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JOURNAL OF ZHEJIANG UNIVERSITY  2021, Vol. 51 Issue (6): 201-214    DOI: 10.3785/j.issn.1008-942X.CN33-6000/C.2021.04.284
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The Spillover Effect of Treaties on Business Actors
Li Boxuan
School of International Law, China University of Political Science and Law, Beijing 102249, China

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Abstract  States are a basic subject of international law, and they are also the commonest parties to treaties. As a state enters into a treaty, the obligations in the treaty shall be directly assumed by the state. However, the objective of a treaty is often achieved with the help of non-state actors. Under such circumstances, when implementing the treaty domestically, the contracting states need to transform their obligations in the treaty into the regulation of their domestic actors including the business actors.In accordance with the traditional theory of the law of treaties, the preconditions for the binding force of a treaty on the business actors of the contracting states are that the treaty must be adopted, come into force and be implemented domestically by the contracting states. In other words, such binding force can only be indirectly established by a 2-phase effect conduction from treaties in force to contracting states and then from contracting states to business actors. However, this article explores another possible way that a treaty can influence business actors, which is called the spillover effect. The effect reveals that even if a treaty temporarily or finally fails to be adopted, come into force or be implemented domestically by the contracting states, it is still likely to have direct and de facto binding force on business actors. The effect may occur anytime prior to the domestic implementation of a treaty.There are two main reasons for the occurrence of the spillover effect. The first one is the regulatory threat brought about by an imminent treaty. Before the aforementioned effect conduction is established, an imminent treaty is to business actors a signal of regulatory threat encouraging them to resort to self-discipline. The other is the business actor’s instinct of seeking benefits and avoiding disadvantages. Self-discipline by business actors prior to the establishment of the aforementioned effect conduction results from the benefits of participation that they may have. Business actors can take the initiative of regulation and build a good image by such preemption strategies.Interests of states are inherently conflicting, so it is usually not easy for states to cooperate. As for treaties, such difficulty in cooperation manifests itself as difficulty in concluding a new treaty, obstacle for a treaty to coming into force and abandonment of a treaty in force by the contracting states. The spillover effect signifies that even a treaty that does not go through the whole process of adoption, coming into force and domestic implementation still can have direct and de facto binding force on business actors. The effect is useful in breaking the current predicament of treaty-based governance. Additionally, in the aforementioned effect conduction, business actors have to passively accept the obligations imposed on them by the contracting states. By contrast, in the context of the spillover effect, business actors are treated as both the subject and the object of governance. The union of the dual features of business actors helps to improve the regulatory effectiveness of treaties on them.Nowadays China is taking an active part in the negotiation and conclusion of a series of treaties, which reflects its attempt to make its voices heard in the international community. The spillover effect provides China with a new way of participating in global governance by virtue of treaties. So as to trigger the spillover effect and take full advantage of its values in breaking the predicament of treaty-based governance and improving the regulatory effectiveness of treaties on business actors, China is supposed to increase the exposure of treaties in progress and make the best use of international soft law as a prelude to treaties.
Key wordsspillover effect      business actors      effectiveness of treaties      global governance     
Received: 28 April 2021     
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Li Boxuan
Cite this article:   
Li Boxuan. The Spillover Effect of Treaties on Business Actors[J]. JOURNAL OF ZHEJIANG UNIVERSITY, 2021, 51(6): 201-214.
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https://www.zjujournals.com/soc/EN/10.3785/j.issn.1008-942X.CN33-6000/C.2021.04.284     OR     https://www.zjujournals.com/soc/EN/Y2021/V51/I6/201
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