On March 31, 2022, Pamela Coke Hamilton, Executive Director of the International Trade Centre delivered the keynote speech at the launch of the new Center on Inclusive Trade and Development at Georgetown Law.

Disclosure in decentralized finance is an area where founders’ and regulators’ interests can overlap in important ways. Market participants need to differentiate their dapps to compete and grow—just as regulators have long demanded transparency in order for people to know what they’re buying. But adapting disclosure frameworks popularized in the 1930s to today’s digital marketplace requires bridging decades of technological evolution and fundamentally alien assumptions about market infrastructure.

This white paper contributes to that work. It observes that DeFi presents novel policy questions for disclosure because much of the material information required to participate in an informed way is already available to technologically sophisticated actors on blockchains.

Conceptualized in the context of the Deregulated Finance Seminar in Barbados, co-hosted by the IIEL and the Barbados Financial Services Commission in February 2020, author Tim Swanson, Head of Market Intelligence at Clearmatics, assesses global trends in financial technology (fintech) investments over the last decade.

In this short IIEL Issue Brief, Swanson discusses potential reasons behind the waning interest in fintech investments after an initial spike in enthusiasm around 2015. Through graphs and statistics, he de-mystifies preconceived notions surrounding fintech and raises important questions regarding the future of the sector.

On Thursday, March 5, Tom Graham, World Trade Organization (WTO) Appellate Body Member and Chair until December 2019, delivered the 4th Annual John D. Greenwald Memorial Lecture: “The Rise (and Demise?) of the WTO Appellate Body”. The lecture took place in the context of the Georgetown Law Office of Executive and Continuing Legal Education’s Annual International Trade Update. Mr. Graham’s speech provides his insight on the Appellate Body and the reasons for how we got today’s impasse. His observations and conclusions provide a new starting point for discussions on a potential way forward for global dispute settlement.

DeFi – ‘Decentralized Finance’ – is the latest buzzword in the world of FinTech, RegTech, cryptocurrencies and digital assets. Yet little is really known about its meaning, legal implications and policy consequences. In this IIEL Issue Brief, authors Dirk A. Zetzsche, Douglas W. Arner, and Ross P. Buckley introduce DeFi, put DeFi in the context of the traditional financial economy, connect DeFi to Open Banking and end with some policy considerations. This paper argues that decentralization has the potential to undermine traditional forms of accountability and potentially erodes the effectiveness of traditional financial regulation and enforcement. At the same time, where parts of the financial services value chain are decentralized, there will be a reconcentration of a different (but possibly less regulated, less visible and less transparent) part of the value chain.

DeFi regulation supervision could and should focus on this reconcentrated part to ensure effective oversight and risk control. Looking more broadly, decentralized finance offers the potential for an entirely new way to design regulation, building regulatory approaches into DeFi as a design feature, potentially decentralizing both finance and its regulation: the ultimate expression of RegTech.

In this IIEL Issue Brief, Professor Jennifer Hillman, former WTO Appellate Body member, discusses three approaches to fixing the WTO's Appellate Body. The very existence of the World Trade Organization (WTO) dispute settlement system is in peril, threatened by a decision of the Trump Administration to block the appointment of any new members to the dispute settlement system’s highest court, its Appellate Body. Under the WTO rules, the Appellate Body is supposed to be comprised of seven people who serve a four-year term and who may be reappointed once to a second four-year term.

However, the Appellate Body is now down to just three members due to the United States’ blockage of any process to replace those whose terms have expired—and three is the bare minimum number of members necessary to rule on an appeal.  Moreover, the terms of two of those three remaining members will expire in December, 2019, leaving the Appellate Body unable to complete any appeals.  In the absence of a functioning Appellate Body, the WTO’s highly regarded dispute settlement system could grind to a halt.  Is the United States’ blockage of any process to appoint new members to the Appellate Body putting us at risk of turning every individual trade dispute into a “mini-trade war”?

World Trade Organization (WTO) Members have been unable to agree on the appointment of new members to the seven-person Appellate Body (AB) in a timely fashion, given the recent expiration of two members' terms and another member's resignation.  There has been no consensus to even begin a process to fill these posts, creating further problems for the selection and appointment of incoming Appellate Body Members (ABMs).  As a result, the WTO faces mirror issues over the transition from “outgoing” to “incoming” ABMs, threatening its very functioning and effectiveness.

This IIEL Issue Brief, a product of discussions between IIEL faculty, students and stakeholders, provides a solution to the problem without taking sides in the debate over whether the Appellate Body’s current practice of appointing hold-overs is or is not permissible under the current rules.  It proposes a single amendment to the DSU that represents a compromise—limiting the use of hold-overs while creating incentives for the timely replacement of ABMs whose terms of office are coming to an end.

Critics of bilateral investment treaties and investment chapters in trade agreements have increasingly argued that these accords can undermine a state’s sovereign “right to regulate” and limit the “policy space” available to governments, undermining the public interest.  In this Issue Brief, Simon Lester and Bryan Mercurio argue that governments should veer from simple carve outs and adopt broader “general exceptions” strategies in order to better protect legitimate public welfare measures.

In May 2017, U.S. Commodity Futures Trading Commission (CFTC) Chairman J. Christopher (Chris) Giancarlo announced the launch of LabCFTC as part of an effort to modernize the agency and serve as a focal point for grappling with unprecedented waves of financial technology innovation impacting markets.  To lead the work, he appointed Daniel Gorfine the initiative’s Director and the agency’s Chief Innovation Officer.

In this IIEL Issue Brief, Director Gorfine outlines the CFTC’s Fintech Agenda, and shares a number of current and forthcoming projects that collectively provide a blueprint for the agency’s digital upgrade.  Mr. Gorfine’s remarks are accompanied by a prologue by IIEL Faculty Director Chris Brummer.

In this IIEL Issue Brief, delivered by Ambassador Alan Wolff as the 2017 Greenwald Lecture during Georgetown Law’s 2017 Annual International Trade Update, Alan Wolff examines the legal system governing trade—both the rules in international agreements and those by statute—and argues that the United States and the world should be prepared for current institutions, international arrangements and domestic processes, like large financial institutions under Dodd-Frank, to be “stress-tested” by unanticipated forces and developments.  But in contrast to financial regulatory stress tests based on stylized economic models, the tests facing trade may well be operationalized through the real world adoption of trade measures that depart significantly from longstanding norms and expectations.

In this IIEL Issue Brief, Professor Jennifer Hillman argues that, as currently described, the plan’s taxes on imports are a clear violation of WTO rules and the rebates or exclusion from taxes for exports could pose challenges as well.  As a result, the plan risks significant litigation, retaliation from our trading partners, possible additional duties on U.S. exports, and carries the potential to start a trade war.  Therefore, reforms to the corporate tax system should be scrutinized and undertaken carefully.

IIEL’s inaugural Issue Brief on Shadow Banking was penned by Amias Gerety, then-Acting Assistant Secretary for Financial Institutions, U.S. Department of the Treasury. He argues that first, that policymakers should adopt a narrow definition of shadow banking, and second, that the analysis of shadow banking is a necessary part, but only a part, of the work required to understand and monitor the risks and frailties in an evolving financial system. He attempts to moves the debate about “what is shadow banking?” away from an emotional argument fueled by the sense that “shadow banking” is a pejorative term, and instead towards an analytical, activities-based discussion about the elements of particular financial activities and whether those elements collectively pose similar risks as banking. He also elucidates appropriate policy responses, acknowledging that the risks of financial activity have many forms and that the appropriate responses to those risks should also have many forms.