16 No. 67 JUSTICE It would not wait for the problem; it would prevent the problem arising in the first place. Legislative Modelling BDS naturally invites consideration of anti-boycott legislation. The traditional distinction has been between the scope to regulate public and private bodies. Politically, it is the former that is regarded as in-scope.25 This distinction was laid bare in the PSC decision. The UK Supreme Court considered the status of the LGPS and, by a narrow 3:2 majority, concluded The contributions of the employees into the scheme are deducted from their income. The contributions of the employers are made in consideration of the work done by their employees and so represent another element of their overall remuneration. The fund represents their money…. [I]t is not public money.26 The UK government’s commitment27 to addressing do-it-yourself boycotts against Israel pre-dates the Supreme Court decision in PSC, so at the time of writing it remains to be seen whether the legislation will seek to address the“public money” issue highlighted by that decision. The reallocation of private capital equally has the potential to be of strategic concern to the UK government. The homemade foreign policy decision by Ben & Jerry’s reflected negatively back on to one of the UK’s premier multinationals and, inescapably, on“brand Britain.” Liberalized markets may frown upon government interference but overriding government policy has always featured. For example, the Cluster Munitions (Prohibitions) Act 2010 creates a criminal offense for assisting in the development of the prohibited munitions. This is widely interpreted to mean a prohibition on direct investment. Although indirect investment does not appear to be covered by the act, the UK government is looking to address the issue of indirect financing, perhaps through a voluntary code. For the purposes of this article, the point is that there is political appetite to set parameters around private investment decisions. Bribery is another example. It is a fact of business life in many markets, but as a matter of policy the UK government has legislated against it. In fact, in certain circumstances it draws parent companies into its net for the acts of their subsidiaries. Further, the policy underlying U.S. state and federal legislation in this area is to protect the integrity of foreign policy. An alternative approach is to define BDS in terms of economic terrorism, and therefore a matter of national security. Framed in those terms, it is less susceptible to partisan politics as governments come and go and has more political reach into the private sphere. In a UK context, how legislation is framed is important for very different reasons to those of the U.S. A significant percentage of the world’s investable (and divestible) capital flows through companies established in British overseas territories, such as the Cayman Islands.28 As their relationships with the UK evolve, Westminster tends only to legislate in areas that are reserved to the UK, such as foreign policy and national security. Anti-boycott legislation is likely to occupy the grey area between reserved and devolved matters. It is therefore important that any legislation is properly characterized as a tool of foreign policy and national security. Conclusion It is tempting to conclude that anti-boycott legislation is the much-needed response to the exploitation by BDS activists of a flexible body of financial services law in England and Wales. The reality is more complex. Existing 25. In the UK, see, for example, Crown Commercial Service, “Procurement Policy Note: Ensuring compliance with wider international obligations when letting public contracts,” Information Note 01/16, UK CROWN COMMERCIAL SERVICE, Feb. 17, 2016, para 1: “This [Note] sets out contracting authorities’ international obligations when letting public contracts. It makes clear that boycotts in public procurement are inappropriate, outside where formal legal sanctions, embargoes and restrictions have been put in place by the UK Government.”Available at https://assets.publishing.service.gov.uk/government/ uploads/system/uploads/attachment_data/file/500811/ PPN_on_wider_international_obligations.pdf 26. Supra note 20, para. 30, per Lord Wilson JSC. 27. Cabinet Office and The Rt Hon Oliver Dowden, “Government confirms commitment to preventing public institutions setting up their own international boycotts,” GOVERNMENT, Dec. 19, 2019, available at https://www.gov. uk/government /news/government -confirmscommitment-to-preventing-public-institutions-settingup-their-own-international-boycotts 28. Colloquially referred to as “tax havens,” but this is a solecism that fails to understand their vital role in an interconnected global economy.
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