Legal Studies Research Paper Series Vol. 12, No. 4

The Faculty has published Volume 12 Number 4 of the University of Cambridge Faculty of Law Legal Studies Research Paper Series on SSRN.

This issue includes the following articles:

Bobby V. Reddy: The Emperor’s New Code? Time to Re-Evaluate the Nature of Stewardship Engagement Under the UK’s Stewardship Code (10/2021)

John Kingman’s review of the Financial Reporting Council (FRC) doubted the effectiveness of the UK’s Stewardship Code in encouraging informed and engaged stewardship by institutional investors of the companies in which they invest (issuers). Accordingly, the FRC published the Stewardship Code in 2020 in a final opportunity to prove its effectiveness and relevance, and, in particular, enhance issuer-specific engagement by institutional investors. The up-date has enhanced the reach and substance of the code. However, the legal, regulatory, contractual and competitive environment in which institutional investors exist will constantly forestall soft-law attempts to foster greater issuer-specific engagement, a point perhaps tacitly acknowledged by the 2020 Stewardship Code with its wider scope. Instead, in relation to engagement, stewardship disclosure should focus on the types of engagement that institutional investors are motivated to exercise in practice, such as engagement in response to hedge fund activism, and engagement on systemic risks.

J S Liptrap: British Social Enterprise Law (11/2021)

The community interest company (CIC) is designed for private actors seeking to engage in pro-social entrepreneurship and investment for public benefit. Although the UK introduced the CIC in 2005, it has not received any serious academic treatment to date. In this article, I argue that this is a mistake for three reasons. First, an analysis of the CIC gives us a deeper understanding of how politics, specifically welfare state politics, can catalyse the production of corporate rules. Second, the CIC is an example of how corporate law can be engineered to achieve objectives other than the promotion of shareholders’ interests. Third, because the CIC’s political economy manufactured a new and unfamiliar type of corporation with its own unique regulatory infrastructure, it opens another avenue of inquiry into the wider literature on corporate theory. These insights have some broader implications for future debates about the trajectory of UK corporate law.

Kenneth Armstrong: (Br)Exit from the European Union – Control, Autonomy and the Evolution of EU Law (13/2021)

(Br)Exit from the European Union offers a novel interpretation of the United Kingdom’s withdrawal from the European Union (EU). Rather than emphasising the rupture and the exceptionalism of ‘Brexit’, this paper argues that much can be understood about the evolution of EU law through the experience of the UK’s membership and eventual withdrawal from the EU. Part A evaluates whether the legal history of its membership – its encounter with EU rulemaking and adjudication – can explain the UK’s preference for a ‘differentiated membership’ of the EU and eventual demands for control over its own laws. Part B focuses on the Article 50 TEU withdrawal process. It underscores that compliance with ‘constitutional requirements’ throughout the Article 50 process evidences co-evolution of the EU and domestic constitutional and legal orders even up to the moment of withdrawal. Part C projects forward to the evolving future relationship. It suggests that as the UK asserts its sovereignty outside of EU legal and institutional disciplines, the EU wants protection for its own autonomy.

Catherine Barnard & Emilija Leinarte: Mobility of Persons in the New UK-EU Relationship (12/2021)

The UK’s two-tier immigration system ((1) free movement for citizens of the EU and (2) controlled migration from the rest of the world) has now ended. Mobility rules post-Brexit have resulted in a three-tiered system of rights: (1) those with settled status; (2) those covered by the EU-UK Trade and Cooperation Agreement (TCA) who will enjoy limited mobility rights as part of trade in services liberalisation commitments between the UK and the EU; and (3) the rest who will compete for access on the basis of their skills. The TCA cements the transformation of the UK-EU relationship from one of a union of states tied by a common supranational citizenship to that of an economic partnership. The mobility regime under the TCA reflects this new dynamic: there no longer exists a stand-alone right to move; instead mobility is a composite part of trade. Trade-related mobility, however, is not new in international relations; in fact, it is a global right under the WTO’s GATS agreement. The question for this paper is whether the new UK-EU mobility framework under the TCA provide for a more generous mobility regime given the unique UK-EU history and geographical proximity or is it merely re-establishing what is available under the WTO rules between any, even the most distant, trading partner? The working paper tries to answer this question, using a case study of musicians, to consider how the TCA’s rules affect this particular, highly mobile group.

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