Why should slander and libel be illegal at all - why can't anyone say, claim, or publish anything they want whatsoever?
If you reflect on that the reason is fairly obvious.
Likewise, if negative SEO were illegal, it might have the same benefits.
Of course technically the standard would be much different from slander/libel, but the fundamental reason that we would limit free speech in this way is clear. It is just more damaging to the person being damaged than the limit on the free speech that it imposes costs us. (Which is taken seriously in the United States).
So, for this reason, there is a good argument to be made for specific, nuanced, laws against negative SEO in the form of civil penalties. I would support such a law.