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International Law

• Types of law systems


– Common law
– Code law
– Islamic law
– Communism
• Definition:
– Treaties, customs, recognized principles when one
country deals with another
– Bilateral
– Multilateral
LESCANT Factors
• Language
• Environment & Technology
• Social organization
• Contexting
• Authority
• Nonverbal behavior
• Time Concept
Contracts for the International
Sale of Goods
• 1980
• Adopted in 53 countries, including U.S.
• Similar to UCC
Treaties and International Trade
Organizations
• WTO/GATT
– Outlaws tariff discrimination
– Most favored nation status
– Outlaws nontariff barriers
– Caps tariffs
Treaties and International Trade
Organizations
• UNCITRAL
– United Nations Commission on International
Trade Law
– 36 countries
– Proposes ‘model laws’ for uniformity
Treaties and International Trade
Organizations
• EU
– European Commission
• Education
• Health
• Culture
• Consumer protection
– Council of Ministers
– European Parliament
– Court of Justice
– Euro
– Antitrust laws similar to Sherman Act
Treaties and International Trade
Organizations
• NAFTA
– All tariffs to be eliminated in 15 years
• Can be “snapped back” if US is overrun with imports or
imports cause harm
• Duty free if 100% North American origin
– Environment
• Left to each nation if not arbitrary or unjustifiably
discriminatory
• Regulations must be “necessary” to protect life
• Regulations must be based on “scientific principles”
• No mention of genetic engineering
Treaties and International Trade
Organizations
• U.S. International Trade Commission
– 6 appointed commissioners with 9 year terms
– Advises president on preferences (lower tariffs)
– Industries petition ITC
– Import interference with agricultural programs
– Keeps track of unit labor costs by country
– Special 301
• International theft of U.S. intellectual property
• Identifies “priority foreign countries”
• May impose sanctions
International Courts
• No real enforcement
• International Court of Justice (World Court)
– Established by UN
– Nation v. Nation
– Voluntary agreement to have case heard
– Not bound by the decisions
– Not for business disputes
International Courts
• European Court of Justice
– Enforces EU law
– Member nations, EU institutions, other parties
& businesses v. member nations
– Enforcement by national courts
International Courts
• WTO dispute resolution
– Trade disputes between member nations
– May order retaliatory trade sanctions
International Arbitration
• Organizations
– American Arbitration Association
– International Chamber of Commerce
– UN Commission on International Trade Law
• Arbitrator issues award
– No enforcement power
• Enforcement only if:
– Nation is signatory of UN Convention on the
Recognition and Enforcement of Foreign Arbitral
Awards
International Law Principles
• Sovereign immunity
– Equality of countries
– Each country sovereign nation
– No country subject to another’s laws without
consent
– International commercial transactions are
voluntary – subjects country’s government to
civil suits
International Law Principles
• Expropriation
– Act of State Doctrine
– Recognizes as valid acts by other nations even
if illegal in US
– Usually challenged when private property is
nationalized
International Law Principles
• Protections of US property
– Foreign Assistance Act of 1962 – Hickenlooper
amendment
• President can punish nations that expropriate private US
property
• Actual expropriation
• Effective expropriation
– Clauses in trade treaties
– Overseas Private Investment Corporation (OPIC)
• Federal insurer – premiums based on risk
• Countries where per capita income is $250 or less
• Confiscation, insurrection, repatriation, war, revolution
International Law Principles
• Repatriation
– Some nations limit repatriation
– Acts of state
• Forum non conveniens
– Cases must be brought under the correct
jurisdiction
Conflicts of Law
• No 2 countries have the same laws
• The parties may choose which law applies
• By default, the laws of the country of
contract performance apply
Protections in International
Competition
• Antitrust laws
– US Law
• All US firms
• All firms operating in the US
• Firms whose business has substantial impact on US
trade
• Who can sue
– U.S. & foreign governments
– U.S. & foreign businesses
– Any other injured party
Protections in International
Competition
• Export Trading Company Act of 1982
– Allows Jvs between competitors when outside
the US
– Must show the firm will not:
• Substantially lessen competition or restrain trade in
the U.S. or restrain export trade of a competitor
• Cause unfair competition
• Affect the price of goods/services in the U.S.
• Resell the exported goods in the U.S.
Protections in International
Competition
• Helms-Burton Act
– 1996
– Punishment for firms that use confiscated U.S.
property
• Executives and families may not enter U.S.
• Allows suits against those companies
• Targeted at Cuba
Protections in International
Competition
• Intellectual Property
– International agreements being negotiated
– Gray Market goods
• Goods with U.S. intellectual property protection are are foreign
made & imported without consent of U.S.trademark holder
– Outlawed by U.S. Customs Service
• Criminal Law
– Individuals and businesses are subject to host country’s
criminal law
Foreign Corrupt Practices Act
• Applies to all businesses registered under SEC
• Illegal to use mails or interstate commerce for bribes
• Shareholders, officers, directors
– 5 years in prison
– $100,000 fine
• Business penalty – up to $2 million
• Exceptions
– Grease payments
– Bribes to non-government foreigners
– Extortion payments
– Payments that are legal within he host country