Reversing delegation? Politicization, de‐delegation, and non‐majoritarian institutions

International non-majoritarian institutions (NMIs) in finance have proliferated over the last decades. The Basel Committee on Banking Supervision (BCBS) is the main international NMI in finance and the European Union (EU) is one of its core jurisdictions. Despite the far-reaching effects of international banking standards in the EU, especially the Basel accords, there has been limited politicization of delegation to the BCBS and no attempt to reverse it. Why? By taking a "soft" principal-agent approach, this paper points out two explanatory factors: the composite nature of both the principal and the agent. It also identifies a pattern that can be generalized to other international NMIs in finance. Thus, following the initial delegation of international standard-setting to the BCBS, this international NMI considerably increased its activities, going beyond what certain elected officials wanted; the response from elected officials was limited to the use of relatively weak ex-ante and ex-post controls, including delayed compliance.

Section: The Principal‐agent Approach To Explain Delegation To Nmismentioning

confidence: 99%

The non‐reversal of delegation in international standard‐setting in finance: The Basel Committee and the European Union

Quaglia

2022

“…To preview, formal de‐delegation has occurred once, suspending the operation of the SADC Tribunal. Second, states can eliminate the authority of an international court over themselves “by withdrawing from the agreement” (Thatcher et al, this issue). We have labeled this option “individual de‐delegation (withdrawal)”.…”

Section: Concepts Theory Research Designmentioning

confidence: 99%

The law and politics of transnational rights protection: Trusteeship, effectiveness, de‐delegation

Sweet

Sandholtz

2022

International trustee courts embody a specific form of delegation, in which state principals confer on such courts the authority to interpret and apply treaties agreed by the states in order to realize specific values and interests. Human rights courts help states resolve commitment and enforcement problems that are inherent in human rights treaties. This study seeks to answer the question, what happens when states parties seek to reduce or eliminate the authority of a human rights court? To answer these questions, the article assesses six human rights treaty regimes: the Council of Europe; the Organization of American States; the African Union; the Economic Community of West African States; the East African Community; and the Southern African Development Community. The article identifies four types of de-delegation possible with respect to international human rights courts and assesses the extent to which states have sought to de-delegate from them. With one exception (the SADC Tribunal), the regimes examined here have so far successfully withstood the challenge of de-delegation.

“…Here, we focus on 'institutional politicization', understood as elected politicians calling into question an original grant of powers to an IRA. We follow the definition used in this special issue—‘any sustained, public challenge to the legitimacy of an existing NMI by officials who possess some authority to override, curb, or abolish it’ (for a deeper discussion, see the introduction to this special issue, Thatcher et al, 2022). Institutional politicization can take forms ranging from attacks on an IRA's creation and powers to specific proposals and attempts to change the existing delegation.…”

Section: De‐delegation and Iras For Markets In Europementioning

confidence: 99%

“…Institutional politicization can take forms ranging from attacks on an IRA's creation and powers to specific proposals and attempts to change the existing delegation. As with the entire special issue, we examine whether, how and why institutional politicization leads to de‐delegation, which is defined as an ‘authoritative alteration—or annulment—of an existing ‘delegation contract’, in order to reduce the formal authority of the NMI to make law, regulate, or govern in other ways’ (Thatcher et al, 2022). Hence de‐delegation is a change in formal rules to curb IRAs that can include outright abolition of IRAs, reductions in their powers and/or imposition of additional formal controls either directly or through reorganizations.…”

Section: De‐delegation and Iras For Markets In Europementioning

confidence: 99%

National de‐delegation in multi‐level settings: Independent regulatory agencies in Europe

Rangoni

Thatcher

2022

Self Cite

National politicians in Europe have created independent regulatory agencies (IRAs) with significant powers over markets such as communications and energy. After delegation, they have engaged in institutional politicization of IRAs and undertaken numerous attempted or actual de-delegations. Yet overall de-delegation over the period 2000-2020 has been limited, as many de-delegations have been abandoned, temporary or reversed, and also counterbalanced by extensions of IRA powers. The article examines different explanations for this pattern. It looks especially at Europeanization, which has operated through normative and particularly coercive mechanisms. EU coercion has involved threats of legal action, monitoring and enforcement of existing EU legal requirements, and EU legislation expanding IRA powers and protection. IRAs are more vulnerable to de-delegation than trustee non-majoritarian institutions because their position can be altered with simple legislative majorities. Yet even for such agents, the ability of national politicians to reverse delegation is constrained by multi-level institutional settings.