Private Order Building: the State in the Role of the Civil Society and the Case of Fifa
Abstract: There is an ever-present danger that a private association may evolve into an enterprise with an elitist structure that extensively exploits its powers. While it is well known that the key role in limiting the excessive powers of state elites belongs to civil society, the question of policing the elites of monopolistic private orders is understudied. We use the case of the Federation Internationale de Football Association’s (FIFA) private order to illustrate how private orders evolve under constraints imposed by public orders. Although private ordering has advantages compared to public ordering, much of the credit for the success of FIFA’s private order goes to the state. Regulatory privileges granted to FIFA, and the refusal to intervene widely in FIFA’s affairs, have made private ordering possible in the first place. The challenge is, however, that private association capture by powerful interest groups can easily limit advantages of private ordering. In this situation, the proper role of the state is to act in the role of civil society by employing strategic interventions to help the private order deal with its governance failures without endangering the private order’s existence. Accordingly, when the power within a monopolistic private membership association becomes heavily imbalanced, it invites the state to intervene in an attempt to restore the lost balance. However, opening the door to the state—as in the case of so-called FIFA-gate—increases the danger that other and greater interventions will undermine the existence of the private order and remove its advantages.
