Unit 3 - The Environment of International Business Flashcards
It refers to the surroundings.
Environment
It refers to the surroundings.
Environment
It means the factors/activities that surround or encircle international business
International Business Environment
This refers to factors that affect or influence multinational corporations.
Business Environment
This affects or influences the business from within. They include human resource management, trade unions, organizational structure, financial management, marketing management, and production management, as well as management/leadership styles.
Internal Environmental Factors
This includes customers, competitors, market intermediaries, raw material suppliers, finance providers, shareholders, and stakeholders.
Microexternal Environmental Factors
This includes social and cultural factors, technological, economic, political, and government factors, and international, and natural factors.
Macro-external Environmental Factors or External Macroenvironmental Factors
What does INTERNAL ENVIRONMENTAL FACTORS reveal?
Company’s strengths and weaknesses
What does MICRO and MACRO EXTERNAL ENVIRONMENTAL FACTORS highlight?
growth opportunities
This helps businesses develop effective strategies.
SWOT Analysis
These are forces in the global environment that directly increase or decrease a company’s sales revenues or operating costs
External Microenvironment
These are individuals and companies that provide a company with the resources that it needs to produce goods or services.
Suppliers
They are responsible for searching out the lowest cost, best quality inputs no matter where they are located.
Purchasing Managers of MNCs
They link companies that make products with the customers who buy them.
They make it easier for stores to locate the goods they will sell.
Distributors
They vie to obtain a larger share of the market.
Competitors
Unstable political environment may be caused by? (CAC)
- Civil difficulties
- Acts of terrorism
- Conflicts between countries in a particular region
It focuses on prosecuting individuals for serious crimes like genocide, war crimes, and crimes against humanity.
ICC (International Criminal Court)
It settles legal disputes between states and gives advisory opinions on international legal issues.
ICJ (International Court of Justice)
Nations that span in more than one continent.
These countries have territories located in two or more continents, often resulting in diverse cultures, languages, and geography.
Transcontinental Countries
Example: Russian (Europe and Asia) and Egypt (Africa and Asia)
Five biggest countries in the world by land area
- Russia
- Canada
- China
- USA
- Brazil
Group that is tagged by government as TERRORISTS
CPP-NPA (Communist Party of the Philippines - New People’s Army: armed wing)
Two main sources of political problems
Political Sovereignty
Political Conflict
It refers to a country’s desire to assert its authority over foreign business through various sanctions.
Political Sovereignty
T or F
Many of the less-developed countries impose restrictions on foreign business to protect their independence.
True
T or F
Among the developed countries, multi-nationalism of business is not politically acceptable and economically desirable.
False
It refers to an instant upheaval on a massive scale against an established regime.
Turmoil
It is a large scale, organized violence against a government.
Internal War
It represents an instant, planned act of violence against those in power.
Conspiracy
Direct effects of political conflict
a. changes in policy
b. violence against firms
B
Indirect effects of political conflict
a. changes in policy
b. violence against firms
A
It is a decision on the part of the host country government that may force a change in the operations, policies, and strategies of a firm.
Political Intervention
Ways on how a host country can intervene (IM LEP TED)
I - Import Restrictions
M - Market Control
L - Labor Restrictions
E - Expropriation
P - Price Control
T - Tax Control
E - Exchange Control
D - Domestication
This is the official seizure of foreign property by a host country whose intention is to use the seized property in the interest of the public.
- with prompt compensation at FMV in convertible currencies
Expropriation
It is a creeping expropriation.
It is a process by which controls and restrictions placed on a foreign firm gradually reduce the control of the owners.
Domestication
It is to regulate hard currency balances.
Exchange Control
It is to set quota.
It is to support native industries.
MNCs may be forced to depend on local sources of supply for the needed raw materials.
Import Restrictions
The government of a country sometimes imposes control to prevent foreign companies from competing in certain markets.
Market Control
An indirect way of warning that MNC is no longer wanted in the country.
When a country is in dire need of new resources.
Tax Control
Price regulations on basic commodities, utilities, and gasoline
Price Control
Presence of labor unions
Labor demands transformed into law
Labor Restrictions
Three types of political system
- Democracy
- Authoritarianism and Totalitarianism
- Monarchy
It is formed through regular elections and have different party systems that hold different views on how the country’s economy can be strengthened.
Democracy
Strict obedience and lack of personal freedom
Authoritarianism and Totalitarianism
It is rigidly regulated by complete government control of all business activities.
Communism
Examples: North Korea, Cuba, Myanmar/Burma
It is rigidly regulated by complete government control of all business activities.
Communism
Examples: North Korea, Cuba, Myanmar/Burma
Authoritarian regime
Dictatorship
Government whose ruler derives power through inheritance
Power is in a single individual
Monarchy
One head of state and head of the government
Pure/Absolute Government
One titular head of the state and one head of the government
Constitutional Monarchy
A group that commits unlawful acts just to promote their interests.
Terrorism
Symptoms that could point toward the instability of government (GAPCoPo)
- Government crises (opposition vs. government
- Armed Attacks by one group of people on another, or by groups from a neighboring country
- Public unrest (demonstrations, riots)
- Coup
- Politically motivated assasinations
Host country must manage its economy according to “______” and not by “_____.”
sound economic principles
political emotions
Most developing countries are afraid of ______ and ______.
domination
exploitation
It can be measured by its relationship with the rest of the world.
Has respect for international laws and membership in international and regional organizations.
International Stance of the Government
ASEAN countries (BCLIMMPSTV)
Brunei Darussalam
Cambodia
Laos
Indonesia
Myanmar
Malaysia
Philippines
Singapore
Thailand
Vietnam
Three reasons of having host country laws
- to control foreign businesses in their economies
- to allow reciprocity with nations on good trading terms
- may have political aims
Host Country Laws (FEAT)
- Tariffs
- Anti-dumping Laws
- Export/Import Licensing
- Foreign Investment Regulations
A tax that government levies om exports/imports.
Tariffs
Offering large blocks of production on a market at low prices to undercut competition
Dumping
Obtaining licenses before engaging in trade accross national boundaries
Export/Import Licensing
Includes policies on screening criteria, ownership, fiancé, employment and training, technology transfer, dispute settlement, etc.
Foreign Investment Regulations
The goods of material nature.
They can be perceived by senses.
Tangible Assets
The goods of immaterial nature.
They are incapable of being perceived by the senses.
Intangible Assets
It is acquired by occupation and intellectual creation.
Ownership (Article 712 of CCP)
_____ and _____ have become the most important resource, replacing land, energy, and raw materials.
Intellectual capital ideas
Innovations
Most important asset of a company
Intellectual Property
It refers to any creation or product of the human mind.
Intellectual Property
It may be expressed in the form of original ideas, expressions, and processes.
Intellectual Property
It describes ideas, inventions, technologies, artworks, music, and literature, that are intangible when first created, but become valuable in tangible form as products.
Intellectual Property
It is a specialized agency of the UN that aims to promote and protect intellectual property (IP) rights globally.
WIPO (World Intellectual Property Organization)
It comes from the Latin phrase, LITTERAE PATENTES, which means an open letter.
Patent
Such letters were used by medieval monarchs to confer rights and privileges.
With a royal seal, the letters served as proof of those rights, for all to see.
Patent
Patent - generally acknowledged that the first informal system was developed in _____.
Renaissance Italy
Patent system was introduced into the rest of Europy by ______ to protect their skills against those of local workers,
émigré Venetian glass-blowers
The first recorded patent of invention was granted to ______ by ______.
John of Utynam
King Henry VI
In 1449, John of Utynam was awarded a ______ for glass-making process.
20-year monopoly
These are supra-national patent-issuing authorities.
These bodies enable patent applications to be filed simultaneously in a number of countries.
European Patent Office and WIPO
Intellectual Property Code of the Philippines
RA 8293
It is the government agency in charged with the implementation of the law protecting intellectual property rights in the Philippines provided under RA 8293.
IPOPHL (IP Office of the Philippines)
Current director general of IPOPHL
Rowel Barba
It is the legal protection extended to the owner of the rights in an original work.
Copyright
This is a grant issued by the government through IPOPHL.
Patent
It is an exclusive right granted for a product, process, or an improvement of a product or process which is new, involves inventive step, and is industrially applicable.
Patent
Informations on the patent is available to the public through _____.
IP Philippines Official Gazette and Library
It is any technical solution to a problem in any field of human activity which is new (novel), involves an inventive step, and is industrially applicable.
Patentable Invention
Can an invention be considered new if it forms part of a prior art?
No
This is everything made available to the public by means of written description, oral description, by use, or any other way before the filing date of the application.
Prior Art
If you have already disclosed or published your inventions in a journal, demonstrate, sell or discuss your invention in public, you can still file a patent within _____ from the date of disclosure or publication.
Grace Period or Non-Prejudicial Disclosure of 1 YEAR
It is not obvious to a person skilled in the art.
Inventive Step
- Lacking an inventive step
- Does not go beyond the normal progress of technology
- Follows plainly or logically from the prior art
- Does not involve the exercise of any skill or ability beyond that to be expected of a person skilled in the art
Obvious
A fictional person with no inventive ability
Person Skilled in the Art
It is any tehcnical solution of a problem in any field of human activity which is new and is industrially applicable.
Utility Model
- Any composition of lines or colors
- Any 3D form
- Given special appearance and serves as pattern to an industrial product or handicraft
Industrial Design
- Any composition of lines or colors
- Any 3D form
- Given special appearance and serves as pattern to an industrial product or handicraft
Industrial Design
The design must be NEW or ORIGINAL, ORNAMENTAL, useful, and can be mass produced.
Industrial Design
Designs that are new and industrially applied to articles
Registrable Designs
Designs that are contrary to public policy or morality
Non-Registrable Designs
Are designs not new or original considered registrable designs?
No (Non-Registrable Designs)
Can registered designs be licensed or sold?
Yes
These are signs that are used to distinguish the goods or services of a company from those of others.
Trademarks
- Original topography (picture of a surface) of elements
- 3D disposition prepared for an IC intended for manufacture
Layout-Design or Topographies of Integrated Circuits
It is any visible sign capable of distinguishing the goods or services produced or provided by one enterprise from those of other enterprise.
Trademark
Your mark will not be registered if it is:
- Descriptive (describes the characteristics)
- Misleading (likely to deceive or have the tendency to misinform)
- Generic and customary to trade
- Contrary to public policy and morality (common in everyday language or usage)
- Marks that may cause confusion (identical)
Identify a good as originating in territory, region, or locality, where given quality, reputation, or other characteristic of the good is essentially attributable to its geographical origin.
Geographical Indications
