“The EU is not generally thought as an aggressive economic hegemon (…), but in sector after sector, it has set the rules for the world economy,” writes Alan Beattie in his review for The Financial Times of The Brussels Effect, the recent book by Columbia Law School Professor Anu Bradford. Bradford’s book traces back “the Brussels effect,” a term she coined for European Union’s ability to set global standards for industrial and financial rules and regulations.
“The ‘Brussels effect’ ", Beattie explains, "is well known in old-economy industries like chemical and cars (…) Companies adopt the rules as the prices of participating in the huge EU market, and then impose them across their global businesses to minimize the cost of running separate compliance regimes.” But the impact of EU regulations can also be felt in the data technology sector. Beattie provides examples from Bradford’s book, stating that, “Apple, for example, followed the rules as the price of operating in the EU and then decided to adopt those principles globally. Other governments have increasingly drawn inspiration from the GDPR [General Data Protection Regulation] model.” “GDPR is becoming a model for some US states because the federal government has failed to create its own system.”
Beattie also discusses the problems and limitations Bradford has found to “the Brussels effect.” “Where markets are what she calls ‘divisible’ and companies can maintain different standards in each, the effect is weaker. A company producing in several countries may keep in the same EU environmental regulations throughout, but get away with different employment practices depending on the jurisdiction.” Beattie also notes China's threat to Brussel’s continued dominance. China is both a major producer and consumer and strives to promote its own export standards in some areas, such as in facial recognition. “We cannot assume the future will look like the past,” Beattie concludes.
Please click here for the full Financial Times January 27, 2020 article.
Anu Bradford's research project on the international impact of EU regulations is part of the Jean Monnet Centre of Excellence at Columbia University's European Institute, which receives support from the Erasmus + Programme of the European Union.
