Viral governance how unilateral U.S. sanctions changed the rules of financial capitalism

Grégoire MALLARD

This article presents how global governance went viral as its targets moved from sovereign to corporate entities and its source from multilateral financial institutions to domestic U.S. institutions. It argues that viral governance describes how the United States rewrote global rules through its sanctions program first against Iran, then against Iran-affiliated global banks and businesses, and finally against the daily compliance practices of global money, information, and technology flows in general. Utilizing over 150 interviews with international experts in the field of sanctions and banking, the article describes the recursive process that led the U.S. government to assume global regulatory powers and to initiate deglobalization in its trade war against the European Union and China. The article concludes that viral governance perpetuates crises, whereas multilateral governance seeks to extinguish crises; it operates through sustained legal uncertainty over the jurisdictional limits of the hegemonic power, while multilateral governance seeks to absorb legal uncertainty; it requires the abolition of all regulatory counterpowers, whereas multilateral governance can allow strong states to assume the equality of sovereign powers.