The New Transnational Payments Law and Global Consumer Trade: Online Platforms as Providers of Private Legal Orders
European Review of Private Law 2016, Volume 24, Issue 2, pp. 223–251.
26 Pages Posted: 24 Nov 2015 Last revised: 1 May 2016
Date Written: November 1, 2015
This article uses the example of one of the best-known global payment systems provided by an online platform, PayPal, to analyze the role of private legal orders in creating new markets beyond jurisdictional borders. It shows that a relatively uniform legal order reduces risks involved in cross-border transactions and in this way enables transnational markets. While transnational law is more easily created by private entities (like online platforms) rather than states, it remains embedded in state laws. The continuous role of state law in shaping transnational private legal orders is guaranteed because the latter operate with the endorsement and support of states. In this way states facilitate globalization. At the same time, the impact of state laws is fragmentary and disintegrates the applicable global private legal framework. Finally, the scattered influence of state laws undermines the protection offered to consumers. This is particularly important, because mutual rights and obligations between transnational private rule-makers, like the online platform PayPal, and their ‘users’ tend to be strongly biased in favour of the former.
Keywords: payments law, transnational law, online platforms, internet intermediaries, peer-to-peer payments, payment service providers, payment systems, PayPayl, e-commerce, consumer protection, two-sided markets, private lawmaking, private rulemaking, globalization
JEL Classification: D18, E42, K12, K33, L81, L86
Suggested Citation: Suggested Citation