1. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved Slides developed by Les Wiletzky PowerPoint Slides to Accompany ESSENTIALS OF BUSINESS AND ONLINE COMMERCE LAW 1 st Edition by Henry R. Cheeseman Chapter 25 International and Comparative Law Chapter 25 International and Comparative Law

2. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 2 International Law (1 of 2)  Law that governs affairs between nations  Law that regulates transactions between individuals and businesses of different countries  No single legislative source of international law All countries of the world (and numerous international organizations) are responsible for enacting international laws

3. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 3 International Law (2 of 2)  No single world court responsible for interpreting international law  Several courts or tribunals hear and decide international legal disputes of parties that agree to appear before them  No world executive branch that can enforce international laws Nations do not have to obey international law enacted by other countries or international organizations

4. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 4 Sources of International Law  Sources of international law  Sources of international law – those things that international tribunals rely on in deciding international disputes Article 38(1) of the Statute of the International Court of Justice  Article 38(1) of the Statute of the International Court of Justice lists four sources of international law: Treaties and conventions Custom General principles of law Judicial decisions and teachings  Sources of international law  Sources of international law – those things that international tribunals rely on in deciding international disputes Article 38(1) of the Statute of the International Court of Justice  Article 38(1) of the Statute of the International Court of Justice lists four sources of international law: Treaties and conventions Custom General principles of law Judicial decisions and teachings

5. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 5 Treaties and Conventions Treaties  The first source of international law  Agreements or contracts between two or more nations that are formally signed by an authorized representative and ratified by the supreme power of each nationTreaties  The first source of international law  Agreements or contracts between two or more nations that are formally signed by an authorized representative and ratified by the supreme power of each nationConvention  Treaty that is sponsored by an international organization e.g., United Nations  Conventions normally have many signatoriesConvention  Treaty that is sponsored by an international organization e.g., United Nations  Conventions normally have many signatories

6. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 6 Custom (1 of 2)  The second source of international law  Custom describes consistent, recurring practices followed by two or more nations when dealing with each other over a period of time that have become recognized as binding  Customs that have been recognized for some period of time are often codified in treaties

7. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 7 Custom (2 of 2)  Two elements must be established to show that a practice has become a custom: 1.Consistent and recurring action by two or more nations over a considerable period of time 2.Recognition that the custom is binding because of legal obligation

8. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 8 General Principles of Law (1 of 2)  The third source of international law principles of law  Consist of principles of law recognized by civilized nations national law  These are principles of law that are common to the national law of the parties to the dispute

9. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 9 General Principles of Law (2 of 2)  The general principles of law may be derived from: Constitutions Statutes Regulations Common Law Other Sources of National Law

10. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 10 Judicial Decisions and Teachings  The fourth source of international law judicial decisions and teachings  Consist of judicial decisions and teachings of the most qualified legal scholars of the various nations involved in the dispute stare decisis  International courts are not bound by the doctrine of stare decisis

11. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 11 The United States and Foreign Affairs (1 of 3)  The Constitution gives the federal government most of the power to deal with foreign affairs of this country: Foreign Commerce Clause Foreign Commerce Clause – Article I, Section 8, clause 3 vests Congress with the power “to regulate commerce with foreign nations.” Treaty Clause Treaty Clause – Article II, Section 2, clause 2 states that the president “shall have power, by and with advice and consent of the Senate, to make treaties, provided two- thirds of the senators present concur.”

12. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 12 The United States and Foreign Affairs (2 of 3) Foreign Commerce Clause  Any state or local law that unduly burdens foreign commerce is unconstitutional under the Foreign Commerce Clause  The president is the agent of the United States in dealing with foreign countries

13. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 13 The United States and Foreign Affairs (3 of 3) Treaty Clause  Under the Treaty Clause, only the federal government may enter into treaties with foreign nations Supremacy Clause  Under the Supremacy Clause of the Constitution: Treaties become part of the “law of the land” Conflicting state or local law is void

14. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 14 The United Nations (UN)  International organization created by multinational treaty in 1945  Goals of the United Nations (U.N.): Maintain peace and security in the world Promote economic and social cooperation Protect human rights

15. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 15 Governance of the United Nations (1 of 3) The United Nations is governed by:  The General Assembly Composed of all member nations The legislative body of the U.N. Adopts resolutions which have limited force Resolutions are usually enforced through persuasion and sanctions

16. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 16 Governance of the United Nations (2 of 3)  The Security Council Composed of 15 member nations  Five are permanent members  Ten are chosen for two-year terms Primarily responsible for maintaining international peace and security Has authority to use armed forces

17. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 17 Governance of the United Nations (3 of 3)  The Secretariat Administers the day-to-day operations of the United Nations Secretary-General Headed by the Secretary-General, who is elected by the General Assembly The Secretary-General may refer matters that threaten international peace and Security to the Security Council and use his office to help solve international disputes

18. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 18 International Court of Justice  The judicial branch of the United Nations World Court  Also called the World Court  Located in The Hague, the Netherlands  Only nations (not individuals or businesses) may have cases decided by this court  A nation may seek redress on behalf of an individual or a business that has a claim against another country

19. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 19 UN Agencies  The U.N. is also composed of various autonomous agencies that deal with a wide range of economic and social problems: UNESCO UNICEF IMF World Bank International Monetary Fund IFAD

20. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 20 Regional International Organizations (1 of 6) The European Union (EU)  Comprises many countries of Western and Eastern Europe  Created to promote Peace and security Economic, social, and cultural development

21. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 21 Regional International Organizations (2 of 6) The European Union (EU) The European Union (EU) (continued)  The EU treaty creates open borders for trade between members  The EURO is the single monetary unit  European Court of Justice – the judicial branch of the EU European Court of First Instance (CFI)

22. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 22 Regional International Organizations (3 of 6) The North American Free Trade Agreement (NAFTA)  An international treaty that creates a regional free-trade zone consisting of the United States, Canada, and Mexico  Eliminates or reduces most of the duties, tariffs, quotas, and other trade barriers between the members

23. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 23 Regional International Organizations (4 of 6) Latin, Central, and South American Economic Communities  Central American Common Market  MERCOSUR Common Market  Caribbean Community  Andean Common Market

24. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 24 Regional International Organizations (5 of 6) African Economic Communities  Economic Community of West African States  Economic and Customs Union of Central Africa  East African Community  Organization of African Unity  African Economic Community

25. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 25 Regional International Organizations (6 of 6) Asian Economic Communities  Association of South East Asian Nations (ASEAN) Middle Eastern Economic Communities  Organization of Petroleum Exporting Countries (OPEC)  Gulf Cooperation Council

26. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 26 World Trade Organization (WTO)  International organization of more than 130 member nations  Created to promote and enforce trade agreements among member nations  WTO members have entered into many trade agreements among themselves  By enforcing trade agreements among its members, the WTO has become the world’s most important trade organization

27. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 27 WTO Dispute Resolution  One of the primary functions of the WTO is to hear and decide trade disputes between member nations  Panel  Dispute Settlement Body  Appellate Body  Panel  Dispute Settlement Body  Appellate Body

28. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 28 National Courts Decide International Disputes (1 of 3) national courts  The majority of commercial litigation involving international business transactions are heard by national courts of individual nations  Judicial Procedure Choice of forum clause Choice of forum clause – designates the judicial or arbitral forum that hear and decide the case Choice of law clause Choice of law clause – designates the law to be applied by the court or arbitrator in deciding the case

29. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 29 National Courts Decide International Disputes (2 of 3)  Act of State Doctrine Judges of one country cannot question the validity of an act committed by another country within that other country’s borders Based on the principle that a country has absolute authority over what transpires within its own territory

30. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 30 National Courts Decide International Disputes (3 of 3)  The Doctrine of Sovereign Immunity A doctrine that states that countries are granted immunity from suits in courts of other countries Foreign Sovereign Immunities Act Foreign Sovereign Immunities Act – exclusively governs suits against foreign nations that are brought in federal or state courts in the United States

31. Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. 25 - 31 International Law  Jewish Law and the Torah  Islamic Law and the Koran  Hindu Law – Dharmasastra  Jewish Law and the Torah  Islamic Law and the Koran  Hindu Law – Dharmasastra