Private and public in the design of commercial law: Lessons from the history of bills of exchange

Abstract

This chapter provides a historical perspective on the interaction between private and public actors in the area of commercial law, to identify lessons about an appropriate design of commercial law. Historically private actors generally have borne responsibility for creating rules to regulate their transactions whereas public actors often have supported and subsequently codified this private regulation. A central theme in this contribution is whether private actor solutions need public actor intervention to thrive. Although public actor intervention might not be necessary per se for clarity, predictability and the wide use of private actor solutions, that still leaves the possibility open that public actor intervention still might have those effects on private actor solutions. The history of bills of exchange is used to address these questions, because it provides a vivid interaction between private and public actors. It will be concluded that from a historical perspective, private actors appear to be pre-eminently suited to creating relevant legal rules, regardless of the level-local, regional, global-where these rules are used, provided a relatively efficient enforcement mechanism exists. Although it can be assumed that public actor intervention will generally create more legal certainty for a private actor solution, the actual effects of this legal certainty are very difficult to establish. Moreover, public actor intervention does not appear to be necessary per se for a wide use of clear and predictable private actor solutions.