Outline to Global Business Law

Hello I. Introduction to Global Business Law
A. The Forms and Challenges of international business transactions
1. Three categories prevail: exports, licensing of products abroad, and foreign direct investment (“FDI” ) See table on p. 28.
a. Exporting
i. Unaided exports-do not involve the use of an international sales agency arrangement or distributor arrangement.
ii. With sales agency (shared domestic and overseas control of sales)
iii. With distributorship (control of sales is overseas)
b. Licensing of Production Abroad
i. Many times exporters want to reduce costs and raise profit by moving the means of production overseas market (or at least nearer to the overseas market)
ii. But company does not want to build or purchase factory, so enters into licensing agreement permitting the overseas company to use patented manufacturing processes and trademark. The overseas company then pays a royalty to the domestic company that owns the Patents /trademark.
c. Foreign Direct Investment (“FDI” )
i. Instead of getting licensing agreement, the U.S. company wants to establish its own manufacturing and marketing operations in the overseas market.
ii. May create its own subsidiary company under overseas law.
1. overseas law may limit foreign investors’ control (may require a joint venture with overseas company)
2. Special Challenges of Conducting Transborder Business
a. Exporting
i. Transporting
1. who takes on risk?
a. Why want risk?-maybe client would be able to find cheapest/most efficient method.
ii. Insurance
iii. 3rd parties
1. freight forwarder
2. banks (letter of credit to guarantee payment)
3. local legal counsel
iv. payment (currency problems)
v. Dispute settlement
vi. Tax considerations
vii. Intellectual Property Protection
viii. Tariffs on importation of goods
ix. Export controls on goods leaving seller’s country .
x. Political matters
b. Licensing of Products Abroad (including many of the above)
i. Gov’t. regs on licensing agreements
ii. More intellectual property issues.
iii. Inspection and quality control.
iv. Other terms that licensing agreement should include:
1. grounds for termination
2. royalties
3. payment terms (currency)
4. obligation of licensee to grant back to licensor new design elements
5. territorial limitations on the licensee’s right to sell its products.
c. FDI (including many of the above)
i. Structure
ii. Joint venture (contractual or corporate)
iii. Control vs. ownership
iv. Registration and regulation
v. Expropriation- protect against gov’t action to nationalize the investment property.
vi. Currency matters
vii. Codes of Conduct
d. General Principles
i. All transnational business transactions must be viewed as substantially different from domestic transactions. (more risk internationally)
ii. FDI poses more challenges and risks than exporting.
3. Where Global Business Law Fits into the International Legal System? See p. 37.
a. The Character of International Economic Law
i. International Public Law (human rights, law of the sea, etc.)
ii. International “Private Law” (transactions, business, etc. as well as adoption and family law)
b. Global Business Law and the Sources of International Law
i. Much of the law comes from local or national law
ii. Other influence comes from multinational regulations-two main sources: Treaties and Customary International Law . (see handbook p. 14)
1. Article 38(1) of the Statute of the International Court of Justice
a. Public international law
b. Made up of
i. Treaties and
ii. Customs (International Commerce Organization “INCO” terms)
iii. International Organizations (p. 48)
1. IO=International Organization
2. INGO=International Non-Governmental Organization
3. PIO=Public International Organizations
4. NATO=North American Treaty Organization
5. UN=United Nations
6. GEO= Global Economic Organization
7. EU=European Union
8. ADB=Asian Development Bank
9. IFI=International Financial Institutions
10. WTO=World Trade Organization
11. IMF=International Monetary Fund
iv. GATT= General Agreement on Tariffs and Trade
c. Global Business Law and Other Issues of International Law
i. The future of the nation-state- this form of political organization may change as evidenced as the rise of importance of international organizations, multinational corporations. Borders are much more porous.
ii. Withering of multilateralism- may cause focus on international regulations to shift more to individual nations’ regs. North-South divide- tensions b/t affluent northern countries and underdeveloped southern countries
iii. Security and Terrorism- more security raises cost of international business and could get worse if terrorism increases.

II. Finding Your Way in a Foreign Legal and Cultural Landscape
A. Intro- 3 tools to help understand the myriad of different laws.
1. Classify legal systems by the “families” they fit in to.
2. Get help from persons that do have specific knowledge and experience that will be needed in international transactions.
3. Know how to watch for cultural signals and how to de-fuse culturally difficult situations.
4. Illustration #2A- GG wants you to compare Germany, Mexico, Iraq, and China’s legal systems to the UK and lead negotiations on GGs behalf in regard to business sales in those countries
B. Legal Traditions, Legal Systems, Legal Families, and Global Business Law
1. Legal Tradition- set of deeply held, historically conditioned attitudes about how law is formulated, taught, applied, and interpreted, and as to the relationship between law and society
a. Historically conditioned, so develops over centuries and cannot just be changed.
b. Shared with other countries.
2. Legal family- set of legal systems present with the current world of nation-states that share a legal tradition.
a. civil law countries-Other European countries and Latin American
b. Common law countries -U.S., Canada, UK, Australia, New Zealand, India (to some extent)
c. Islamic law tradition-Middle East, Central and Southeast Asia. Very few are predominantly Islamic law, but that is changing.
d. Chinese legal tradition- People’s Republic of China (“PRC” ), Singapore, Taiwan.
3. Legal system- body of legal rules, both primary and secondary in character that define and govern legal relations within a particular political entity (most typically, a nation-state)
a. Primary-specific direction to persons who are subject to that legal system as to how to behave
b. Secondary-inform the persons within the legal system as to how the primary rules can be changed, adjudicated, and ultimately recognized as being legitimate and binding rules within the system.
4. Individual Laws
C. The Civil Law Tradition and the Family of Civil Law Systems
1. Significance and distribution
a. May be most significant because it is the most widely distributed
b. International commerce, LPA, and FDI are much more heavily influenced by civil law
c. Very adaptable, so each civil law country will have many variations compared to the next.
2. Thumbnail History
a. First life of Roman law- 450 bc- mid 6th century DE/AD
i. 450 BCE-Twelve Tables writes out main rules of civil procedure and civil relations (horizontal in nature-relations among people)
ii. 1st and 2nd Cents. CE-jurisconsults-gentlemen scholars (like lawyers) wrote down views on various Legal concepts and practice
iii. Early 4th century CE-Constantine laid foundations to make Rome Christian Empire. Christianity became main religion and infiltrated the institutions and law of Imperial Rome.
1. start of canon (religious) law to go with civil law
iv. 479 CE-Roman law began deteriorating as the Empire fell to the Germanic tribes.
v. 533 CE-Roman Emperor Justinian presided over publication of legal compilation made of four parts:
1. the Digest=most important/largest offered summary of best works by the jurisconsults
2. the Codex
3. the Institutes
4. the Novellae
b. Second life of Roman law
i. Late 11th century-Justinian’s digest rediscovered
ii. About 1140-Gration completes comprehensive Codification called “second subtradition” of the civil law tradition.
1. leads to hierarchy of law where legal scholars/ professors are at top and judges at the bottom.
2. Code is first word on the law
a. Then go to regulations
iii. 12th-17th century-much of Europe develops “jus commune” , or the ” Common law ” of Europe
iv. 1648-Peace of Westphalia-acceptance of nation-state as fundamental political unit in
Europe.
c. 5 subtraditions of the civil law
i. Roman civil law- see above
ii. Canon law- see above
iii. Commercial law – see Chap. 3
iv. Intellectual and political revolution of 18th Century Europe-sets stage for modern democratic principles in the law of European civil law nations (more influence on “public law” )
v. German Legal Science- reflects deep desire w/in civil law systems to create certainty in the legal rules that govern relations.
d. See song to remember dates.

Author: admin

Author: admin

Mentioned in these Entries

Codification, Commercial law, Common law, Customary International Law, General Agreement on Tariffs and Trade, International Organizations, Legal concepts, Patents, Statute of the International Court of Justice, Treaties, country.