Federal Incorporation Research Articles

Delaware’s Dominance, Wyoming’s Dare. New Challenges, Same Outcome?

Despite an increased criticism, Delaware’s dominance has not been experiencing a significant decline: as of today, 67.8% of Fortune 500 companies are still incorporated in this jurisdiction. Nevada is known as Delaware’s most important competitor, with an aggressive strategy that overrode the effort of any other jurisdiction. Yet, its success has been limited to a specific market segment: small firms with low institutional shareholding and high insider ownership. Scholars suggest several explanations for both the rise and the staying power of Delaware. These explanations are essentially subsumed under the credible commitment theory and the network theory. According to the former, investors rely upon Delaware commitment towards the business community; whilst the latter emphasises how Delaware is profiting from the position achieved. The credible commitment theory and the network theory sometimes overlap and combine. Both predict that Delaware is hard to dethrone. In recent years, commentators have argued that this hegemony might be endangered by two different threats: the migration of cases induced by Delaware courts’ response to overlitigation; and the invasive growth of federal regulation—in particular, the possible introduction of a federal incorporation. Yet, criticism and predictions on Delaware’s decline are recurring and always follow the same pattern. Unsurprisingly, the migration turned out to be marginal; and the debate on a federal incorporation was revived in conjunction with a political campaign but fizzled out afterwards. I contend that a mounting challenge to Delaware’s dominance is mostly going off the radar. Wyoming is targeting a new segment of the market for corporate charters: i.e., cryptocurrency businesses. This jurisdiction is attempting to attract these incorporators by enacting liberal legislation and providing their companies with a safe harbour. Wyoming’s aggressive stance provides the motivation to canvass causes and consequences, criticism and challenges to Delaware’s dominance. The investigation might generate insights as to why Wyoming’s strategy will succeed or fail. In fact, this market segmentation approach is the same tactic that Nevada adopted, though Wyoming is applying the strategy to a sector that has meaningful growth potential and is pushing it to the point of introducing exemptions to state securities laws and banking regulation. The application of the credible commitment theory and of the network theory to Wyoming’s approach suggests that the strategy of building a reputation and proving a commitment to tech-incorporators is correct but is also conditioned upon a confluence of events which also needs time. Wyoming should develop an expertise that is too costly to be easily replicated by other jurisdictions and earn a share of the charters market before federal legislature and regulatory bodies pre-empts Wyoming’s law for cryptocurrencies. To the extent that Wyoming’s strategy proves to be effective, it will gain this jurisdiction the lead only in the blockchain segment of the market, whilst Delaware will continue to dominate the rest of it. In light of all this, Wyoming’s approach might be a dare. Yet, it is also the most promising—maybe the only possible—strategy to challenge Delaware’s dominance at the present time. (27(1) Fordham Journal of Corporate & Financial Law forthcoming 2021) See also https://www.law.ox.ac.uk/business-law-blog/blog/2021/03/delawares-dominance-wyomings-dare-blockchain-companies-and-market

Not Just Doctrine: The True Motivation for Federal Incorporation and International Human Rights Litigation

The legal status of international human rights litigation under the Alien Tort Statute (ATS) has been the subject of much debate, culminating in the Supreme Court’s decision in Sosa v. Alvarez- Machain, 542 U.S. 692 (2004). The debate has been almost exclusively doctrinal and has focused on the Judiciary Act of 1789, the historical treatment of the law of nations as general or federal common law, the evolution of the Supreme Court’s international law jurisprudence, and the integration of customary international law (CIL) into the domestic legal system. This Article argues that the focus on doctrine masks underlying international relations theory assumptions that are the true motivations of the federal incorporation of CIL and international human rights litigation under the ATS. One cannot evaluate the desirability of the federal incorporation of CIL and international human rights litigation in U.S. courts without having a theory of the operation of the international system, the motivation for state behavior in international politics, and the efficacy of international law as a coercive instrument. Proponents of the federal incorporation of CIL and international human rights litigation implicitly rely on social constructivism, democratic peace theory, and institutionalism — international relations theories that motivate a universalist theory of international law. The universalist theory holds that international law has an independent, exogenous affect on state behavior. Since States obey international law out of legal obligation, universalists tend to encourage the greater integration of CIL into domestic legal regimes and the use of CIL to improve human rights practices around the world. Therefore, the desirability and efficacy of the federal incorporation of CIL and international human rights litigation under the ATS depends on the explanatory power of specific international relations theories and the strength of the universalist theory as the appropriate conception of international law. This Article directly engages the universalist theory of international law and the underlying international relations assumptions upon which proponents of federal incorporation and international human rights litigation under the ATS rely. The Article examines a competing international relations theory and alternative conception of international law that views compliance as a function of state interests rather than of legal obligation. Working from this perspective, the Article provides a framework to evaluate the desirability of the federal incorporation of CIL and international human rights litigation in U.S. courts. The Article concludes that international human rights litigation under the current legal regime would likely complicate the achievement of the United States’ normative and strategic foreign policy goals. Given the executive’s institutional competencies, constitutional prerogatives and resource advantages, it is the branch best-placed to determine whether international human rights litigation will assist or hinder the United States’ foreign policy objectives. Therefore, the Article suggests that a modest shift along the continuum of existing judicial deference to the executive branch — perhaps in the form of judicial review of executive determinations on specific litigation under an arbitrary and capricious abuse of discretion or reasonableness standard — is warranted for international human rights litigation under the ATS.

For Optional Federal Incorporation

The American economy suffers from the domination of corporations by chief executive officers who exercise control for their own benefit, at considerable cost to shareholders and to efficiency. The costs of this defect are rising as capital flees the United States for a growing number of countries that treat investors better. America’s corporate governance problem began and persists because corporations are franchised by the states, and it is in the economic interest of the states (especially Delaware) to cater to CEOS because they control the choice of state of incorporation. To break this destructive arrangement I propose optional federal incorporation with the choice of jurisdiction to be made by shareholders alone. Shareholders are the only constituency whose goal is to maximize share value, and this goal coincides with society’s interest in economic efficiency. Shareholders also have the sophistication to decide major corporate questions wisely. The institution of optional federal incorporation and shareholder choice of jurisdiction of incorporation would trigger a true “race to the top,” a competition to offer the most efficient corporation law.

Loyalty Questioned: Nuevomexicanos in the Great War

Over four years after oil companies first applied for a permit, Congress authorized the Alaska Oil Pipeline in November 1973. Running from the Arctic Ocean to the Pacific,the pipeline crossed 600 miles of federal land, which made it a "major action significantly affecting the environment," thus triggering an environmental impact statement under the National Environmental Policy Act of 1969 (NEPA). Standard accounts tell of revolutionary environmental laws running into the economic reality of the 1970s. What has been lost in the telling is that the pipeline approval offered Congress an opportunity to investigate the wisdom of a proposed internal improvement. The pipeline controversy was not just the first battle of the environmental decade. It also continued nearly two centuries of debate over internal improvements, public financing of private investments, federal incorporation, monopoly charters, and national security. The pipeline approval was as much a decision about political economy as it was an environmental policy decision.

The Alaska Pipeline as an Internal Improvement, 1969-1973

Over four years after oil companies first applied for a permit, Congress authorized the Alaska Oil Pipeline in November 1973. Running from the Arctic Ocean to the Pacific,the pipeline crossed 600 miles of federal land, which made it a "major action significantly affecting the environment," thus triggering an environmental impact statement under the National Environmental Policy Act of 1969 (NEPA). Standard accounts tell of revolutionary environmental laws running into the economic reality of the 1970s. What has been lost in the telling is that the pipeline approval offered Congress an opportunity to investigate the wisdom of a proposed internal improvement. The pipeline controversy was not just the first battle of the environmental decade. It also continued nearly two centuries of debate over internal improvements, public financing of private investments, federal incorporation, monopoly charters, and national security. The pipeline approval was as much a decision about political economy as it was an environmental policy decision.

Vigorous Race or Leisurely Walk: Reconsidering the Competition over Corporate Charters

The long-standing and central debate on state competition in corporate law has been largely premised on a widely held belief that, whether the is toward the top or the bottom, states vigorously race in seeking to attract incorporations. In this paper, we argue that this belief is in fact incorrect and that the competitive threat to Delaware's dominant position in the incorporation market is quite weak. We discuss evidence that Delaware's position in this market is far more dominant and secure than has been previously recognized. We then analyze the structural features of the incorporation market that can explain this state of affairs. The weak-competition account that we put forward casts substantial doubt on the extent to which state competition can be relied on - even on the most favorable view of it - to produce optimal corporate rules. This account strengthens the case for some form of federal intervention; at the minimum, it would be desirable for federal law to invigorate competition by permitting shareholders to initiate and approve reincorporations and by providing a federal incorporation option.

Vigorous Race or Leisurely Walk: Reconsidering the Competition over Corporate Charters

The long-standing and central debate on state competition in corporate law has been largely premised on a widely held belief that, whether the is toward the top or the bottom, states vigorously race in seeking to attract incorporations. In this paper, we argue that this belief is in fact incorrect and that the competitive threat to Delaware's dominant position in the incorporation market is quite weak. We discuss evidence that Delaware's position in this market is far more dominant and secure than has been previously recognized. We then analyze the structural features of the incorporation market that can explain this state of affairs. The weak-competition account that we put forward casts substantial doubt on the extent to which state competition can be relied on - even on the most favorable view of it - to produce optimal corporate rules. This account strengthens the case for some form of federal intervention; at the minimum, it would be desirable for federal law to invigorate competition by permitting shareholders to initiate and approve reincorporations and by providing a federal incorporation option.

Corporate Privileges for the Public Benefit: The Progressive Federal Incorporation Movement and the Modern Regulatory State

Corporate Privileges for the Public Benefit: The Progressive Federal Incorporation Movement and the Modern Regulatory State

Proposed Federal Incorporation in the Progressive Era

Journal Article Proposed Federal Incorporation in the Progressive Era Get access Melvin I. Urofsky Melvin I. Urofsky Professor of History *Virginia Commonwealth University Search for other works by this author on: Oxford Academic Google Scholar American Journal of Legal History, Volume 26, Issue 2, April 1982, Pages 160–183, https://doi.org/10.2307/844839 Published: 01 April 1982

The Union of Utrecht. Its genesis and consequences

In the hall where we are now assembled, the former chapter-hall of the cathedral, which has been serving for a long time now as auditorium for the University of Utrecht, the Union of Utrecht was founded on 23rd January 1579. Our congress on federalism has been organized, as you know, within the context of the commemoration of the establishment of the Union four hundred years ago. It therefore seemed to me desirable, at the outset, to devote some attention to the origin of the league that was formed in this particular hall ‘for all eternity’. Next, in the second part of my lecture, the functioning of the federal system of the Republic of the United Netherlands will be discussed. It seems to me all the more justified to devote some attention to the formation of the Union as it constituted the foundation of the federal incorporation of the seven provinces into the Republic of the United Netherlands. The young Pieter Paulus, who in the years 1775– 77 published a commentary on the Union which has since become famous, described it as the Bulwark of our Liberty, the joyous Mother of so many blessings, the Cultivator of the prestige of this Republic at the principal courts of Europe, and as base of that Pyramid, to which eminent men have compared this State.1

Federal Incorporation of Business

Federal Incorporation of Business

Federal Incorporation and Securities Regulation

Federal Incorporation and Securities Regulation

Federal Incorporation: III

Federal Incorporation: III

Federal Incorporation: I

Federal Incorporation: I

Federal Incorporation of Railroads

Federal Incorporation of Railroads

Federal Incorporation of Railroads

Federal Incorporation of Railroads

Federal Incorporation of Railway Companies

Federal Incorporation of Railway Companies

Federal Incorporation. Constitutional Questions Involved

Federal Incorporation. Constitutional Questions Involved

Federal Incorporation: Constitutional Questions Involved. By Roland Carlisle Heisler. (Boston: The Boston Book Company. 1913. Pp. 231.)

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Federal Incorporation of Interstate Corporations

Federal Incorporation of Interstate Corporations