John Ohnesorge 2016'The Regulatory State in East Asia'inComparative Law and Regulation92-106. Please refer to the attachments.

3. The regulatory state in East Asia they are gi judgment. F John Ohnesorge policy issue politics or t agency is go properly sup legislature. INTRODUCTION in power, it are delegate The societies of East Asia, which here refers to Japan, South Korea, Taiwan, and the This relati People's Republic of China (China), have followed a broadly similar path in adopting and the desi order to ave structures and methods of the regulatory state or regulatory capitalism,' a path which others, Inde continues to influence the scope and functioning of regulatory government in the comparison region. This chapter will outline ze, preferred civil servants tems, thoug to judges and emphasized informal collaboration more than it did formal process, or, in parliamen for that matter, conflict resolution. It highlights commonality well as differences among the countries within the region, and discusses historic cracies they political ma underpinnings for that path. The chapter will also explore areas where that path differs most significantly from the trajectories of the United States and of Germany, the parison to t Western systems that have had the most influence in the region. Although all elements expert in la branches. W of the regulatory state model will be discussed in the East Asian context, focus will be are all "im on legal-institutional attributes such as independent regulatory agencies and rule-based institutional governance rather than substantive policy choices such as privatization and deregula- them all as tion, though this approach treats legal institutions and substantive policies as intimately flaws of the related. This lack Studying the East Asian case in comparative perspective de impossible, of interactions, over time, between imported institutions and local social and political making cor forces. Driven primarily by the delayed establishment of competitive political systems perhaps ever and the famously close relations between economic bureaucracies and the private limitations, ! sector, the region's imported German administrative law long retained a strongly us. Even ox bureaucratic orientation. Recent developments, however, are pushing East Asian legal Republic of systems in the direction of American-style proceduralism and the more legalized theoretical I arrangements generally associated with the regulatory state. ation of pow It is important to recognize that the terms used in comparative discussions of the in fact these regulatory state and administrative law are typically relative, matters of degree and hierarel "Experts" or "technocrats" aren't expert in all questions they face, nor are all the issues The ex These terms are used interchangeably here, to describe governance systems characterize earch from by (i) reduced levels of public ownership and regulation limiting maner ca 2013) to governance of private market actors through generally applicable applicable rules and standards rather China than through informal government-business networks, or discretionary, particularistic arrang Communist F ments; and (hii) delegation of rulemaking and enforcement authority to specialized regulatory example is fo agencies insulated from dir d from direct control by the legislature or elected are or elected members of the executive operating in branch, and expected to exercise their policy-making and enforcement authority in accordance industrial pol with their expertise and in pursuit of the public interest. A useful introduction to this literature is acilitated by David Levi-Faur (2005). Chamber of ( 92The regulatory state in East Asia 93 94 Comparative law and regulation they are given to decide amenable to expert decision making devoid of political institutions and conceptual categories, and the general trend in the world seems to be PATHWAYS T judgment. Politicians, on the other hand, sometimes have substantive knowledge of toward convergence not only in form but in the actual performance of these bodies. GERMANY, A policy issues and are sometimes able to pursue the public interest, rather than party This means that it is insufficient in these discussions merely to point out the politics or their own reelection. By and large, though, a properly staffed regulatory shortcomings of one institution without exploring whether the other institution(s) that In the United St agency is going to be more expert than a legislature on many policy questions, and if could make the policy choice in question would perform any better. The appropriate Interstate Comm properly supervised, it is more likely to be guided primarily by expertise than would a question is which institution is least worst, not whether any of them have flaws. agency at the fed legislature. If the political system is competitive, with policy-based parties alternating The recent movement questioning the spread of regulatory governance and the regulatory agenci in power, it seems likely that g ater policy stability will be achieved if policy choices independent regulatory agency model (Dubash and Morgan, 2012) seems flawed for developed in a p are delegated to independent regulatory agencies relatively insulated from politics. this reason. The spread of the model can be attacked procedurally, as having been cracy but active active, and power an, and the This relative quality is true of all the terms used in discussions of the regulatory state pushed by governments and institutions of the "North" on countries of the "South," and in adopting and the design of governance institution . and it is important to keep this in mind in it can be criticized in substance as associated with the spread of "neoliberal" policy was strong but in order to avoid over-simplification, or r others. Independent a anticizing some institutions while criticizing choices such as deregulation and privatization. Both criticisms are to be expected, but this volume). In t path which the ICC was ere ient in the vil servants omparison to presidential d d insulated from politics only in they do not really address the model itself, as a governance mechanism that could be or mainline ministries in parliamentary sys- designed in many different ways and used for governing many different policy areas. It applied a relative process, or, in parliamentary system impose the legislatu nate the actual ability of elected ministers is certainly true that one goal of the independent regulatory agency model has been to and the commor differences I economic cracies they oversee. The clo olicy preferences on the bureau- regulatory appara political malfunctions, ed branches, by the same token, due to well-known achieve policy making that is driven more by expertise and less by politics than if powers were retained by the legislature or the traditional executive. However, a fair the independent 1 path differs ctions, are only representative and democratically legitimate in com- analysis should neither romanticize the wisdor n or the nature of our elected upon a critique of rmany, the parison to unelected bureaucrats or appointed judges, while courts are independent, branches, nor create a technocratic bogey-man tual independence increasingly com Il elements expert in law, and law governed in their decision making only relative to the other of such bodies from political oversight." alone. The Ameri cus will be branches. When it comes to siting decision-making authority within government, these exercise in com rule-based are all "imperfect alternatives," in the language of Neil Komesar's comparative To help us develop a framework for studying the development of administrative institutional analysis (Komesar, 1994), and serious analysis requires that we try to view legality and regulatory governance around the world, history fortunately also provides a regulation and go I deregula- them all as they actually are, not assuming the best abo discrete set of factors that can be used to make sense of important national trajectories, to the background intimately laws of the others. hile pointing out the thus facilitating cross-national comparison." That set note that in the ment of a country's (i) bureaucracy. (ii) its legal system.( President gave ko importance This lack of absolute baselines might seem to make cross-national comparison judgments about impossible, as every country's system would seem to be a tangle of particularities, and (iv) its civil society, especially its comm id political making convincing comparison impossible. Cutting the other way, cannot explain all developments (Hoogenboom an owever, and understanding al systems perhaps even demanding comparative work of this sort, is the fact that, whatever ever their the trajectories of key jurisdictions. Studying the c ICC claims that i the private limitations, they are the institutions and conceptual categories that modernity has left to their development over time in relation to one another of political influe a strongly Asian legal us. Even communist regimes such as those in China and the Democratic People's explaining convergences and divergences across different national that might ation of relatively otherwise seem unique. Section II, which folla pressure made it 3 legalized Republic of Korea (North Korea) parrot this institutional structure, despi alternatives. theoretical rejection of bourgeois legal concepts like electoral democracy and their the American and German trajectories, to which the East Asian Although the East Asian path is quite different from both the American and German Construction of ons of the ation of powers. They have created courts, legislatures, ministries, and agencies, programs, as the of degree. in fact these institutions are all infused with and dominated by Communist Party paths, the claim here is that it is closer to the latter than to the former. The remainder of Section II then explores East Asia's historical transition to Western political forms, was obviously inc I the issues and hierarchy." For better or worse, history has left us with a contained et of while Section Ill discusses modern East Asia. Section IV discusses the unique apolitical, expert questions raised by the People's Republic of China. and institutions 2 The extent and meaning of independence for "independent" nt" agencies are the subject of leading Americar haracterized commitment 2013). earch from several perspectives (Miller, 1988; Quintyn et al, 2007; Hanretly and Koop. A critique that is made in the EU context is that such bodies become too free from dards rather 100 insulated and independent is tic arrange being pushed hard to give these institutions greater autonomy from the democratically legitimated oversight. What constitu * The recent d normative question, but if such bodies are in fact highly free from political or judicial oversight the state away from regulatory immunist Party so that they can operate more according to international no purple is foreign criticism criticism of China's use of competition law to target internation national norms. A current in the EU context that may be due to the sovereign-less nature of the EU itself, and thus not "ontrol), to "steer le executive likely to occur in the typical nation-state context. pplicable rules and accordance pirating in the Chinese market. The key complain hey complaint is that China's enforcement is driver Industrial policy concerns not within the legitimate sco ction draws on Ohnesorge (2002, 2008). The framework draws on the comparative this trend, in the literature is legitimate scope of competition law, and that this facilitated by the fact that the competition authorities are not independent (United State Chamber of Commerce, 2014). istorical analysis of Alexander Gerschenkron, as it ties the role of the state, expressed in law dependent regular and regulation, to the path of economic development (Gerschenkron, 1965). public ownership.The regulatory state in East Asia 95 96 Comparative law and regulation to be PATHWAYS TO THE REGULATORY STATE: UNITED STATES, studied (Ohnesorge, 2002; Ernst, 2009). The first flowering of comparative regulation decades, Japan odies. and administrative law scholarship in the United States was thus an effort to convince it the GERMANY, AND EAST ASIA a constitution : America of the virtues of professional civil service, and of specific doctrines to govern administrative ) that In the United States, regulatory government is typically dated to the creation of the judicial review of the increasingly active administrative state.? The Although that's priate Interstate Commerce Commission (ICC) in 1887. the first independent regulatory number of aspects of the administrative state that were specific to the American other developn of competitive if corrupt democracy, strong, independent courts, an active and d the agency at the federal level (Hoogenboom and Hoogenboom, 1976). The ICC, and the China's substar regulatory agencies built on that model during the Progressive and New Deal eras, was independent bar, and well-organized commercial interests: Congress only after the d for means for checking the agencies it had created, and the doctrines of constitutional influenced by been developed in a political, legal, and social environ nt characterized by thin bureau- administrative law that developed recognized a major role for nducting Korea in the ca " and cracy but active democratic politics, a rich Anglo-Ame of inde judicial review. With respect to other features of con the basis for m policy active, and powerful courts, and a civil society in which polit ented (Schiller, there has never been significant, direct state ownership of industry in the United States Two and the U 1, but was strong but in which commercial inter this volume). In the langua ture on regulatory governance, and therefore the regulatory state did not emerge in tandem with privatization and to Taiwan, the ild be deregulation, as has been the experience in Europe, East Asia, and Latin American Guomindang (1 tas. It the ICC was created at a time when the applied a relatively light hand in steering, leaving d little rowing but also (Kelemen, this volume: 73; Levi-Faur, 2005; Dubash and Morgan, 2012). Although structures of Ta sen to and the common law courts." The Progressives thus sought to up to the market an Ameri agencies have been granted significant insulation from direct control by the elected constitutional s an if branches, the private sector has long been effective in utilizing the courts, Congress and early 1990s, fo a fair regulatory apparatus upon their critique of electoral politics as the presidency to force them toward transparent, rule-bound Although Ch ected the independent regulatory o g authority- Jence upon a critique of the effectiveness of c increasingly complex world, and upon a rejection of re egulatory tool in an In contrast to the American path, Germany's modern state was built in a nineteenth modernization, century context of authoritarian government; a much deeper bureaucratic tradition which the West alone. The American regulatory state, in other words, is best erstood as a real-world (Rosenberg, 1958); technically sophisticated but less inf than the Germs rative exercise in comparative institutional existing methods of (Stolleis, 2001; Ernst, 2009); a much greater degree of state ownership (Henderson, governance. Wi des a regulation and governance-courts, the political process, and to the background with respect to certain classes of policy decisions. It is important to were moved 1967), and a commercial class that is generally seen to be in a comparatively close a significant in relationship to the state authority (Dahrendorf. 1967). Altho government by ories, clop- note that in the American context the categories of dec tions President gave to the ICC have never been purely tech ns that Congress and the environment produced public regulatory schemes for health, acci defend democr involving as they d disability insurance (Dahrendorf. 1967) it did not produce political and k and the develo alone judgments about the reasonableness and ustice of the rates railroads charged shippers agencies on the ICC model, nor did it produce adn (Hoogenboom and Hoogenboom, 1976). By the same token, no serious student of the American sense of extensive procedural contro executive branc ading and ICC claims that it was ever truly indepen fully independent courts. Although Ger law did not err of political influences. The defense of the ICC experime was an important inspiration for co imagine how it k for night ation of relatively more expertise with ad that its con Goodnow and Ernst Freund, what probably had pressure made it better suited to make s to direct poli and ideologies. Germany's tradition of regulation by professional civil servants independent n ne of tared. alternatives. least in theory, law-governed and insulated from political pressure branches that rman Construction of a professional civil service was key to the Progressive and New Deal trative law of the time focused a great deal on ensuring legality of extremely unli inder programs, as the carlier spoils system for tate bur compared with the United States, the administration and executive branch in branches of go was already overdeveloped in comparison to the legislature or the courts. T model, there \\ arms, was obviously incompatible with the goal of a nique apolitical, expert bureaucracy. In this era the United States was the importer of ideas admittedly a limited analysis, it appears that despite enormous social and private markets and institutions from Europe, especially Germany and France, where many of th changes, German regulatory governance still reflects this legacy in its continuing com- One area in leading American proponents of regulatory government and administrat mitment to rule-bound, professional bureaucracy, but within a less institutionally frag- regulatory stat mented, less adversarial, and less litigious regulatory environment (Dwyer et al., 2000). was in its con from is a The East Asian era of modern government and law began with the legal and political right * The recent development of regulatory nce is said to involve a shift in the role o Is not the state away from "rowing" (governing through state ownership and other forms of direct reforms in Japan that followed the Meiji Restoration of 1868." Over the following three control), to "steering" (governing through the creation and imple applicable rules and standards) (Levi-Faur, 2005). The U.S. is probably best seen as an exception Arguably the leader in these efforts was Frank Goodnow, educated in Germany, whose rative the rise of latory governance and a "steering" role for the state via works addressed public policy and institutional design, as well as constitutional and adminis- n law dependent regulatory agencies did not follow an earlier phase in which the state public ownership. trative law (Goodnow, 1893, 1895, 1911). This section draws on Ohnesorge (2010).98 Comparative law and regulation The regulatory state in East Asia 97 heritage that perhaps resonates with governance by experts also cautions strongly or in Germ ation decades, Japan adopted all the fundamental elements of modern government, including against overly legalizing the relationship between those officials and the communities interventioni since a constitution and a set of European-style legal codes, a judiciary that included an they were charged with governing. Governance in traditional East Asia certainly relied branch close wer administrative court, and a two-house parliamentary legislative and executive system. more on law than some have argued, but anti-legal paternalism was emphasized over democratic J er, a legalized relations between the state and the governed. Therefore, while it may be true pushed for 1 ntext Although that system has been affected by a new post-World War Two constitution and other developments, Japan displays substantial continuity with that initial system. that East Asian cultural sympathy with government by experts adds legitimacy to the though nomi and China's substantial political and legal reforms began some four decades later, really contemporary administrative state, it is also the case that the Confucian ideal in process but rtant only after the fall of the Qing Dynasty in 1911, and in form were also primarily pre-modern East Asia was never capable of developing into an alternative vision of was involved and influenced by European models, either via Japan or directly. Japan's colonization of government comparable to the regulatory state. Given this ting Korea in the carly twentieth century meant that Japan's modernizing reforms provided surprising the ism, despite press Lates the basis for modern Korean government and law, though after the end of World War Two and the U.S. occupation Korea adopted a largely pres ntial model. With respect EAST ASIA SINCE 1950: FROM DEVELOPMENTAL TO independent and ican to Taiwan, the system developed in China prior to 1949 was br ght to Taiwan by the REGULATORY STATES? to introduce Guomindang (KMT) government fleeing the com but after ink ugh cted structures of Taiwan's legal order can still be traced to pre- Although the political, legal, and social context of East Asia into which Western attempted ins and constitutional system was substantially changed by con tion China, though the governmental forms were introduced was not conducive to modern regulatory govern- operating in early 1990s, following the lifting of martial law in 1987. nd political ance, the path dependence created by that legacy should not be overstated. East Asian coordinated i Although China and Japan differed in important resp governments were dramatically re-ordered after World War Two. To understand objectives of anth legislative nc tion modernization, it is fair regulatory governance in East Asia today, it is best to focus on post-War dynamics of which the Western lega to say that the existing social independence ons than the German one what has been called "the developmental state", though keeping in mind that those dynamics have been shaped by earlier histories. fragmented a son, lose governance. With r The East Asian developmental state is best thought of as an ideal type created by development inal a significant tradition of scholars of comparative politics and political economy ght to explain the for the regior political arrangements undergirding the region's rapid economic and the judiciary" defend democr ment from the 1950s through the 1980s." Japan, South Korea, and Taiwan provided th between the em political and legal core of the ideal type, and while they shared certain features, they differed in important the region on and the development ways as well. The most important features they shared were strong professi Western law executive bran Iministratio bureaucracies, interventionist yet pro-growth industrial policies, German-insp An imports ink law did not emerge In fact, it is hard to administrative law, restrained courts, and decades of one-party rule. In terms was that most imagine how it could h ition of forces political structure, Japan was a parliamentary democracy ruled by the Liber and ideologies. Innova cen otherwise, given the und serve as an it was the banki independent regulatory ions of the modern regulatory state such as governance through cratic Party (LDP) from 1955 to 1993; South Korea was a faux presidential demo branches that fragments horities require action by the legislative and judicial albeit with multiple parties even before it began to democratize in 1987; and until the banks in ban constrains executive power, a development which is beginning of democratization in 1987, Taiwan was ruled by the Na ist Party (the (Wade, 1990. extremely unlikely when the executive branch is unified and dominates the other branches of government. On the economic front, and also at odds with the regulatory KMT), a Leninist ruling party most comparable in form to Mainland China's Communist Party. All three countries had administra e litigation statutes creating Some di: model, there was state ownership of the economy and extensive interference with that the bureau private markets. causes of action against administrative acts that infringed i restraint meant that these were not developed through case law in ways that could have bureaucracy One area in which the law and politics of pre-modern East Asia did echo the fragmented regulatory authority by pushing the courts to the center of regulatory policy the legislature c regulatory state, specifically the phenomenon of the independent regulatory agency, making (Ginsburg, 2001; Ohnesorge, 2006)." Liberal reformers in all three coun s a Jape was in its commitment to governance by experts insulated to some degree from the sovereign. The Confucian ideal of governance through an elite bureaucracy of officials called for general administrative procedure statutes along the lines of those in the U.S. staffed via civil service exams represented a version of expertise theory, an important difference being that the content of the East Asian exams was primarily philosophical Major works in this tradition include Johnson (1982), Amaden (1989). Wade (1990). Woo and literary, not technical or practical, and that the impetus was not to insulate policy (1991). Birdsall et al. (1993), and Woo-Cumings (1999) making from the vicissitudes of democratic politics, but from the corrupting effect of Judicial restraint is probably best explained by persistent one-party rule, democratic or society, and from the whims of rulers whose authority was otherwise understood to be authoritarian, though it was not inconsistent with older German-inspired thinking about ministrative law. unified, supreme, and unchecked by law. On the other hand, the same ConfucianThe regulatory state in East Asia 99 or in Germany, but these were not enacted until the 1990s. The combination of 100 Comparative law and regulation trongl unities interventionist industrial policies and restrained courts left industry and the executive rule based, a characteristic identified with the regulatory state, due to the fact that no means beer relied branch closely entwined in all three jurisdictions," and commercial interests, even in bureaucracies were heavily staffed with law graduates, who relied heavily on legal texts as accompany d over democratic Japan, did not contribute significantly to a civil society that might have to justify their decisions. But the fact was that those regulatory texts were notoriously al., 1994; Jin, e true ished for more judicial control over the executive branch. South Korean industry. broadly worded, granting a high level of discretion, and judicial review was not often and highly cc to the ough nominally private for the most part, was a crucial player in the development used to legalize the application of those norms, even if available in theory (Boyd. South Korea, leal in rocess but ultimately under presidential control, and in Taiwan the ruling KMT itself 2003). Corporatist networks have long been identified as a key feature of the democratizing tion of was involved in the ownership of major industrial sector developmental state regulation (Pempel and Tsunekawa, 1979), and the fact that such parties are no Given this common alignment of law, politics, and econ networks were generally limited to local firms was a regular source of trade disputes though the Li surprising that the regulatory model did not emerge during the development nic interests, it is not with countries whose companies were excluded. the early 199% despite pressure for movement in that direction ental state era. independent regulatory authorities, the U.S. oo poking first at the phenome The developmental state literature has traditionally highlighted the quality of the civil minister. Gen ent had pushed Japan service, which in all three countries benefited from the extensive investment of three jurisdicti to introduce them in the 1950s, particularly in the government resources and was highly competitive and highly respected. The fact that to court struc but after independence from the U.S., Japan's leadership c ust (competition) law, ed the effects of tha bureaucracies in these countries achieved generally good policy outcomes without These develo attempted institutional innovation (Uga et al., 2009). Independent regulatory authorities either legally enshrined independence or intensive judicial review to ensure rule-bound competitive p ester governance might prompt us to ask whether such external feat administrative over- operating in areas important to the econo such as antitrust would have made review of sub Asian coordinated industrial policy much harder to achi features internal to the bureaucracy itself, especially the quality of its perso this volume b rstand objectives of all three countries. In addi counter to the policy External structural features might be less relevant than we sometin 2010), repress ics of egislative nor the executive branch had an incentive to push independence on the part of any regulatory auth for legally co with respect to the technical quality of decisions. At the ver ld certainly not assume that the place of agencies within the government developmental those relationships with the elected branches and with the courts-is sufficient to guarantee There have fragmented and reduced the power they exercised together. The same logic hind d by at the fact that the political but these app development of independent, active courts, and the lack of such courts made i the quality of their decisions. Indeed, one might speculate th in the for the region's ruling parties to maintain control over their bureaucracies, and authorities in the East Asian developmental states were confident that the bureaucrats culture as hav velop- the judiciary's ability to use administrative litigation to legalize interaction would largely do their bidding was what led them to invest so heavily in those same to obtain Inte the late 1990s ed the between the state and private actors. Institutions bureaucrats. "7 Single-party rule during this era also went hand in hand with policies to consolidat ortant the region on a path the roots of which went that were generally coherent and consistent over time, crucial to operating an Western law and political forms. interventionist industrial policy. Independent regulatory agencies are insulated from securities firm sional spired An important feature of the regulatory culture of the East Asian develop cal state politics not only so that they can exercise expertise, but also in the hopes that the autonomy," a ns of was that most industry was in private hands; direct stat nership of industry did not policies they adopt might be more stable over time than policies enacted by the elected independence. Demo- serve as an important vehicle for regulation or for red ception to this branches. The East Asian developmental states achieved industrial policy stability more 2005). Writing "[allthough th cracy, was the banking sector, especially in Korea and Taiwan, w ence over the through single-party dominance than through legally independent regulators, a fact that of the crisis, I til the banks in bank-centered financial systems created key for industrial poli complicates efforts to use East Asia as a model for a new devel Bank of Kore y (the (Wade, 1990; Woo, 1991). With respect to form, regulation in a democratic political context. China is openly anti-democratic, hina's such as Brazil that are interested in developmental state ideas are also committed to them by other 3). In Taiwan cating dicial Some dispute exists over the political active democracy (Trubck et al, 2013). Ironically, complaints of a neoliberal impos- occur until 20 at the bureaucracy was largely free from ition of the model of the independent regulatory commission seem to come from the ourcaucracy just ap same voices who want a return to industrial policy and a central state role in only one as it have the legislature did not ne 2009). The N olicy did not need to intervene. The forme development. The East Asian experience, however, might support the case for entrust confrontation ntries Presents a Japan where expert bureau ing that industrial policy to independent regulatory agencies. since the policy stability U.S. pan's economic interests. (Johnson, 1982). The latter view, asso critical to state-led development may well be undermined by party politics in a Frances Rosenbluth and Mark Ran democratic system in which parties are likely to alternate in power. . Woo well as the level and effectiveness Political change in East Asia in the late 1980s and continuing through the 1990s tic or osenbluth, 1993). The contending ushered in a new era of law and regulation, an era that is still unfolding but that has about d normativity. V brought important changes in the direction of regulatory governance. East Asia has by ess arm's-length and mo other developed democracies that gave rise and the courts Perhaps a "tragedy of the bure nobody with political authority feels a sufficient ownership interest in the bureaucracy.The regulatory state in East Asia 101 act that no means been immune to the trends toward privatization and deregulation that are seen 102 Comparative law and regulation cal texts as accompanying the turn to regulatory governance in other parts of the world (Kim, et piously al., 1994; Jin, 2006; Liou, 2010), but the process has been slow, somewhat piecemeal, [Taiwan's] contentious polity" (Yeh, 2010: 246; see also Freedom House, 2013). All Insurance Regi 1 often and highly contested. The most fundamental political changes were in Taiwan an things considered it would definitely be premature to declare that the regulatory state (Sosay and Zet model accurately captures governance in Japan, Korea, or Taiwan today. though well trained a (Boyd, South Korea, which both ended martial law in 1987 and subsequently enacted legislative or of the democratizing constitutional reforms, and in which competitive politics and alternating movement in that direction has certainly occurred. legislature is c at such parties are now firmly established. Japan's politics have arguably changed the least, is arguably ew lisputes though the Liberal Democratic Party's string of ries was interrupted in the early 1990s, and since that time the LPD has not always h THE PEOPLE'S REPUBLIC AS REGULATORY STATE regulatory rule he civil minister. Generally applicable administrative procedure statute grow alongside three jurisdictions, and there have been reforms to adm One of the first major actions of the victorious com nunists in the newly established that sector coul rent of ct that to court structures for judicial review (Ginsburg. 2001; 0 in the way of l without These developments, clearly related to democratization e, 2007a, 2010).13 People's Republic of China was the abolition of the legal system created before 1949, which from that point onward existed only as the legal system of Taiwan. The abolition country's) leax competitive party politics, have brought East Asia much clo included the closing of institutions such as courts, the subjugateon of the legal separation of F -bound flowering of judicial profession to state control, and the purging of the individual lawyers and judges who Chinese goven tant as administrative law and regulation in developed demo review of substantive aspects of administrative decision ma ly described in did not flee. Some efforts were made to build a legal system on Soviet lines during the The expertis sonnel at least his volume by Huang and Law (Huang and Law, this volume) 1950s, and had that succeeded, China's legal system would have become "adminis- 2010), represents a sea change in the role of courts a d elsewhere ureaucracy re trative" in the sense that much regulation would have been done through decrees branches, as is rtainly -their developmental state era. emanating from parts of the government other than the legislature, and in the sense that some civil ser There have also been moves to create independ bureaucracy. C irantee gencies in the region, much of the "law" would have consisted of internal norms governin Slitical but these appear not to have been as important for the region's overall regulatory and/or the Party. This is not so different from the role of law in Imperial China, w training its vas querats culture as have the political and legal changes discussed a sample, in order was often described as being nearly entirely criminal and administrative. Regulatory the public, es to obtain International Monetary Fund assistance during the ancial Crisis of state ideas such as independent regulatory authorities or indeper ent courts applying traditional gow same states. By inw olicics the late 1990s, the Korean government signed a letter of intent promising to pass a bill administrative law to state-society regulatory encounters would have been just as ng an "to consolidate supervision of all banks (including specialized banks), merchant banks, incompatible with Soviet law as it would have been in Imperial China, however, is leadership sign from securities firms, and insurance companies in an agency with operational and financial nothing could be independent from politics, as enun by the Communist Party decision makir at the autonomy," and to revise the Bank of Korea Act to provide for central b With no remaining private sector there would have been no need for government There are a independence, with price stability as the bank's main mar (Sosay and Zenginobuz, agencies to develop and then apply legal norms in order to govern society, as in the greater techno 2005). Writing roughly ten years later, regulatory state model. pation in reg more et that "(allthough they were created or reorgani China's period of building Soviet legality was short, however, and by the end of the administrative that appears cl rating of the crisis, FSC/FSS and BOK [the consolidated Bank of Korea] have not in reality func ed as such due to cons try regulator and the 1950s the efforts had been abandoned in favor of more political mo intries is imposed on bureaucratic stability. It was not until the 1980s, after the anarchic violence and the U.S. contes politics: as the ted to them by other, formal as well as informal, instit destruction of the Cultural Revolution, that China moved decisively toward governance and-comment mpos- 3). In Taiwan, serious movement toward the indep ions in Korea" (Kim and Lee, 2006: through relatively stable legal norms, some legislative and some enacted by the m the occur until 2000 (Uga et al., 2009), and a 2009 survey of a mission model did not responsive to ] n Taiwan identified bureaucracy or the Party. Although these efforts have been impressive in many ways. they have not moved China very far toward the model of regulatory government text (Wagner, le in only one as independent, the National Communication Commi however, it is Itrust- 2009). The NCC was created in 2005, and "its establishment triggered inter sion (NCC) (Uga et al., discussed in this volume. Indeed, in contrast with the past when the leadership behaved as if its long-term goal was for China to converge with international trends, recent main conflict ibility confrontations, partisan fights and constitutional court rulings again backdrop of bureaucracy hi in 3 developments actually suggest a more open rejection of the regulatory model. which therefor 1990s Japan, South Korea, and Taiwan have all enact enerally applicable adm The problem with conceptualizing China as a regulatory state is not with the idea of governance centered around regulations that emanate from the bureaucracy. In fact, this hegemony. But edure statutes that include some type of notice-and-comment process for ad it has ulemaking, See (Japan) Administrativ inistrative Procedure Act, as amended Act No. 73 of 2005, Chapter is mostly how China is governed now, as the "legislative branch"-the people's as by VI, available at: www.cas.go.jp/jp/scisakw/hourei/data/APA.pdf: (South Korea) Administrati congresses at the national, provincial, and local levels-is not democratically elected. Procedure Act, as amended January 28, 2014, Chapter IV, available at: http://claw.kiri.re.kr/eng Service/law View.do?hseg=31957&lang-ENG; (Taiwan) Administrative Procedure Act, does not possess any authority independent from the Communist Party, which also hority DATO201.asp. amended May 22, 2013, Article 154, available at: http://db.lawbank.com.tw/Eng/FLAW/FLAW controls the "executive branch," and is not considered a driver of policy. In the late 1990s China actually created an assortment of regulatory authorities mirroring the independent regulatory authorities of other countries, such as the China Securities Regulatory Commission, the China Banking Regulatory Commission, and the ChinaThe regulatory state in East Asia 103 104 Comparative law and regulation bureaucracy is perhaps the most free from control by elected politicians, but at the Dubush, Navroz .). All Insurance Regulatory Commission, certainly driven in part by its 2001 WTO accession same time the most thoroughly constrained by politics, based on the pervasive role of South." 6 Reg (Sosay and Zenginobuz, 2005). The bureaucrats who staff these bodies are increasingly Dwyer, John P. . state the Communist Party. The separation-of-powers lacunae that prevent China from being nd German nough well trained and their power to govern by regulation is not constrained by the considered a regulatory state in the modern sense are thus not unlike those which Encounters: & legislative or judicial branches: China's constitution is largely unenforceable, the legislature is considerably weaker than the combined executive/Party, and the judiciary characterized the East Asian developmental states of the past, though the governance California Pre must. Daniel R. Shipwreck. 18 is arguably even weaker, so there is little prospect of it trying to use law to constrain challenges are perhaps even more severe in the case of China. edom House. regulatory rulemaking. Moreover, China has allowed a substantial private sector to Media Bulleris grow alongside the still-important state-owned sector (Lardy, 2014), and governance of lished that sector could certainly be conducted in a rule-bound, arm's-length way. What stands CONCLUSION Herschenkron, A insburg. Tom. 1949 in the way of the regulatory model is the Communist Party, and the fact that its (and the and Korea," 4 lition country's) leadership is now openly suppressing advocacy for constitutionalism and National regulatory governance, both structures and policies, reflects the broader legal, Goodnow, Frank legal separation of powers, which suggests that the courts will not become major players in political, and economic tradition in which it is embedded. These national traditions differ in what type of role they allocate to politics cs, and law and they and Goodnow, Frank Goodnow, Frank s who Chinese governance in the foreseeable future. ng the The expertise/politics tension is experienced in China mostly within the Party- perpetuated through ideology and the actual inst Hanreity. Chris minis- bureaucracy relationship itself, rather than between the bureaucracy and the elected path-dependent histories. This phenomenon of heterogencity within a structure of basic Independence Henderson. W.O anches, as is the norm elsewhere. The Party is politics in China, and while there are similarities allows the study of comparative administrative law and regulation, reflected Liverpool Uni Berees ac that some civil servants who are not Party members, the Party thoroughly permeates the in this volume in the global trend toward regulatory governance, as a form of acracy ureaucracy. China's leadership does, however, put a great deal of resources toward comparative politics. Given its successes, East Asia, including China, nee s to be part heng- Y which training its vast bureaucracy, and clearly hopes to elevate their reputation in the eyes of of the global comparative discussion. latory the public, especially market actors. This connects the current regime to China's The importance of understanding regulatory governance in East Asia is underscored plying traditional governance ideals, as well as to the experience of East Asian developmental by the current revival of interest in industrial policy among developing countries in ast as states. By investing in the bureaucracy but not insulating it from Party politics, the Latin America and elsewhere (Trubek et al, 2013). Any program for a "new zer, as leadership signals an increase in the ratio of technical expertise to politics in state developmental state" should include efforts to design regulatory bodies so that they can Party. decision making without giving up direct control. provide policy coherence and stability within democ and largely market- nment There are also currents in China that seem to run in the opposite direction from oriented economics. East Asian jurisdictions afford significant mparative material to in the greater technocracy. For example, there are numerous experiments with public partici- assist on this score. As compared with Western developed democracies, the regulatory pation in regulation, and there are various statutes allowing judicial review of state in East Asia as a whole has evolved quite differently, and as compared with one of the Iministration action (Ohnesorge, 2006), including an administrative procedure statute that appears close to enactment after two decades of discussion in the government. In another, regulatory governance in Taiwan, Korea, Japa ina displays important id les the U.S. context, public participation in rulemaking has reduced agency insulation from differences. Looking backwards, it is understand independent regulatory e and authorities and other markers of regulatory governance did not develop anywhere in the mance politics: as the Administrative Procedure Act has been applied by the courts, notice- region until very recently. The question now is not whether East Asia will converge to y the and-comment rulemaking has made independent agency rulemaking much more ways, responsive to public input and judicial oversight, than c ed by the legislative some degree on the global trend-as explored in this chapter, it has-but the timing nment text (Wagner, this volume). In the Chinese political and institutional environment, and extent of that convergence, how it will be shaped by regional politics, how robustly democratic it will be outside of China, and how it will affect bureaucratic performance- Shaved however, it is highly unlikely that public participation will develop to this extent. The recent main conflict between politics and expertise is likely to inside the Party- bureaucracy hierarchy, particularly because the Party also infuses dea of which therefore is unlikely to emerge as a site for or challenging Party-bure REFERENCES ct, this hegemony. Bureaucratic regulation in China is thus likely to be increasingly expert an cople's technocratic until it is not-until it touches on matters of n to the Party as Party, Amsden, Alice. 1989. Asia's Next Giant. New York: Ouford University Press. at which point politics will rule. 14 In short, China can now be understood on the sam Birdsall, Nancy M, Jose Edgardo L. Campos, Chang-Shik Kim, W. Max Conden, and Lawrence MacDonald (oda), Howard Pack, John Page, Richard Suber, and Ko h also basic spectrum as East Asia's developmental states, with the importa ant caveat that its carch report. New York: Ouford University Press. he late d. Richard. 2003. "The Rule of Law or Law as Instrument of Rule? Law and the Economic ng the ment of Japan with Particular Regard to Industrial Policy," in Christoph Antons, ed, Law and " This is another way to capture w development in East and Southeast Asia. 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