This Article uses the jurisprudential dichotomy between two opposing types of legal requirements — “rules” and “standards” — to examine extraterritorial regulation by the United States. It argues that there is natural push toward standards in extraterritorial regulation because numerous institutional actors either see standards as the best option in extraterritorial regulation or accept standards as a second-best option when their first choice (a rule favorable to their interests or their worldview) is not feasible.
The Article explores several reasons for this push toward standards, including: statutory text, statutory interpretation theories, the nonbinary nature of the domestic/foreign characterization, the tendency of extraterritorial regulation to favor plaintiffs, interest-group pressures, and interbranch struggles within the federal government.
Since it appears standards are here to stay, this Article concludes by suggesting that they may have some underappreciated benefits, at least from the perspective of a regulating state. First, the uncertainty inherent in standards may be a necessary consequence of regulatory schemes permitting private civil litigants to enforce extraterritorial statutes. Second, this inherent uncertainty may permit a state’s regulatory program to influence primary behavior abroad that would be difficult to reach through a rule-based model.