terms and conditions (GTCs), private enforcement systems, and monitoring bodies that allow a company to create, devise, enforce and adjust its own rules – often across borders. Through analysis of Meta’s legal documents, I identified three key strategies the company uses to govern the Metaverse: 1. Codifying its own constitution Meta’s Terms of Service operate as more than mere legal disclaimers. They are a governing charter, regulating everything from user conduct to commercial rights, data flows and third-party integrations. 2. Cascading those rules through networks These terms apply not just to direct partners, but also to partners of partners. Such “domino clauses” require all connected actors to accept and enforce exclusively Meta’s rules, allowing Meta’s rules to extend across complex global value chains. 3. Monitoring and sanctioning compliance Meta employs both automated and human oversight. For example, its much-debated Oversight Board is tasked with monitoring content, resolving disputes, and sanctioning violations. These mechanisms allow Meta to enforce rules even in jurisdictions with no relevant law, or with no appetite for enforcement. Taken together, these institutional devices amount to what I call a Metaverse Law. It is not written by states but practiced and enforced by platforms and its users’ consent. MARKING THEIR OWN HOMEWORK Of course, this raises important questions. Are we comfortable with tech companies writing their own rules? What happens when a private constitution overrides local laws, cultural values, or democratic oversight? Some critics argue that such corporate self-regulation is little more than “marking your own homework.” Yet even sceptics acknowledge that governments cannot go it alone. When innovation moves faster than legislation – as is the case with most disruptive digital technologies – private rules may be a necessary complement to public law. The question is not whether private rulemaking exists. It already does. The real question is how to make it more transparent, responsible, accountable, and ethical. GOVERNANCE IS INNOVATION In business schools and policy circles, innovation is often discussed in terms of technology, resources, or organisational learning. But governance is also innovation, especially when it has potential of helping a disruptive idea to scale more responsibly. Instead of waiting for external regulators to catch up, companies can proactively build the institutional scaffolding needed to ensure their innovations “do good” and “avoid harm.” Importantly, institutional mechanisms are not static. They evolve. Meta’s Oversight Board, for instance, has been both praised and critiqued – but it remains a precedent-setting attempt at creating transnational dispute resolution in the digital sphere. Far from replacing government, private rules can fill years of regulatory gaps, especially in emerging spaces like the Metaverse. Like the law merchant of old, they offer a flexible, pragmatic way to coordinate trade, behaviour, and trust when formal law is absent or inadequate. WHO WRITES THE RULES? As more firms and users enter the Metaverse, the governance challenge will only grow. But if companies invest in interoperable standards, fair oversight, and ethical self-regulation, the Metaverse could become more than just a fluke of imagination. It could become a test bed for a new kind of global governance of human behaviour in a digital space. In the end, governing the Metaverse is not about choosing between public and private law. It is about recognising that both matter, and that innovative regulation is just as important as innovative technology. In this new frontier, who writes the rules is as important as who writes the code. FIFTY FOUR DEGREES | 49 Dr Jekaterina Rindt is a Lecturer in Marketing. Her research explores the intersection of innovation management and governance. Her latest research on the Metaverse was funded by the HERMES (Higher Education and Research in Management of European Universities) grant. j.rindt@lancaster.ac.uk
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