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Compound corporations: The public law foundations of lex mercatoria

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In the introductory essay to an edited volume entitled Global Law Without a State, Gunther Teubner claims that lex mercatoria, the law of TNCs, is the 'most successful example of global law without a state'. Contrary to Teubner's claim, as compound corporations, transnational corporations (TNCs) are fundamentally intermingled with and dependent upon states throughout their legal life. The state, far from being a neutral rule-maker, often employs its public law powers to promote certain private commercial interests. In this paper, the author examines this relationship between public and private persons from the perspective of the state's corporate partner. Toindicate the public law nature of the corporate partner, we refer to these nominally-private persons as compound corporations. Such corporations alchemically mix public and private law elements to strengthen their legal power. Compound corporations have existed in various forms throughout history, including during the colonial period.


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