CHP 7

Question 1

What are the 2 sources of law in international business?

Answer 1

Treaties and Customary International Law (CIL)

Question 2

What is a Treaty and provide and example?

Answer 2

agreements b/w countries also called conventions, covenants, compacts and protocols
Ex: NAFTA, EU

Question 3

What is Extraterritoriality ?

Answer 3

outside of a territory/geographical space

Question 4

What is Extraterritoriality application of laws?

Answer 4

countries attempt to enforce its laws outside their borders

Question 5

Give an example of of Extraterritoriality application of laws

Answer 5

US gov taxes imposed on US citizens and permanent residence regardless of source of income

Question 6

What is Sovereignty? give examples of countries

Answer 6

supreme power; solely responsible for things that happen within their borders
Mexico; US; Australia

Question 7

What is an example of sovereignty?

Answer 7

Government in America is only in charge of what is going on in US. there are some exceptions to concepts but majority is upheld

Question 8

In litigation, final decision on issues rests w/ _____; so its ___ to include in contracts the 2 major cautions

Answer 8

Courts; prudent

Question 9

What are the 2 major problems with litigation?

Answer 9

Which jurisdiction’s law should apply?

Where will litigation occur?

Question 10

What are the 2 solutions to the 2 litigation problems?

Answer 10

1. choice of law clause

2. choice of form clause

Question 11

What is Choice of law clause and give an example

Answer 11

which laws governs

US seller and Australian buyer, parties agree that Australian law will govern dispute

Question 12

What is Choice of form clause and give and example

Answer 12

Where disputes will be settled

US seller and Australian buyer, parties agree to have dispute decided in California state courts in LA country, Ca

Question 13

What are the 4 major problems to Performance of contracts?

Answer 13

1. Getting other side to perform obligations
2. no worldwide court has power to enforce decrees
3. UN international court of Justice relies on voluntary compliance
4. International contracts are complicated to enforce

Question 14

What are the 3 possible solutions to Performance of Contracts

Answer 14

1. UN Convention on International Sale of Goods (CIS)
2. Private Solutions-arbitration
3. Incoterms, the International Chamber of Commerce’s universal trade terminology

Question 15

What is the UN Convention on International Sale of Goods?

Answer 15

Standardized, in order to make uniform legal frameworks

Question 16

What is Private Solutions

Answer 16

an alternative to litigation; less expensive than going to court, doesn’t create media attention

Question 17

What is Incoterms

Answer 17

Standardized language and reduce non compliance

Question 18

What is the United Nations Solutions?

Answer 18

if engage in any kind of trade, if signed on the UN convention, there is a default pre-established list of obligations. creating standard expectation over time leading to compliance and reducing conflicts

Question 19

Arbitration is ____ and is ____ over litigation

Answer 19

Growing;preferred

Question 20

What is Arbitration?

Answer 20

process agreed by parties to a dispute in lieu of going to court, which neutral person/body makes binding decision

Question 21

What are some characteristics to Arbitration?

Answer 21

suspicion of foreign courts, faster, confidential, and less expensive

Question 22

What are some well known Arbitration?

Answer 22

International Chamber of Commerce in Paris; London and NY are also centers

Question 23

What is the Foreign Corrupt Practices Act?

Answer 23

US law banning payments to foreign government officials for special treatment to prevent bribes to avoid corruption

Question 24

What is Bribes?

Answer 24

questionable/dubious payments paid to officials by companies seeing to purchase contracts from them

Question 25

What is “Grease the process”

Answer 25

doing something, giving something/gifts, to get things moving

Question 26

What is the question concerning Bribes and Grease?

Answer 26

Where is the line drawn b/w both?