Chapter 7 Flashcards
World’s different legal system based on 4 heritages
- ) Common Law
- ) Civil or Code Law
- ) Islamic Law
- ) Marxist-Socialist Tenets
a country’s laws may be based on one of the four legal systems, but __________ may vary
individual interpretation
Seeks interpretation through the past decisions of higher courts which interpret the same statues
Common Law
Are recognized as not being all-inclusive
Common Law
Intellectual property ownership is established by use
Common Law
Legal system is generally divided into three separate codes
Code Law
three separate codes of Code Law
- ) commercial
- ) civil
- ) criminal
Considered complete as a result of catchall provisions found in most code-law systems
Code Law
Intellectual property ownership by registration
Code Law
Official name of Islamic Law
Shari’ah
basis of interpretation is the Koran
Islamic Law
prescribes specific patterns elf social and economic behavior for all individuals
Islamic Law
Islamic Law prohibits the
payment of interest
Islamic Law also prohibits
alcohol, gambling, and casinos
are increasing their trade with non-Marxist-Socialist countries
Marxist-Socialist countries
had to be developed that allowed international commerce
Commercial legal systems
Pattern for development
varies among countries
used pre-WWII laws; easier transition
Czech Republic and Poland
had to start from scratch; slow and disjointed; Big Problem- Vaguely worded laws
China and former Soviet Union
judicial body exists to deal with legal commercial problems arising between citizens of different countries
There is no judicial body to handle disputes
Legal disputes can arise in three situations
- Between governments
- Between a company and a government
- Between two companies
Jurisdiction is generally determined on the basis of:
- Jurisdictional clauses included in contracts
- Where a contract was entered into
- Where the provisions of the contract were performed
Disputes tend to arise in international trade when
- the buyer refuses to pay,
- the product is of inferior quality, or
- the shipment arrives late
First step of International dispute resolution
informal resolution
If no information resolution, three ways to deal with international disputes:
- Conciliation
- Arbitration
- Litigation
Also called mediation
Conciliation
A nonbinding agreement between parties to resolve disputes by asking a third party to mediate differences
- Sessions are private
- All conferences between parties and the mediator are confidential
Conciliation
conciliation is preferred by the _____
Chinese
should be included in all conciliation agreements
an arbitration clause
is not legally binding
conciliation
Parties involved select a disinterested and informed party as referees to determine the merits of the case and make a judgment that both parties agree to honor
arbitration
The popularity of arbitration has led to a proliferation of
arbitral centers
should be used in contracts and legal documents
arbitration clause
Arbitration clauses require agreement on two counts:
- To use arbitration process to settle dispute
- To abide by the awards resulting from the arbitration
a last resort to conflict resolution
litigation
deterrents to litigation
- Fear of creating a poor image and damaging public relations
- Fear of unfair treatment in a foreign court
- Difficulty in collecting a judgment that may otherwise have been collected in a mutually agreed settlement through arbitration
- High cost and time required
- Loss of confidentiality
Inventions, literary and artistic works, and symbols, names, images, and designs used in commerce
intellectual property
Companies spend millions of dollars on
- Establishing brand names or trademarks
- Research to develop products, processes, designs, and formulas
are among the most valuable assets
intellectual or industrial properties
companies must be vigilant against
piracy and counterfeiting
can do serious physical harm
counterfeit drugs
protection of intellectual property rights must protect against:
- counterfeiting and piracy
- inadequate protection
first company to use IP owns it (prior use)
Common Law
first company to register IP owns it (registration)
Code Law
Responsible for the promotion and protection of IP and administration of treaties
World Intellectual Property Organization (WIPO)—UN
Most comprehensive multilateral agreement on IP
Trade-Related Aspects of Intellectual Property Rights—WTO
must be in use in some countries
patents and trademarks
IP approach in some countries
charge what market will bear -Warner Bros.
has no political or national boundaries—truly global
the internet
Register and hold Web names then sell them at an inflated price
cybersquatters
Companies were deemed to have a__________ in a country it they had a permanent establishment there
taxable presence
are making substantial progress
digital contracts
have laws regulating marketing activities
all countries
marketing activities
- Promotion
- Product development
- Labeling
- Pricing
- Channels of distribution
Premiums, free gifts, and coupons prohibited
Austria
Claims and statements must not be misleading and uses the “credulous person standard”
Canada
Censorship of advertising
China
U.S. products must now comply with
stricter EU standards
focus on environmentally friendly products and product packaging
green marketing laws
Manufactures, distributors, and retailers must accept returned packaging materials
Germany
requires car manufactures to take back cars that no longer have resale value
EU (Green Marketing Law)
Foreign Corrupt Practices Law
anti-bribery law
Designed to combat restrictive business practices and to encourage competition
antitrust laws
U.S. companies are forbidden to participate in an
unauthorized foreign boycott (anti boycott law)
No export license is needed for a business, but a license may be required for
certain exports to certain destinations
who’s responsibility is it to know which exports require a license
the exporter
National Security Laws
- U.S. firms, their subsidiaries, or their foreign licensees cannot sell particular products to certain countries
- Restriction extends to the final destination, not just countries in which exports are directly shipped
- Components of weapons of mass destruction may have dual purpose
