Law, technology and broad socio-legal considerations -- re Schrepel (2022)

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I have just read T Schrepel’s ‘Law + technology’, which main premise is that the ‘classical approach to “law & technology” focuses on harms created by technology … [whereas] another approach dubbed “law + technology” can better increase the common good … [because it can] consider both the issues and positive contributions technology brings to society’, with ultimately the ‘goal … to address the negative ramifications of technology while leveraging its positive regulatory power’ (at 1). This leads to the claim that ‘“law + technology” can further increase the common good than a classical “law & technology” approach because it better preserves technology that regulates society in ways legal rules and standards cannot’ (at 3).

This is a weird paper and another exercise in creative labelling (or click bait) by the author (see other notable examples, such as ‘Antitrust without Romance’). The creative labelling starts with the term ‘classical “law & technology”’ itself, as the author notes: ‘Not all scholars that use the label “law & technology” recognize themselves in the meaning I attribute to the label in this article. I, nonetheless, assign a specific meaning to the label “law & technology” to highlight the differences between the dominant legal approach to technology and the one … propose[d] in this article’ (fn 2). The creative labelling exercise is completed by the artificial use of “law + technology” as a distinguishing label. I wonder how one could appreciate the (non-visual) differences if the argument was made without written support (unless one is given the clue that it should be read as 'law plus technology’, see fn 87) …

More importantly, the distinction (and the paper in general) is both artificial and far overshoots the mark of making the much simpler points that the regulation of technology needs to be underpinned by proper impact assessments (at 15-16), allow for iteration or incrementalism in particular in relation to immature technologies (at 17), and follow a certain element of proportionality to constrain e.g. the application of the precautionary principle, where too stringent legal rules could deprive society from beneficial technological advances without materially impinging on superior socio-legal values—which is what I think the author actually says on substance in the paper.

The paper thus does not really deviate from the criticised ‘classical “law & technology”’ approach, as it also recognises the two main issues: that certain socio-legal values (should) weigh more than technological innovation, and that such weighing needs to pay attention to the different (positive and negative) impacts.

In fact, the clear superiority of legally-protected values or interests is seemingly acknowledged in the paper, as it submits that ‘When law and technology present irreconcilable interests, the law must prevail in a rule of law system’ (fn 13)—even if this is then muddied in the promotion of a ‘Darwinian take on regulating technology’ that should seek not to eliminate a technology’s distinguishing features even if they breach such higher level socio-legal values (such as eg the fundamental right to an effective remedy) (at 7), or the statement that ‘When legal rules reduce technology’s chances of survival, policymakers and regulators deny one of “law + technology” two pillars. The “law + technology” approach thus requires considering different methods’ (at 17-18). Therefore, the extent to which the paper either really upholds the superiority of certain socio-legal values or, conversely, takes a more technology-centric approach is ultimately unclear (but that lack of clarity is in itself evidence of the limited deviation from the criticised approach, if any).

Similarly, the main focus on (obscurely) advocating for a regulatory approach that ceteris paribus (and only ceteris paribus) allows for a higher level of socio-technological benefits is also tucked away, but present, in the statement that ‘Under a “law & technology” approach, regulators are not comparing the effect of different intervention methods on the positive ramification of technology. They are not in a position to balance the effectiveness of the rule and its effect on the technology. Regulators may choose a regulation with comparable efficiency to others but a more negative impact on the technology’ (fn 14). Here the paper seems to simply insist on a comprehensive impact assessment, which should capture any losses derived from restrictions or prohibitions concerning the use of a given technology. This is, however, obscured by the proposal of an ‘EM ratio’ as some sort of mathematical formalisation (see fn 81) of what is simply a proportionality assessment that will almost never be susceptible to quantitative reductionism), which obscures or glosses over the impossibility of directly comparing some of the potential positive and negative impacts as they affect different socio-legal values, some of them with specific (constitutional) protection.

Overall, creative labelling aside, the paper seems to make two relatively uncontroversial statements that are also not new. Technology can facilitate legal compliance, and law and regulation should not disproportionately stifle technological innovation. So far, so good.

The labelling is still highly problematic, though, especially as it carries the risk (or intent?) of sullying ‘law and technology’ scholarship as partial or unnecessarily biased in a pro-interventionist manner. So the labelling deserves some further scrutiny.

From where I stand, it is almost impossible to assign specific meaning to “law and technology” as a field, as the interaction between law and technology can be and is being assessed from a wide-ranging and diverse set of perspectives (see e.g. the very interesting political economy approach by Julie E. Cohen, Between Truth and Power: The Legal Constructions of Informational Capitalism (OUP, 2019); or the explicit consideration of blockchain as a regulatory technology by Michèle Finck, Blockchain Regulation and Governance in Europe (CUP, 2018)). More importantly, the main hypothesis or postulate of the paper, i.e. that ‘technology and law can better increase the common good together than in a silo’ (at 4) ignores the fact that the mutual interdependence and interaction between technology and law is very much at the core of the political economy analysis of what the paper would term ‘classic “law and technology”’, as lucidly articulated by Cohen (above, 1-2).

It is also difficult to support a statement attributing to such (deemed) ‘classical’ approach to “law & technology” a one-way consideration of potential negative impacts of technologies only—unless one ignores all work on e.g. SupTech, or automated compliance; or one is blind to the fact that the balance of interests and potential impingement of rights that triggers regulatory and legislative intervention cannot result from a mere cost-benefit analysis that allows trade-offs that imply e.g. violations of fundamental rights or essential protections in consumer, labour or data privacy as key elements of the legal system. The author seems reluctantly aware of this, although the paper quickly discounts it in stressing that: ‘To be sure, the positive ramifications of technology are sometimes mentioned under “law & technology,” but they are excluded from the analytical scope when tackling the negative ramifications. In short, “law & technology” expresses at best an “on-the-one-hand-on-the-other-hand-ism,” but it fails to connect both positive and negative aspects’ (at 2-3).

Simply, then, the premises of the paper are highly questionable and generate a caricature of 'law and technology’ scholarship that is simply too far removed from reality.

Moreover, the use of unnecessarily flashy terms (e.g. Darwinian take on regulation, based on complexity theory, when what the author means is very close to systems thinking; or the formulation of an ‘EM ratio’ to refer to what is simply a proportionality assessment) is pervasive in the paper and cannot really mask the limited originality of thought underpinning the arguments.

Overall, I think this is not a helpful contribution to the debate and I hope not much time will be lost on labelling a field where the key regulatory challenges are otherwise well understood (if difficult to tackle).

More than meets the eye: La Chimia & Trepte (eds), Public Procurement and Aid Effectiveness (2019) [book review]

I have just finished reading Annamaria La Chimia & Peter Trepte (eds), Public Procurement and Aid Effectiveness. A Roadmap under Construction (Oxford, Hart/Bloomsbury, 2019). 416 pages, £86.40, reading time: 20 hours aprox.

Heart in hand, I must admit that I may not have been tempted to pick up the book if it was not edited by two scholars for whom I have great intellectual admiration and with whom I have long-lasting friendships—and if I was not on research leave and thus, having some more reading time than usual... the snazzy book cover certainly also helped. I would have made a big mistake if I had left the book accumulate virtual dust in my (only growing) to read list, though.

So this unofficial book review (remember, I am friends with the editors) seeks to save you from making that mistake yourself. If you are interested in procurement governance, or even on the broader field of international political economy, you should read this book.

I have found the book to be truly excellent and very thought-provoking, not least because it covers much more than procurement as a conduit for the economic effectiveness of foreign/development aid. For sure, this core preoccupation of the aid community (and a fringe of procurement community) is addressed centrally, thoroughly and authoritatively in the book, including interdisciplinary perspectives from political scientists, economists, lawyers and leading practitioners at international institutions. The book is thus a very valuable source of information and analysis for anyone researching the field. However, the book goes well beyond this.

The book is fascinating because it engages with a wicked problem: how to reconcile multiple regulatory layers driven by a multitude of conflicting normative values, how to find a balance between regulatory complexity and effectiveness of practical interventions, and how to do so in a manner that does not perpetuate inequality or result in regulatory imperialism. In other words, the book ultimately engages with the (impossible) challenge of designing a (perfect) procurement system of worldwide application and capable of delivering a multitude of policy goals on top of the ever present value for money.

Not that the book seeks that goal. However, in assessing legal reforms promoted by the international donor community that implicitly sought ways to achieve that nirvana (through harmonisation, alignment and other, sometimes mutually-contradictory, regulatory strategies) or that were understood as prescribing a ‘magic solution’ for such upgrade of country systems (such as the OECD Methodology for Assessing Procurement Systems, MAPS) , the book is a very effective mirror of the ugly side of procurement reform efforts.

As such, and covering such a polyhedric subject-matter, the book can be read at very different levels or from many different angles, and rewards the reader with a large number of insights that are easily transferable to other (ie non-aid) areas of procurement research and, more generally, public governance. The following are my main take aways. When you read it, please feel free to add yours in the comments section.

I found the book tells a fascinating story about hidden drivers for procurement reform and the pernicious effects they can have. Indeed, the book demonstrates how the goal of improving domestic procurement systems (in developing countries) was not set independently or with a strict concern for regulatory quality, but rather as a demand of international institutions seeking to ‘be able to rely’ on domestic systems in order to foster procurement simplification and to achieve goals of country ownership of the relevant projects.

It also demonstrates how the blueprint of what was considered ‘good procurement’ derived either from the own procurement rules of the international institutions (mostly, multilateral development banks, MDBs) or from half-baked (and misunderstood?) attempts at capturing what defines good procurement regulation (notably, the OECD MAPS, now revised). The book shines a light on the failures of such approaches and queries the wisdom of any similar future attempts. This is something that should not go unnoticed (and I am here thinking, in particular, of the World Bank’s renewed Benchmarking Public Procurement, criticised here). The book offers an unequivocal cautionary tale of the negative spillover effects of badly construed and improperly understood and/or applied regulatory benchmarks. To me, this is one of its big contributions.

From a close perspective, the book demonstrates how ‘increasing aid effectiveness’ was used as an excuse or lever to push for much broader regulatory reforms and how, in turn, this affected international discussions beyond the context of aid and of great relevance to ‘ordinary’ procurement. However, it is very difficult to establish or observe a linear influence between ‘general’ and ‘aid-related’ procurement reforms, and both seem to be part of a melting pot that resulted in significant changes of transnational procurement regulation over the first half of this decade (notably, the new WTO GPA, UNCITRAL Model Law, EU Procurement Package and World Bank Procurement Framework). All these changes evidence different speeds of pendular movements, ranging between constraints on discretion and flexibilisation of procurement regulation, as well as between purely economic and broader policy goals.

From a regulatory perspective, finally, the book also shows how an excessive focus (rectius, obsession) with fighting procurement corruption has resulted in both exceedingly rigid approaches and insufficient regulatory responses. The book documents excesses in the way that draconian anti-corruption measures can freeze frontline decision-makers and prevent them from exercising commercial discretion or risk-taking in the public interest, while leaving the real beneficiaries of corruption unaffected. This is framed in terms of an excessive reliance on agency theory for procurement regulation design. Following from that, the book shows how procurement and its tools (eg debarment) cannot be seen as the one and only regulatory tool, but rather need to be coordinated with the broader institutions of a criminal law and public law system. Failures to do so can, in large part, result from the original blueprint adopted for procurement reform (as mentioned above), as eg the MDBs do not have such a broader regulatory context.

Moving to broader themes of global governance, the book also shows the double standards applied to the assessment of country systems, depending on whether a country is a donor or a partner (ie beneficiary of aid). While developed and international organisations’ procurement systems are largely assessed on the basis of their regulation of procurement, the assessment of developing countries’ has focused more clearly on institutional capacity and on issues of professionalisation. Some of the experiences collected in the book, in particular regarding methods for the assessment of procurement systems’ maturity and for the training of a procurement workforce, could be very useful in the context of eg the European Commission’s current procurement strategy and its initiatives on procurement professionalisation. The analysis in the book also stresses the need to focus system evaluation and institutional development on the basis of procurement outcomes (not processes, or inputs), which in my view is a pending task for all procurement systems, not just those of countries receiving development aid.

Talking about double standards, the book also reports on the resurgence of tied aid and aid conditionality as one more incarnation of the surge in procurement protectionism. The discussion offers some interesting parallels with the analysis of offsets in defence procurement markets and, more generally, with the use of procurement as an industrial policy tool. These are not issues left behind, but rather a constant fight for those advocating free trade, including through procurement, to be consistent when they engage in foreign/development aid or in defence-related procurement, as well as more generally. Given the emerging use of procurement as an ‘Industry 4.0 policy tool’, these issues can only gain even further prominence in years to come.

A final thought the book spurred in me is that perhaps we should, within reason, start making ourselves comfortable with a relatively high level of regulatory complexity, in particular because outcomes-oriented procurement that seeks to achieve the sustainable development goals is a difficult endeavour. What international institutions and countries may need to do is stop trying to find easy fixes through nirvana-like regulatory simplification approaches and rather invest (heavily) in the creation of the required level of competence and capacity in their procurement workforce. This may not seem like a very likely prospect, but perhaps its chances increase if policy-makers and practitioners read this book, and if academics continue to push for practically-implementable procurement reform. So get your copy and enjoy the read.