Lawyers, law firms and the stabilization of transnational business

Globalization is having profound effects on the practice and the organization of law. In the field of cross-border transactions the role of the state and its legal system has diminished such that private ordering through contracting is now the key mode of lawmaking. The vast majority of private ordering is undertaken by large law firms with international practices. Moreover, these law firms tend to adopt Anglo-American common law principles when putting together transactions. Yet within Europe there is competition from the law firms of the civil law countries, which are becoming adept at identifying markets not fully taken over by the American and English firms. But in order to understand the roles of lawyers in such cross-border transactions, we start from Abel and Lewis' question: what is that lawyers do? By using a number of case studies of transactions and disputes, we attempt to theorize how it is that lawyers create enabling and support structures for transnational business. We draw on Luhmann's ideas of stabilization of expectations and Gilson's depiction of lawyers as transaction cost engineers to help explain our findings