Lawyers as Sanctifiers: The Role of Elite Law Firms in International Business Transactions

Globalization has fundamentally accelerated and altered business transactions. The search for low labor costs and cheap raw materials has led to a proliferation of international transactions, and large, international law firms are called on to participate in complex transactions helping business tap into sources of finance around the world for investment. This article first examines the theoretical underpinnings of international legal practice, taking into account the historiography of U.S. and U.K. law firms. Part II describes the economic and political factors behind law firms’ rise. Part III analyzes the success of the common law, as expressed through contract, at the expense of civilian codes. Part IV examines how international law firms have capitalized on their growth and success. Part V draws upon Luhmann’s sociology of law to begin to explain how law firms achieve their aims by creating supporting and enabling structures for business. Part VI highlights a case study of the creation of a legal investment device, the U.K. Pfandbriefe. The conclusion suggests some ways of bringing these diverse strands together that explain law firms’ roles in international business transactions through the management of uncertainty and stabilization of expectations.