Final Flashcards
What deals with the legal basis of global commercial relations?
-International Business Law
What are the sources of international business law?
- rulings from international tribunals
- customs
- treaties
- conventions
- trade agreements
Multinational corporations and enterprises have a limited presence in foreign markets through what?
- licensing intellectual property
- exporting and importing
- franchising
The regulation of multinationals is mostly a matter of what?
-domestic law
Generally, home states regulate what?
-the parent firm
Generally, the host states regulate what?
-foreign subsidiaries
Host states may also regulate the parent companies through a legal device called what?
-piercing the corporate veil (PCV)
Business that operate internationally face issues of what?
-regulations and licensing about imports and exports
Sometimes nations may require a foreign investor to accept a what?
-calvo clause
What is a calvo clause?
-an agreement that a business operating in a foreign country will not ask its home state to intervene in a dispute with the host state
What objections may states raise to complaints initiated against them?
- lack of standing
- lack of nationality
- lack of a genuine link to the sponsoring state
- failure to exhaust remedies
- Laches: negligent delay in bringing a claim
- dirty hands
A state that has harmed an alien may be required to pay what?
- restitution in kind
- compensatory damages
The economic interests of foreign investors may be harmed non-commercial risks, such as what?
-social and political upheavals
Non-commercial risks are usually addressed during what between who?
-ad hoc negotiations between the foreign investor and a host country
What are sources of insurance?
- private insurers
- governments and intergovernmental agencies
Insurance products include what?
- international property insurance
- international casualty insurance
- coverage for overseas employees
- special coverages (Kidnap, ransom, political, etc.)
To operate globally, large business organizations have modified their structures to do what?
- shares risks
- take advantage of the economies of scale
What is a non-multinational enterprise?
-a domestic firm that operates internationally through independent foreign agents
What is a national multinational enterprise?
-consists of one firm based in a country that acts as the parent company to operations in other countries through branches and subsidiaries
What is an international multinational enterprise?
-it has two or more parent companies in different countries. Possibly because of merges between parents
What are examples of International multinational enterprise?
-Unilever, Shell group
Where do the standards for ethical and legal behavior for multinationals come from?
- home governments
- international organizations
Section 1 of the Sherman anti-trust act forbids what?
-combinations and conspiracies in restraint of interstate and international trade
Section 2 of the Sherman anti-trust act forbids what?
monopolies and attempts to monopolize interstate and international trade
What expands the enforcement provisions of the Sherman Act?
-The Clayton Act
What does the Robinson-Patman Act forbid?
-price discrimination
To apply US Antitrust laws extraterritorially, it requires what?
- personal jurisdiction
- subject matter jurisdiction
What does Article 81 of the European Community Treaty forbid?
competitors entering agreements to prevent, restrain, or distort trade
What does Article 82 of the European Community Treaty forbid?
-dominant businesses from taking advantage of their position to the detriment of consumers
Multinationals are also subject to what?
-International tort and product liability laws
What is product liability?
the liability of a manufacturer for the injuries caused by its defective products
Product liability suits are based on what three theories?
- breach of contract
- negligence
- strict liability
The US and Britain apply how many theories of product liability?
-all 3
Which theory of product liability does the EU rely mostly on?
-strict liability
What refers to business dealings designed to obtain a benefit for a person or firm regardless of the means used?
-sharp practices
What means are included in sharp practices?
misrepresentation, fraud, bribery
What did the US enact to combat sharp practices?
-Foreign Corrupt Practices Act
Host states regulate multinationals by applying their own rules about what?
-unfair competition; sharp practices; implied consent; product liability; common enterprise liability; PCV
Compacts that serve as a guide for the transcultural corporate ethic include what?
- UDHR
- European convention on Human rights
- The Helsinki Final Act
- Organization for economic cooperation and development (OECD) guidelines for multinational enterprises
- international labor office tripartite declaration principles concerning multinational enterprises and social policy
- The UN code of conduct on Transnational corporations
The Transnational corporations guidelines fall into what five groups?
- employment practices and policies
- consumer protection
- environmental protection
- political payments and involvement
- Basic Human rights and fundamental freedoms
Multinational corporations should not contravene with what?
the manpower policies of host nations
MNCS should respect what?
- the rights of employees to join trade unions and bargain collectively
- host country laws and policies of consumer protection
- host country laws and goals regarding the environment
- rights of all persons
MNCS should not interfere with what?
intergovernmental relations
What are free zones?
-areas where goods may be imported and exported free from customs and tariffs
Why are free zones established?
-to attract investment
Who is involved in a free trade area?
-two or more states
What is a free city?
-an entire port city that has been opened to international trade
What is a free trade zone?
-a free zone located within or near a port city
What is the name of where manufacturing facilities process raw materials or assemble parts imported from abroad and then export the finished product?
-Export Processing Zones
What are found at international airports and harbors?
-Free retail zones/duty free zones
In France and Germany, every form of business organization must do what?
-register with the state
The form of a company takes influences what?
-the taxing possibilities
What case set precedents for how the relationship between the parent company and its subsidiaries affect how they are taxed?
Reiss and Co. v. Federal Board of Inland Revenue
Under what may a state tax the worldwide income of its nationals?
-Nationality principle
Under what may a state tax the worldwide income of persons residing within its territory?
-Residency principle
Under what may a state tax the income derived from sources within its territory?
-Source principle
What is double taxation?
-the payment of taxes on one source of income to two states
The basis of taxation may be defined by what?
-tax treaties
The OECD and UN tax treaties base taxation on what?
-the residency of persons within the contracting states
What are examples of tax incentives?
- income tax holidays
- capitol allowance for accelerated depreciation
- import incentives
- export incentives
- tax exemption for expatriate employee
Companies may indulge in tax avoidance/evasion through what?
- tax havens
- transfer pricing
- Arm’s length transactions
- treaty shopping
What is transfer pricing?
-charging higher prices in a high tax state in order to have smaller profits
What are Arm’s Length Transactions?
-treating affiliate firms as if they are unrelated
How do countries such as the US and Switzerland combat fraud and abuse by international taxpayers?
-either ordinances or common law principles of equity
Who has the primary purpose of improving working conditions and living standards of workers in all countries?
-International Labor Organization (ILO)
International labor standards are created by what?
- ILO conventions
- ILO recommendations
The member states of the ILO are required to provide what?
annual reports to verify compliance with the conventions
What is extradition?
A procedure under which a fugitive is lawfully sent to a requesting state
true or false: there is no global extradition treaty
true
True or false: there is no duty to surrender an individual to another nation
true
Some states may refuse or deny extradition on what?
political grounds
Instead of a global extradition treaty, there are what?
hundreds of bilateral treaties
What is a covert operations under which even an innocent person may be forcibly transferred to a state?
Rendition
A rendered individual is deprived of what?
access to a counsel and a hearing
When two states agree to establish diplomatic relations they exchange what?
representatives
Exchanged representatives can be named what?
-ambassador
minister
-head of mission
Normally, the second ranking official in the diplomatic delegation is called what?
charge d’affaires
true or false: no country has diplomatic offices in every country in the world
true
The US has how many embassies around the world?
140
How many embassies does the US host in Washington DC?
130
The process of exchanging diplomats begins with a what?
accreditation
true or false: the host country does not have to consent to the diplomat
false
When was the Vienna Convention of Diplomatic Relations?
1961
Under the Vienna Convention of Diplomatic Relations, a diplomat does what?
- represents the state
- protects interests of sending state
- negotiates with the government of the host state
- promotes friendly relations between the two states
When was the Vienna Convention on Consular Relations?
1963
Under the Vienna Convention on Consular Relations, consular officials are not usually what?
Diplomatic representatives
What are consular officials technically?
official agents of the sending state
Consular officials protect what?
The interests of the sending state and its nationals within IL
Consular officials issue what?
passports to nationals of the sending state; visas to the persons traveling to the sending state
Consular official promote what?
commercial, cultural, and friendly relations
Under what are embassies and consular premises the territorial extensions of the sending state?
International Law of Diplomacy
Which article of the Vienna Convention on diplomatic relations states “a diplomatic bag shall not be opened or detained?”
27(3)
Diplomatic immunity means what?
diplomatic agents are exempt from the operation of domestic law of the host nation
What are the two US laws that grant diplomatic immunity?
- foreign sovereign immunities act
- diplomatic relations act
Under the DRA, persons injured by diplomatic personnel have been denied what?
relief under US law
The major IL sources on diplomatic privileges and immunities are what?
- Vienna Convention on Diplomatic Relations (VCDR)
- Vienna Convention on Consular Relations (VCCR)
What provides that the authorities of the host nation may not enter the premises of a diplomatic consulate without permission?
Article 31 of the VCCR
Under the convention on the privileges and immunities of the UN, diplomats assigned to the UN and its subsidiaries enjoy what privileges and immunities?
- immunity from personal arrest or detention
- all papers and documents not to be violated
- exemption of diplomatic families from immigration restrictions
Who else enjoys diplomatic immunity?
international organizations, their agents, officials, and invitees
What is the citation for the International Organization Immunities Act?
22 USCA 8288
Crimes under IL may be prosecuted where?
national or international courts
In nost cases, a criminal conduct in international law may also be what?
a crime under national law
Much of international criminal law is based on what?
international humanitarian law
The 4 Geneva conventions on the laws of war authorize any state to do what?
try individuals who have allegedly committed grave offenses under the conventions
What did the Tokyo and Nuremberg tribunals prosecute individuals for?
- crimes against peace
- war crimes
- crimes against humanity
What articles of the Nuremberg charter provide that an individual charged with a crime cannot avoid responsibility by attributing his criminal conduct to orders from a superior?
5-6
Which article of the Geneva convention deals with general breaches?
2
Which article of the Geneva convention deals with violations of the laws or customs of war?
3
Which article of the Geneva convention deals with genocide?
4
Which article of the Geneva convention deals with crimes against humanity?
5