On The Legitimacy Of American Extraterritorial Jurisdiction Of Financial Regulations After The Crisis-Based On The Study Of Dodd-Frank Act

The outbreak of the financial crisis has brought extensive and far-reaching influence to the world.Since the outbreak of the financial crisis,the United States has issued a series of financial regulations which included extraterritorial jurisdiction provisions to prevent systemic financial risks and to protect the interests of the investors.As the most profound act,the Dodd-Frank Act is selected by this article to analyze the legitimacy of extraterritorial jurisdiction regulations in financial regulatory field.Many regulations in the Dodd-Frank Act reflects the strong color of extraterritorial jurisdiction,especially reflected in the OTC derivatives and the banking industry.Compared to the "effect test","conduct test" followed by America in extraterritorial jurisdiction regulations in security industry,the Dodd-Frank Act directly regulates foreign people in the OTC derivatives and the banking industry and show the trends of expanding the scope of its extraterritorial jurisdiction regulations.In the field of OTC derivatives,the Dodd-Frank Act requires that anyone who deals with "the US person" and their trading capacity reaches the limit set by American regulators will be considered to be an SD or MSP and they should comply with American regulations on both the trading level and the body level whether their counterparties are American citizens or not.And in the banking sector,as long as foreign banks set up branches in the United States,its headquarters located in the home country and its other branches located in other countries must meet the requirements of the proprietary trading limit of Volcker Rule.The article attempts to analyze the legitimacy of the American extraterritorial jurisdiction regulations mentioned before in extraterritorial jurisdiction fields according to international law.Countries may assert extraterritorial jurisdiction according to the principle of territorial jurisdiction and personal jurisdiction.Permanent Court of International Justice confirmed the legitimacy of asserting extraterritorial jurisdiction based on the principle of objective territorial jurisdiction.America may not be deemed illegal in the aspect of assertion under international law.Yet the United States itself also accepted that the assertion and exercise of extraterritorial jurisdiction were issues on different level in the Restatement of the Law,The Foreign Relations Law of the United States(third).A country should still comply with reasonable limits when it exercises extraterritorial jurisdiction even it could assert extraterritorial jurisdiction according to some basis of jurisdiction.As for the standard to judge whether some country has overrun the reasonable limits of exercising extraterritorial jurisdiction,Mann,Brownlie and Akehurst separately put forward their own claims to limit the exercise of extraterritorial jurisdiction.The former two scholars advocated limiting unreasonable exercise of extraterritorial jurisdiction from the perspective of "contact",while Akehurst asserted that a country should limit the exercise of extraterritorial jurisdiction from the angle of prohibiting of abusing rights.The claims of these three academics all have their own strengths and the weakness of unclear explanation and weak interoperability.Given this situation this article attempts to find the answer from the legal theory.Dworkin put legal principles into the legal norm system while Raz,though not entirely agreed with him,admitted that part of legal principles should be recognized as legal regulations as a compromise.Akehurst advocated that legal principles were surely part of the legal regulations,and the application of legal principles must contain the proportion principle.He contended that compared to the application of legal rules in the form of to be or not to be,the application of the principle is a kind of the best command and should depend on the principle of proportionality for trade-off.This article suggests that we should use the principle of proportionality to analyze whether America has overrun the limits of international law in relation to exercising extraterritorial jurisdiction in Dodd-Frank Act with reference to three famous scholars and legal theory.As a response,China should pay attention to the trends of American expanding the scope of its extraterritorial jurisdiction and adjust our related regulations in time,carry out the coordination work bilaterally or mini multilaterally and positively deal with the effects of the American expansion of extraterritorial jurisdiction.