This book explores possible ethical justifi cations for a moral duty for judges to enhance their cognition and examines how this duty sits within the existing legal framework on judicial liability, professional duties, and human rights. The impetus behind this inquiry stems from the realization, substantiated by a wealth of empirical evidence, that judges are susceptible to various implicit biases, which can subtly shape their perceptions, judgments, and decisionmaking processes throughout various stages of legal proceedings. Despite posing a threat to the impartiality and accuracy of judicial decisions, implicit biases remain largely unaddressed within the judiciary. Existing substantive and procedural rules designed to prevent arbitrary, partial, or inaccurate legal decisions primarily focus on the explicit manifestations of biases, neglecting to adequately address the negative eff ects of biases that operate beneath the level of consciousness, and which are not subject to direct introspection. Considering the profound impact of judicial decision-making for litigants and society, the idea of improving judicial cognition by various methods and technologies to ameliorate this scenario naturally emerged. Over the past four years, I have investigated the question of a moral duty for judges to enhance their cognition as part of my doctoral studies at the University of Bologna (Italy) and KU Leuven (Belgium). This book, which is largely based on my doctoral thesis, presents the results of this research.

I start my inquiry by defi ning implicit bias and the subcategories of cognitive and social biases, discussing the manifold ways in which they aff ect judicial decision-making, as well as the environmental and personal conditions that are conducive to biased thinking.

INTRODUCTION

Thus far, I have mainly focused on the cognitive limitations aff ecting human thinking generally, and judicial reasoning and decision-making in particular. I have explored how, in light of time and information constraints, people oft en rely on a number of heuristics that allow for decisions to be made with minimal cognitive eff ort, which may lead to suboptimal decisions. I have also examined how implicit attitudes and stereotypes relating to certain social categories aff ect how we perceive and interact with others. Most importantly, I have shown how both of these phenomena consist in extralegal factors that influence judges ‘ decisions, and therefore threaten the fair administration of justice. In the previous chapter, I have presented the debiasing strategies commonly proposed for addressing cognitive and social biases, and evaluated their application in legal settings. These strategies aim at mitigating judgment errors owed to biases and other constraints such as stress and fatigue. Their goal is to address the negative eff ects of biases by improving either the decision-making process or some relevant characteristics of the decision-maker (Zenker 2021). To the point that debiasing strategies improve the decision-maker ‘ s overall cognitive performance, they can be seen as a means of enhancing cognition.

Broadly speaking, cognitive enhancement encompasses interventions that improve cognitive functioning and performance, targeting domains like attention, reasoning, learning and memory, with the goal of restoring function toward the norm or to improve function beyond it.

According to experimental psychologists Ulrike Hahn and Adam Harris (2014, 42), “ a reader venturing into the psychological literature about human biases soon realizes that the word ‘ bias ‘ means many things to many people “ . Indeed, there seems to be a lot of terminological confusion surrounding the topic, and its defi nition (as well as its evaluation as neutral or inherently negative) can vary according to the field of knowledge in which it is used. Thus, before exploring the ways in which biases can aff ect judicial reasoning and decisionmaking, it is necessary to lend some precision to terms frequently encountered in the literature and to clarify the meaning behind the terminology that will be employed throughout this work.

The first clarifi cation relates to the broader distinction, commonly found in the cognitive and social psychology literature, between implicit and explicit biases (here correspondingly equating to unconscious and conscious biases). The first type is deemed implicit because it is generally considered to be latent, meaning that subjects tend to be unaware of them. The opposite is true for explicit biases, meaning that they are consciously accessible through introspection and endorsed by the individual. This distinction is relevant because while there is a terminological conflation between the notion of explicit bias and prejudice, these fundamentally diff er from implicit or unconscious bias, and my focus throughout this book will be given to the latter.

INTRODUCTION

In Chapter 1 of this book, I have discussed how, given that the concept of error presupposes a normative standard dictating how agents should act, biases can be thought of as causes of suboptimal reasoning/decision-making relative to that normative standard. If actual behavior falls systematically short of normative ideals, the question of how to close this gap naturally emerges. The goal of the present chapter is to review several strategies that have been proposed and tested to address implicit biases, mainly in legal contexts, in order to assess their eff ectiveness. Debiasing measures aim to align actual reasoning/decisionmaking processes and outcomes with the normative standard, seeking to address the negative eff ects of biases by improving either the decision-making process or some relevant characteristics of the decision-maker (Zenker 2021). To the extent that some debiasing strategies improve the decision-maker ‘ s overall cognitive functioning and performance, they can be seen as a means of enhancing cognition.

I will begin my analysis by defi ning and presenting the main features of debiasing and the diff erent ways in which debiasing strategies can be classifi ed, explaining how some of these fall under the category of cognitive enhancement adopted in this work(2). I will then explore the necessary conditions for successful debiasing and the main challenges for doing so(3). Subsequently, I will present the concepts of debiasing law, which largely corresponds to insulating techniques adopted in legal contexts, and debiasing through law, which targets the bias itself(4).

It will be shown here that the regulation of market operations pursues the objective of the proper functioning of the market. This objective should not be too radically dissociated from that of investor protection: by protecting the functioning of the financial market, regulation indirectly protects the investors who use it. From an international perspective, this objective explains why the law to be applied should, in our view, be subject to the law of the financial market, and the supervision of transactions should be entrusted to the authority of the place of listing. The legal system of the issuer's registered office may, however, have cumulative jurisdiction, depending on the circumstances – in particular where the regulation in question is aimed at protecting the internal organisation of the listed company at least as much as that of the market. The application of the law on market transactions will be studied by distinguishing between transactions aimed at supervising the issuer and those that artificially modify the securities price. In the first case, market transactions are subject to the law on threshold crossings and takeover bids (Section 1); in the second case, they are subject to the regulations on the purchase by the issuer of its own shares and on short selling (Section 2).

Section 1. SUPERVISION OF THE ISSUER

Threshold crossing and takeover bid. Threshold crossing law is a separate body of rules from takeover regulation. The former has its source in the Transparency Directive, which was adopted on the basis of the unification of the internal market, while the latter is derived from the Takeover Directive. The latter, although adopted at the same time as the financial legislative package of the Prospectus/Transparency/Market Abuse Directives established on the basis of the internal market, is a company law directive,adopted on the basis of the freedom of establishment.

Particularities of the liability of the issuer of financial securities for defective information. The foregoing discussion has shown that the marketing of financial securities gives rise to various legal information obligations for the issuer. What they have in common is that they constitute the information on the basis of which an investor is likely to make a decision to acquire financial securities. If this information proves to be defective,the investor will try to engage the liability of the issuer. This liability has several particularities. The first is that there is a certain tension between the remedial function of civil liability, and the inherent randomness of investing in financial instruments. Civil liability cannot have as its effect the removal of the possibility of losing the outlay. This is why the hazard must not be remedied, at the risk of the issuer becoming the investor's insurer, and this is all the more true since the occasional existence of defective information is an element whose scope may be considerably reduced by the investor's diversification strategy. The existence of a hazard also means that the defective information issued is not necessarily the sole cause of the variations in value of the instrument. In these conditions, the establishment of proof of both a certain loss and a causal link between the event and the loss suffered appears fundamental. However, as Mr Prorok has shown, these two elements can be very difficult to prove, which is why any presumptions of harm or causality will often be decisive in resolving the dispute. It is precisely on these points that the laws diverge greatly, making the resolution of the conflict of laws extremely significant.

Definition. Market abuse is nowadays based on the Market Abuse Regulationand covers two offences: insider trading and market manipulation.The former is defined as follows:

‘Insider trading arises where a person possesses inside information and uses that information by acquiring or disposing of, for its own account or for the account of a third party, directly or indirectly, financial instruments to which that information relates […].’

The Regulation adds that recommending a transaction to a third party on the basis of inside information constitutes insider trading.Insiders are persons who receive inside information.There are two types of market manipulation: dissemination of false informationand price manipulation,i.e. behaviour aimed at distorting the price of an instrument.

Scope of application of French criminal law. The application of French criminal law is based on unilateral and abstract criteria that give it a particularly broad international scope. However, as Donnedieu de Vabres has already written, ‘it is paradoxical to want to resolve the conflict of criminal jurisdictions without considering the purpose of criminal law, which is prior to and superior to States’.Taken seriously by Professor Chilstein, this assertion led the author to draw on the mandatory rules method in order to define the international scope of application of the so-called ‘accessory’ criminal law, which includes market abuse.In short, the idea is to align the scope of the offence not with the jurisdictional criteria of French criminal law, but with the purpose of the offence.This approach is similar to that of identifying the interest protected by the offencein order to deduce its scope of application in the area. It was proposed in financial matters by Professor Fadlallah following the Péchiney case, in which the French authorities prosecuted French citizens for insider trading in a French company whose securities were listed in the United States.

If the realm of the conflict of laws has been traditionally depicted as ‘a dismal swamp, filled with quaking quagmires, and inhabited by learned but eccentric professors who theorize about mysterious matters in a strange and incomprehensible jargon’, no less sophisticated has become nowadays the law of financial markets. In the latter, the multiplicity of actors, the heterogeneity of the legal situations and relationships which connect them one with the other and, not least, their geographical dispersion makes for a complexity which is only at par with the relevance they have gained in today's economy.

It can therefore appear a daunting task the one that Augustin Gridel has undertaken for his doctoral research, to analyse the realm of financial markets through the lens of the conflict of laws, thereby combining the subtle intricacies of these two highly technical fields. A daunting task, but a welcome one, whose results are presented in this book, that constitutes the crowning achievement of Dr. Gridel's long research and reflection [under the magisterium of Professor Louis D’Avout], offered in English version to the legal community of academics, private practitioners and public authorities.

The objective of Dr. Gridel's work, and one of its distinguishing features, is not to explore some specific aspects or area of the law of the financial markets, but rather to encompass the wider spectrum of legal relationships and situations which are established in the operations of those markets, and test the soundness of their regime when regarded under the conflict of laws perspective, offering proposals de lege ferenda, where appropriate.

Presentation. Considering the relationship of issuers with financial markets restricts the scope of the law applicable to them in two ways. First, it restricts the scope to securities only: the issuer will solicit a financial market in order to collect the savings necessary for its own investments. Secondly, the only laws involved are, on the one hand, the law applicable to the issuer, most often the lex societatis or, where applicable, the law of the unincorporated group, and, on the other hand, the law of the financial market. The latter will then aim at protecting its residents, and will most often apply as the law of the place of solicitation.It might be tempting to combine all the laws protecting residents into a unilateral conflict rule. This commonality of function would allow the development of a single criterion of application, the solicitation of residents, and a specific regime under which local laws are self-limiting whenever the law of the issuer provides equivalent protection. As it stands, however, this rule does not reflect positive law. Firstly, the idea behind it has penetrated the European legal order so well that it often gives global jurisdiction to the issuer's legal order as regards marketing rules which are nevertheless aimed at protecting residents. Secondly, the proposed regime could only be applicable to ‘a priori’ protection rules, i.e. those relating to marketing. Indeed, the ratio legis of liability rules, which contribute to the protection of residents through reparation for their damage, does not lend itself well to self-limitation: it is up to the legal system whose residents have been cheated to provide redress. Moreover, the relationship between issuers and financial markets is not limited to the protection of residents. Thus, when the admission of securities to the trading platform is in question, the law of the financial market pursues the objective of the proper functioning of the market as well as the protection of residents. Conflict of laws must therefore be examined in the light of the issuer's different relationships with the financial markets.

In the context of a financial market, investors are the principals who, through their intermediaries, preside over market operations. Their relationship with the financial markets is the chosen domain of the lex mercatus. The law of the financial market has a strong application here, based on the objective it pursues: the proper functioning of the trading platform. This function of the law of the financial market makes it possible to group the rules that pursue it into a single category, the lex mercatus. The application of these rules is triggered by the use of the trading platform; their connecting criterion is that of the platform itself,which we have endeavoured to define.Such a category is likely to be included in a bilateral conflict-of-laws rule according to which:

‘The rules relating to the operation of the financial market shall be subject to the law of the trading venue.’

Firstly, it is possible to include the rules relating to the obligations of market members towards the financial market. These rules no longer make it necessary to subject the contract concluded with their clients to the law of the market, but they continue to ensure their protection through the rules of conduct that are imposed on members (Chapter 1). The application of the lex mercatus is most evident in the regulation of market transactions. Although the concept of market operation has replaced that of stock exchange operation, it nevertheless continues to designate the mechanism that ‘consists in the production and execution of the order on the market’.

In banking and finance, transnationality permeates the day-to-day professional life and makes the dedicated lawyer an internationalist by necessity. There are good reasons for this: the intangible nature of services, the desire of operators even regulated to conquer foreign markets; sometimes because of the extraterritorial spread of local policies relating to the person of the operators or the products marketed. Although it does not always have a good reputation, private international law, with its promise of a widely understood conflict-oflaws discipline, is making inroads into the legal practice of this specialised and globalised sector.

For a young academic, it was an ambitious undertaking to systematically combine private international law with the law of financial markets and instruments. All the more so since, as Mr Augustin Gridel's methodological commitment attests from the introduction to his thesis, any good conflict-oflaws solution is developed by contemplating the domestic legal and regulatory material potentially applicable to cross-border relations. The relevant domestic law is widely publicised and, in Europe at least, consists of two equal layers, one national, the other European.

One therefore encounters the difficulty inherent in these matters, which are steeped in administrative regulation: the international applicability of public law plays a driving role, although the theory is not guaranteed, since it constitutes the dark side of the conflict-of-laws’ historical development.

The issue of a financial instrument. The expression ‘issue’ is borrowed from monetary law. This borrowing is undoubtedly explained by the fact that, like money, financial instruments constitute intangible assets, circulate, are liable to be recorded in an account and allow for payment.However, French authors do not always designate the same thing, and refer indistinctly to the issue of a security, a share, or even the creation of a security.All these expressions are not equivalent, however, and two clarifications are necessary with regard to the purpose of the issue and its process.

First, according to French law, the object of the issue is the negotium, i.e. the share, debt or unit of a collective investment scheme.However, the issue results in the creation of an instrumentum,the security, which accounts for the negotium issued. It is only by metonymy that we speak of the issue of securities.Today, securities are made manifest in the form of a book entry, the regime of which differs from traditional instruments in several ways: it is necessary for the materialisation of the negotium in order to allow its transfer, its regime allows for easier circulation, and its holding is accompanied by a presumption of ownership.These elements explain why it is sometimes difficult to distinguish the instrumentum from the negotium, but the resolution of conflicts of law makes it necessary, ‘and if the search for the applicable law depends on this distinction, it helps at the same time to establish it: by becoming aware of the fact that one aspect of the phenomenon would not reasonably be subject to the same law as another, one is led to specify what each of these entities consists of’.It should be added, however, that the situation is made more complex when the issuer places its securities with an intermediary who, in turn, issues securities offering identical prerogatives to those of the securities it holds.This frequent case, which is that of depositary receipts, makes it necessary to clearly identify who the issuer of the security is, and what prerogatives are actually offered by the security.Since depositary receipts are a variety of debt securities, the conflict of laws rules studied here are applicable to them.

Definition. The marketing of financial securities, despite its importance, is curiously not subject to any general definition in French positive law.In European law, only the Directive on alternative investment funds defines it as ‘an offer or placement, directly or indirectly, at the initiative of the manager or on his behalf, of units or shares of an AIF which he manages, to investors domiciled or having their registered office in the Union’.It can be inferred that the marketing of financial securities is understood as an offer or placement of financial securities to investors. This definition allows three remarks. Firstly, the author of the marketing acts is not necessarily the issuer.Secondly, the marketing may take place without the securities being admitted to trading on a trading platform. Such admission is one of several marketing methods. Finally, marketing may be directed at the public in general or at selected investors;in both cases, this function of marketing explains why it is subject, in principle, to the law of the place where its intended recipients reside. These observations lead to a clear distinction between two aspects of the marketing process: firstly, the issuer's decision to market the securities by soliciting the public and, secondly, the implementation of this decision, which is manifested in marketing acts.

The marketing process. While subsequent marketing acts are not necessarily the responsibility of the issuer, the initial decision to market through public solicitation is the responsibility of the issuer. This is due to the “freedomresponsibility” pairing. Indeed, the issuer, if it decides to solicit the public, will bear the information obligations that such solicitation triggers. These disclosure obligations are of two types: the prospectus, a one-off document, the preparation of which is triggered by a public offer and is subject to administrative approval, and the periodic disclosure obligations, triggered by the admission of the securities to trading.

Double degree of regulation of property law. The status of securities, from a proprietary point of view, is often obscured by confusions arising from property law, which justify some remarks on the bias of the developments to come. We subscribe to this school of thought, which distinguishes between two levels of regulation stemming from property law, the first relating to ownership of property and the second, isolated within the first, concerning rights over tangible things.This conception of property law, which considers that the ‘proprietary status’ of rights is independent of their content, has several consequences.

Firstly, there is a ‘primary regime’of property law, applicable irrespective of the content of the relevant objects. This primary regime can be determined by reference to the domain of the applicable law. This is mainly made up of the following questions : the regime of its transfer; the opposability of this transfer to third parties; the constitution and effects of conventional and legal guarantees likely to have an impact on the thing; the conflicts of competing rights, also known as priority rights. These elements make it possible to emphasise the importance of the issue at hand. The choice made by the French legislator to favour, in matters of securities, the good faith purchaseris not universal: priority conflicts are not necessarily resolved in favour of the purchaser and, even when this is the case, not necessarily under the same conditions. Above all, the scope of this law extends to all the guarantees which have an impact on the security: the validity and the terms of their enforcement depend on the proprietary status to which they are attached.

The reason for this is simple: the law of guarantee is a branch of property law, if only because their enforcement always requires a form of alienation. If the links between the law of guarantee and the law of property no longer need to be demonstrated,the same applies to the links between the law of guarantee and the law of insolvency,6 not to mention the fact that the usefulness of the guarantee ultimately derives from the means of enforcement that they open up to their holder.