The use of private forms of regulation to address pressing environmental and social issues has received a lot of attention over the past 15 years.  Non-state market driven governance initiatives (Cashore 2002), such as certification and labeling schemes, are being used in an increasing number of sectors and for an increasing number of products.  Furthermore, scholarly research has extensively studied the importance and emergence of, and compliance with, such private regulatory initiatives.

An important new avenue in research on private regulation, however, pertains to its interactions with public policy.  Many of the areas that are covered by private regulatory programs are also, in one way or another, covered by public policy.  Yet, research has largely failed so far to theorize about and empirically assess the various ways in which public and private regulation interact.

In this paper, I will address this topic by analyzing how the European Union has attempted to regulate the arena of private regulatory initiatives and how it has integrated such private programs into its public policy.  The paper will compare four issues areas: biofuels, organic agriculture, wild-capture fishing, and fair trade.  To explain why there are differences in the EU’s regulatory response across issue areas, I will focus on the goals of public policy and differentiate between preferential treatment of product characteristics and market differentiation. Furthermore, I will explain that the initial reactions to private regulatory initiatives at the national and international level influence the way policy is shaped at the EU level.

This analysis will form the basis to examine the effects of the interactions between public and private regulations on the effective functioning of private regulatory programs.  I will analyze lessons that can be drawn from the EU’s responses to private programs, with a focus on initial private program institutional design, harmonization across private programs, and policy goals.

Key words: Private regulation, certification, EU, public policy, institutional interaction