07/01/2013 03:13 pm ET Updated Aug 31, 2013

Thinking Locally, Acting Globally

Review of The Electronic Silk Road: How The Web Binds The World Together In Commerce. By Anupam Chander. Yale University Press. 278 pp. $28.00.

The information and services delivered on the World Wide Web generate jurisdictional conflicts, Anupam Chander, a Professor of Law at the University of California, Davis, reminds us. Should the rules for users be set by the corporate entity's country of origin? The country of reception? The United Nations, the World Trade Organization, or some other international organization? Or by an agreement between the provider and user of the services?

In The Electronic Silk Road, Chander addresses these questions. Making a compelling case that efforts to stop the inflow of electronic information across physical borders is certain to be futile, he recommends that governments respond to cross-border Internet-based trade in information and services by using an approach he dubs "glocalization." It involves "rationalizing their laws wherever possible, engaging in international standards projects and recognizing the adequacy of certain foreign standards and enforcement, while not jettisoning efforts to insure that net-work providers comport their service with local public policy." Chander offers glocalization as a starting point. He acknowledges that it leaves room for evasion, conflict over enforcement, and, most importantly, "does not answer difficult questions" about when to choose to honor local standards and when to insist on applying international standards.

The book provides fascinating case studies of the dynamics, dangers, and complexities of the new frontier in digital trade. Some years ago, Chander indicates, Yahoo! ran afoul of French laws declaring it a crime to invoke or glorify Nazism or display or exchange Nazi memorabilia. Yahoo!'s search engine allowed users to locate the web sites of Holocaust deniers and participate in auctions at which Nazi materials were bought and sold. Noting that effective filtering mechanisms were available, a French court required Yahoo! to block French residents from viewing the relevant sites. If it did not comply, the corporation faced an injunction, financial penalties (100,000 francs per day) and criminal charges.

Yahoo! sought relief in U.S. courts. A divided panel of eleven Ninth Circuit court judges dismissed the case for lack of jurisdiction over the French defendants, leaving unresolved "the fundamental issues about international conflicts in cyberspace." Chander lists some of them: Does the First Amendment protect Yahoo! from having to comply with foreign censorship orders? Would accepting French intervention launch "a parade of requests" to remove material from other countries, including China, Singapore, and Saudi Arabia? Would bowing to the penal code in France have "spillover effects" on American citizens, by limiting the access of individuals who use IP addresses of French providers or communicate over the Internet in French? On the other hand, Chander does not adequately delineate the content of the international law rule he appears to support that "would allow France to rightfully insist on applying its hate speech regulations to Yahoo!'s U.S. operations only where they pose a substantial harm in France."

Chander ends his book with the intriguing suggestion that the World Trade Organization might be well suited to settle disputes over trading in cyberspace. When Antigua tried to become the Las Vegas and Atlantic City of online gambling and its operations were shut down by the United States for violating the Unlawful Internet Gambling Enforcement Act of 2006, he points out, the dispute made its way to the WTO, which accepted the American claim that online betting promoted underage and addictive gambling, and abetted fraud and money laundering. Significantly, however, the WTO granted Antigua the right to retaliate. It suspended Antigua's obligation to conform with U.S. intellectual property rights, allowing "free copies" of movies and music to be made, up to $21 million, the estimated amount of revenue lost from online gambling on horse races (which, after all, is permitted in the United States).

Chander even dares to hope that one day the WTO will dismantle a local regulation because it conflicts with human rights law. China's General Agreement on Trade in Services (GATS) accession schedule, he notes, includes some promises of market access and national treatment for cross-border services that could justify such a ruling. He suggests as well that the WTO could act to ensure that policies that purport to advance public morals comply with "basic and universally accepted principles of free speech."

He knows, of course, that neither GATS nor the WTO, nor any other international organization, will bring twenty-first century copyright infringers like Pirate Bay to heel, or protect the medical records of patients as they travel halfway around the world, any time soon. Nor will they be able to get rid of the entrenched restrictions of repressive regimes. And his wish to "nurture a corporate consciousness among information service providers about their role in liberation or oppression" is, at best, only a first step toward "harmonization" and "glocalization," thinking locally and acting globally, on an electronic silk road that is, at once, easy to navigate, and loaded with land mines.