structural weaknesses of traditional ways of understanding and invoking regulatory authority. But how? The collapse, and its consequences, then, might be understood as uncovering the complex interweaving of national law, international standards, and private governance standards that together might be understood as a transnational legal order that produces effects on business behavior, and on the regulatory activity of states both within and beyond its borders.[7] Or it might be understood as a reflection of patterns of rough consensus around the logic of the societal systems in which even states now operate.[8] Or it might be understood to serve as a disciplinary and socialization technique, a means of managing and gap filling among communities of states.[9]

This essay uses the circumstances of the Rana Plaza factory building collapse and its aftermath as the starting point for an examination of possibilities of generalizing theory from circumstances. The connection between theory and fact tends to be dynamic at best, and substantially disconnected at worst. It can be distorted as much at the micro level from an obsessive examination through the generalized implications of data—a cancerous self-referencing empiricism that reduces theory to algorithm—as it can be the victim of an inverted cause and effect at the macro level, in which theory is used instrumentally to make facts, that is when theory becomes politics. Yet in our culture, one marked by elite-driven mass mobilization societies, theory can serve both qualitative and quantitative driven instrumentalism by offering a coherent structure within which the reality around us can be ordered, either around a central concept or insight, or around nothing at all.

Indeed, the narrative of the Rana Plaza factory building collapse does offer a framework for connecting realities on the ground to the construction of theory that is around it. Such a theory would have to be dynamic, in the sense that it must recognize in the rather complex realities that is the Rana Plaza factory building collapse, a temporal sequence of governance arrangements. Alternatively, efforts at theorizing the regulatory constructions built on the foundation of the Rana Plaza Building collapse might suggest a caution in that theory building and a reminder that the relationship between facts and theory might neither be invariably vertically arranged or, thus arranged, invariably placing theory above facts on the ground.

If theorization is possible, might a better theorization of Rana Plaza lie with Transnational Legal Order (TLO) theory? It is possible that one might view Rana Plaza as evidence of the crystallization of the emergence of a transnational legal order governing business behavior. That transnational order has a normative structure, operationalizes a legal process, and structures a framework within which international organizations, and state and non-state private actors strive toward building functional coherence within formally polycentric governance orders. It assesses the operation of a normative order that can be viewed in terms of norms that affect the understanding of actors of their legal obligations by considering how different norm systems—state law, international standards, and private governance standards—intermesh[10] in shaping the expectations of businesses and their counsel of their legal obligations. And in intermeshing, constitute yet another and potentially distinct legal or governance order or orders. That might be done by grounding analysis in not only a series of contingent circumstances (transnational business activity, activist responses, different forms of norm building) but also from out of precipitating events (such as catastrophes). It is that combination that leads to the interaction of these various standards to shape transnational legal norms that can be viewed as a form of legal order in a world otherwise lacking centralized legal law-making and law-applying institutions as conventionally conceived at the national level. Two alternative possibilities are considered as well. First, it may be possible to see in Rana Plaza confirmation of the emergence of transnational dis-order or un-ordering. Alternatively, still, one can see in Rana Plaza a confirmation of the workings of the traditional and conventional state-law system and its ability to embrace changing circumstances without losing its internal coherence.

After this introduction, Part II focuses on the events leading up through and then past the collapse of the Rana Plaza factory building on April 24, 2013. The catastrophe is used, in a sense, as a lure to attract the conventional and emerging governance actors and then to consider how they behave (in the production of governance objects) with the lure and each other. Part III then seeks to extract a theory out of the context of the story of the Rana Plaza factory building collapse. Does Rana Plaza fit comfortably or uncomfortably into the narrative of TLO, and its implications for TLO theory? Does Rana Plaza instead suggest the possibility of disordered order, that is of order without a center as an alternative perspective? And lastly, does Rana Plaza still fit comfortably into traditional narratives of state-law system, or point to something considerably more radical?

NOTES:

*Larry Catá Backer is W. Richard and Mary Eshelman Faculty Scholar Professor of Law and International Affairs, Pennsylvania State University. My thanks to my research assistant, Angelo Mancini, (Penn. State Law JD expected 2018) for his usual excellent work.

[1] Press Release, Office of the United States Trade Representative, Joint Statement on the Anniversary of Rana Plaza Building Collapse in Bangladesh (Apr. 2015), https://ustr.gov/about-us/policy-offices/press-office/press-releases/2015/april/joint-statement-anniversary-rana. The Joint Statement was released in the names of U.S. Secretary of State John Kerry; High Representative of the European Union for Foreign Affairs and Security Policy Federica Mogherini; U.S. Secretary of Labor Thomas E. Perez; EU Commissioner for Employment, Social Affairs, Skills and Labour Mobility Marianne Thyssen; U.S. Trade Representative Michael Froman; EU Commissioner for Trade Cecilia Malmström; U.S. Agency for International Development Acting Administrator Alfonso E. Lenhardt; and EU Commissioner in charge of International Cooperation and Development Neven Mimica. Id.

[2] Among them were those from NGOs, see, e.g., Statement by the Clean Clothes Campaign on the second anniversary of the Rana Plaza disaster (Apr. 24, 2015), https://www.cleanclothes.org/news/2015/04/24/statement-by-the-clean-clothes-campaign-on-the-second-anniversary-of-the-rana-plaza-disaster; see also European Parliament resolution of 29 Apr. 2015 on the second anniversary of the Rana Plaza building collapse and progress of the Bangladesh Sustainability Compact (2015/2589(RSP)), http://www.europarl.europa.eu/sides/getDoc.do?type=TA&reference=P8-TA-2015-0175&language=EN&ring=P8-RC-2015-0363.

[3] PMO Trashes TIB Report on Rana Plaza Assistance, The News Today, Apr. 24, 2015, http://www.newstoday.com.bd/index.php?option=details&news_id=2409293&date=2015-04-24 (“Dismissing Transpa-rency International Bangladesh's (TIB's) report that claimed Tk 108 crore mobilised in the prime minister's aid fund to distribute among Rana plaza victims remains unused, the Prime Minister's Office (PMO) on Thursday said there is no fund in the name of Rana Plaza, reports UNB. "I would like to clearly say there is/was no fund in the name of Rana Plaza in the Prime Minister's Office. There are two funds of the honorable Prime Minister-one is Relief and Welfare Fund and another is Discretionary Fund," said PMO Director General-4 Kabir Bin Anwar. He said this while addressing a press conference to clarify TIB's version on the fund of Rana Plaza victims held at the PMO.”).

[4] The policy and structural issues for law and state systems are considered further in Larry Catá Backer, Economic Globalization Ascendant: Four Perspectives on the Emerging Ideology of the State in the New Global Order, 17(1) Berkeley La Raza L.J. 141-68 (2006).

[5] Press Release, Office of the United States Trade Representative, supra note 1.

[6] The European Parliament Joint Motion provided a clear window on the web of regulatory sources and constraints within which Bangladesh now finds itself as actor and object. See European Parliament resolution of 29 Apr. 2015, supra note 2.

[7] See Transnational Legal Orders (Terence C. Halliday & Gregory Shaffer eds., Transnational Legal Orders (Cambridge Univ. Press, 2015).

[8] See Gralf-Peter Calliess and Peer Zumbansen, Rough Consensus and Running Code: A Theory of Transnational Private Law 134-52 (Oxford, 2010).

[9] See, e.g., Robert Wai, Transnational Public Law and Private Ordering in a Contested Global Society, 46 Harv. Int’l L.J. 471 (2005).

[10] See Gunther Teubner, Self Constitutionalizing TNCs?: On the Linkage of “Private” and “Public” Corporate Codes of Conduct, 18 Ind. J. Global Legal Stud. 617 (2011).