As we discussed in section 2, English law—as with any other legal system in the world—is an infrastructure on which transactions take place. English law, however, is notable for the extent to which it is used not only in domestic transactions occurring within the UK, but also in internationally mobile transactions. English law was and is the global standard in many types of transactions across the world from sectors including commodities, shipping and some areas of financial services. As has been shown in this report, this results in significant economic benefits for the UK. English law is therefore an important national asset for the UK. However, there has been little recognition of this and little concerted effort to consciously maintain and promote this asset for the benefit of the UK as a whole. We discuss the role of industry bodies—the Bar Council and the Law Society—in promoting English law to non-UK audiences in section 5.4.
In this section, we explore the key considerations relating to the management and strengthening of the asset that is English law, especially for internationally mobile transactions.
This section is structured as follows.
- Section 5.2 discusses the market failure from which English law suffers and the consequences resulting from the free-rider problem.
- Section 5.3 presents and illustrates (with examples) considerations from economic theory on dealing with the free-rider problem.
- Section 5.4 draws from economic theory to propose a solution in the context of English law specifically.