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transplantation was to dictate acceptance of foreign law. In the contemporary world, adoption dictated by military occupation or colonization is rare, although adoption in developing counties dictated by other means, such as economic or diplomatic pressure, is not uncommon. China accepted certain unfavorable rules and conditions imposed by powerful trading partners in the process of negotiating for its membership in international organizations.36 Facing an established international market and regulatory regimes, China had to comply with externally imposed requirements and standards, including inspections and reviews by foreign agencies. To participate in the global market and export China-made products, China had little choice. Because of the pressure of this model, a recipient country often becomes the victim of economic, political, ideological, and diplomatic confrontation while reflecting the intrinsic demand for globalization and harmonization of the international legal framework; this type of legal transplantation is very common.
The Entrepreneurial Transplant This model refers to individuals and groups who reap benefits from investing in, learning about, and encouraging local adoption of a foreign legal system. Its success depends on an exporter willing to provide capital and an importer interested in the import, each side guided by what it might gain domestically by operating internationally.37 In tandem with China’s opening to the outside and economic development, economic entities ranging from large state-owned enterprises to small private companies want to participate in international investment and trade, resulting in direct contact with foreign companies and acceptance of foreign rules. For example, all Chinese companies (both state owned and private) must follow foreign rules when they intend to participate in a foreign securities market. Some enterprises directly apply foreign commodity standards or labor standards in order to export their products to particular countries. Products with quality below the standards of the importing country have no chance of entering the market; labor safety standards (such as safety protection and work environment) below a legal requirement in the importing country may result in the blockade and boycott of the exported products. Some scholars claim that legal transplantation through private actors, by borrowing law through private contracting, has formed another type of transplantation. Through the channel of contracting, private transactors “smuggle” law across borders.38 As a large export-oriented trading country,
36 Pitman B. Potter, Globalization and Economic Regulation in China: Selective Adaptation of Globalized Norms and Practices, 2 Wash. U. Global Studies L. Rev. 121–25 (2003). Potter analyzes the demands for China to adopt the principles of transparency, uniformity, national treatment, nondiscrimination, and compatibility with WTO rules, as well as the demands for certain rules and mechanics in the areas of trade, service, intellectual property rights, foreign exchanges, customs, independent courts, and dispute settlement. 37 Miller, supra note 4, at 849–50.
38 Li-Wen Lin, Legal Transplants through Private Contracting: Codes of Vendor Conduct in Global Supply Chains as an Example, 57 Am. J. Comp. L. 713–14 (2009).