Developing a Sustainable Legal System for the Belt and Road Initiative

Effective implementation and enforcement of laws and regulations will to a large extent determine how successful the Belt and Road Initiative (BRI) turns out to be. Mutual respect and trust between trading partners is crucial. This chapter explores how the various legal and regulatory systems can be developed to encourage and enhance trustworthy behavior. The countries involved in Belt and Road (BR) are very varied in their legal and regulatory approaches, ranging from those which rely heavily on religious teachings to those with common law or civil law traditions. Each type of law takes a different approach to matters which are relevant to trustworthiness. Achieving a sustainable legal and regulatory framework for BR requires, as a matter of urgency, that attention is given to how the various legal systems interact. BR follows a long tradition whereby the Silk Road facilitated interchange between the great civilisations of China, Mesopotamia, Persia, India and Rome, and later Europe. Achieving this will require that trust between nations is established, not only at the highest levels of government, but also between individuals, companies and communities. Lack of trustworthy behaviour can adversely affect relations between governments (for example, between Greece and Europe), between companies (leading to numerous defaults and corporate failures, including those which accompanied the Global Financial Crisis (GFC)) and between individuals. In what follows, we explore the various methods whereby shared values (or at least a set of shared beliefs) can be developed, in order to ensure that the behaviour of those in authority is trustworthy. This varies from country to country, from sector to sector, and under different legal traditions. In doing this we draw on work carried out at Oxford and elsewhere on how trustworthy behaviour can be encouraged. We argue that it is the role of the Law, including in bilateral and multilateral trading arrangements, to ensure that relationships between market players and stakeholders are as fair and transparent as possible, through mechanisms that influence norms and hold those who behave in untrustworthy ways to account. Chinese law and practice is contrasted with those in other jurisdiction in order to explore the relative merits of each. Sustainability of the BR legal system requires consensus and long-term sustainable relationships.