Ch 6-Political Environment

Question 1

What is sovereignty?

Answer 1

Right that every country has to be rules and to be independent of external influences (when a country is sovereign, others are not allowed to interfere in local politics)

Question 2

Under what conditions do nations give up part of their sovereignty?

Question 3

What is extraterritoriality?

Answer 3

When a country wants to make its laws apply outside of its territory

Question 4

What are 4 U.S laws that are extraterritorial?

Answer 4

Sherman antitrust act
U.S income tax code
Helms Burton Act
Foreign Corrupt Practices Act

Question 5

What does the Sherman Antitrust act do ?

Answer 5

Prohibits monopolies + attempts to monopolize. The U.S applies this to any company overseas that influences business in the U.S.

Question 6

What is the U.S income tax code ?

Answer 6

Wherever you go, you have to pay taxes. Sometimes this results in double: country of residence + U.S.

Question 7

What does the Helms Burton Act do?

Answer 7

Any investment by foreign company into property formerly owned by uS org or person in Cuba is prohibited under penalty. The idea is to prevent foreign investments in Cuba.

Question 8

What is the foreign corrupt practices act

Answer 8

Strongest anti bribery law in the world

Question 9

What is the main political condition Multi-National Corporations (MNC’s) want when working overseas?

Answer 9

-That the country they are entering does not change the laws once operating there
-Want predictability and stability

Question 10

What is Confiscation?

Answer 10

No payment for your asset
Foreign gov takes over property + does not make payments for it