1. Legal Forces
Chapter 11

2. Be aware of complex legal forces
International trade is affected by thousands of laws
issued by hundreds of countries and states
can make cross border and international business very difficult

3. Alternate purposes of taxes
Can be used for several different reasons:
redistribution of income
discourage use of specific imported goods
encourage use of domestic goods
discourage investment in other countries
Taxes also differ from country to country

4. Antitrust Laws Most strictly enforced in the U.S.
often try to enforce them extraterritorially
Germany comes second in enforcement
EU is working on more stringent enforcement
Japan’s enforcement in almost non-exixtent

5. Tariffs, Quotas & other obstacles
International businesses must be aware of things such as:
tariffs on imports
quotas on specified imports to hinder competition
others include standards, VER’s and VRA’s

6. Product Liability “Sue the bastards!”
In the U.S. this is the easiest place in the world to sue a company for product liability
Many other countries don’t have laws allowing a person to sue a company for liability
other countries even have a cap on the amount that can be awarded

7. Price&Wage Controls, labour laws & currency exchange
All of these factors differ in each country
Almost all countries have currency exchange laws. These usually put a cap on the amount of currency that can be bought or exchanged
Watch out for price ceilings and floors
What is min. wage? Max. hours in a shift?

8. Local Laws Be wary of local laws
what is normal in one country may be illegal in another
do careful research on local customs
possibly hire an advisor in potential trading country to help you be aware of local and miscellaneous laws

9. International Assistance
Be aware of the institutions that are there to help
The CISG was formed by the UN and it’s laws apply to all international sales unless expressly excluded in contract
The EU also has laws to govern trades between it’s members
some countries negotiate arbitration as part of their contract

10. Protect your Intellect
Patents, trademarks, trade names, copy rights and trade/company secrets are all examples of intellectual properties
these are some of the hardest things to protect
can cost a company $$ if stolen/used by other company

11. Industrial Espionage Beware of industrial espionage!!!
This is when a competing company tries to get trade secrets or privileged information from another company by illegal or unethical means

12. Terms to Know Antitrust laws extraterritorial product liability
arbitration
intellectual properties
industrial espionage