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Feature TYLA Project

TYLA Diversity Committee Partners with International Law Section (ILS) of the State Bar on “Rule of Law” Panel Discussion
By:  Erin E. O’Driscoll, Morgan, Lewis & Bockius LLP

On November 8, 2012, the TYLA Diversity Committee and ILS hosted a networking lunch featuring an in depth panel discussion about the “Rule of Law in a Diverse World” moderated by TYLA President, C.E. Rhodes, in Houston, Texas held at Vinson & Elkins LLP.  Panelists included:  George Gonzalez, Partner, Haynes and Boone, LLP; Hon. Luz E. Nagle, Professor of Law, Stetson University; Ignacio Pinto-Leon, Assistant Director, University of Houston Center for U.S. and Mexican Law; and William Russell, Attorney, Schirrmeister Diaz-Arrastia Brem, LLP.  We had fifty attendees composed of current practitioners as well as Houston-area law students interested in pursuing an international practice.

The topic of the “Rule of Law in a Diverse World” is an ambitious topic of discussion given its breadth in subject-matter.  The panelists set out to discuss various subtopics such as:  What is the “Rule of Law?” Does the “Rule of Law” mean different things in different jurisdictions? How should lawyers advise clients in jurisdictions where the “Rule of Law” is unclear? What role do U.S. courts play in evaluating the “Rule of Law” in foreign jurisdictions?  How does the Rule of Law impact social, economic, and political issues?  These signposts guided an informative and intellectual discussion that circled around a central theme— the significance of transparency and predictability of the law.

The Rule of Law means something different depending on which country you are in.  The impact of the Rule of Law is evident not only in the transactional realm, but it also has significant implications in litigation and human rights in the international context.  Mr. Gonzalez discussed the effect of gaps in the law and mechanisms which provide safeguards during a business transaction.  He also emphasized the importance of consistency in application of the law, as well as harmony in business law when multiple jurisdictions are placed on an equal playing field, such as when treaties like NAFTA govern a transaction.

It is also unmistakable that the Rule of Law plays a critical role in terms of individual, human rights, and social justice across the globe.  According to former Columbian Judge Nagle (and current professor at Stetson University), the Rule of Law has been evolving since the 1960-70’s, with a significant emphasis on the judiciary.  Many nations have been fueled by globalization which has resulted in changes in the Rule of Law.  One way in which developing countries encourage investors to come to their nations is by focusing on the Rule of Law, and many have found that a “one size fits all” approach is not effective.  The Rule of Law is the ultimate regulator over government power and it provides a system of checks and balances over that control.  When the law is certain and clear, the business world benefits because of the resulting predictability.

Judge Nagle further expounded that the beauty of globalization is that if a country wants to compete from a business perspective, they need to improve the working and living standards for their citizens.  Key global business leaders play an important role in improving those standards by requiring that living/working conditions improve and as a result, the hope is that a company’s product will be more sought after due to their efforts to improve these standards.  This is especially evident whether in the context of corporate due diligence under Dodd Frank, corporate codes of conduct imposed on suppliers of goods, the human rights issues surrounding conflict minerals, or human trafficking to name a few examples.  International principles impose edicts on companies for international crimes, and this area has further expanded into international war crime tribunals.  The Rule of Law has far reaching implications and it touches on all of these issues which provide a platform for discussion.            

Professor Pinto-Leon commented that the biggest enemy in the Rule of Law context is corruption.  The more transparent a country is, the less corrupt the country will be.  The critical value of the Rule of Law is the impact of making the playing field “equal” for all.

Mr. Russell’s practice involves the Rule of Law in the context of international arbitration and he described case precedent in this area.  He commented that from a historical standpoint, the Rule of Law goes back to “the law is king” and not “the king is law,” as articulated by Thomas Paine at the time of the American Revolution.  The Rule of Law is powerful and when the government changes the law retroactively, it can be devastating for companies that quickly find out that the state is more powerful than the law in certain jurisdictions.  Mr. Russell describes judicial cultures as tectonic plates that move and shift, and international arbitration is on those fault lines.  He emphasized the important role that rules and treaties signed can reduce the friction among those tectonic plates.

The panelists agreed that we as practitioners all have an important ethical responsibility to improve the Rule of Law both domestically and internationally in all areas of practice.

TYLA would especially like to thank Justin Marlles (BHP Billiton) and Tim Tyler (Vinson & Elkins LLP) of ILS in partnering on this event.  TYLA President, C.E. Rhodes (Baker Hughes) and Directors Lacy Durham (Deloitte Tax LLP), Erin O’Driscoll (Morgan, Lewis & Bockius LLP), and Paul Tu (Arrington, Tu & Burnett L.L.P.) were instrumental in planning this event.  TYLA hopes to partner with ILS on future events.