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1、Chapter 8Legal Environment Facing International BusinessLearning Objectives Fform a general picture of the two world legal systems in your mindFtell the differences between common law and code law system Funderstand the jurisdiction in international legal disputesFget familiar with the legal recours
2、e in resolving international disputesText:Legal System in International BusinessFBases for legal systemsCommon law-countries which have at one time been under English influence The basis for common law is tradition,past practices,and legal practices,and the legal precedent set by the courts through
3、interpretations of statutes,legal legislation,and past rulings.Civil law-the majority of the countries in the world Code law is based on an all-inclusive system of written rules(codes)of law.Under code law,the legal system if generally divided into three separate codes:commercial,civil,and criminal.
4、Text:Legal System in International BusinessFJurisdiction in international legal disputes One of the problems of international marketing is determining which legal system will have jurisdiction when commercial disputes arise.There is no international commercial law when international commercial dispu
5、tes arise,so the problems must be settled under the laws of one of the countries concerned.Jurisdiction over private,international legal disputes is generally determined in one of three ways:1)on the basis of jurisdictional clauses included in contracts,2)on the basis of where a contract was entered
6、 into,or 3)on the basis of where the provisions of the contract were performed.Text:Legal System in International BusinessFEnforcement of arbitration clause In most countries,arbitration clauses are recognized by the courts and are enforceable by law within those countries.Over 136 countries have si
7、gned a UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards which binds them to uphold foreign arbitrational awards.Because it established the original intent of the parties,an arbitration clause should be included in all international contracts.This alone may be sufficient to
8、 convince the parties to arbitrate whether or not the clause is legally enforceable.Summary of key points(1)FThere are two main legal systems in the world,common law system and the civil law system.The basis for the common law system are tradition,past practices,and legal practices,and the legal pre
9、cedent;while the civil law system is based on an all-inclusive system of written rules of law.FIn the performance of a business contract,the differences in the two legal systems may cause significant difficulties to the business people.Summary of key points(2)FLegal commercial problems between citiz
10、ens of different countries must be handled either in the courts of the country of one of the parties involved or through arbitration.FMany international business people prefer a settlement through arbitration rather than lawsuit because of the cost,delays and aggravation involved.FIn order to avoid
11、the problems when the parties involved in a arbitration fail to honor the awards,many countries make laws or sign international conventions to enforce the awards of the arbitrations.Key terms(2)Fprovision 法律条款Fdispute 纠纷Fact of God 不可抗力Fjurisdiction 司法权Farbitration 仲裁Flitigation 诉讼Flawsuit 诉讼Ftribun
12、als for arbitration 仲裁法庭Fmediation 调解Reading Comprehension(1)FExplain the following terms in your own wordsFcommon law Fprecedent Fcivil law Fact of God FjurisdictionFarbitration Fmediation FLawsuit Questions for DiscussionFDiscuss the advantages and disadvantages of common law and code law.FDiscuss
13、 this statement:“The national security that our export control laws seek to protect may be threatened by the resulting lack of international competitiveness of Chinese firms.”Essay questionFWrite an essay about 400 words to illustrate your idea on the following topic:How does the international legal
14、 environment affect the MNCss manager in the decision-making process?Case study:Sweatshop Economies FCase-related questions:FHave you even witnessed or heard about the conditions of sweatshop workers?FWhat factors do you think lead to the existence of these sweatshops?FWhat measures do you suggest t
15、o help eliminate the sweatshops or reduce the misery of their workers?PointFReligion is a basic element of human landscape across time and cultures.This is true even if we agree that economic and political change determines the strength or weakness of religious belief in respective cases.FLike many
16、other societies in the world today,America is and always has been deeply religious at many levels.FAmerica can be both religious and secular at the same time,since both are simply states of mind,and the same individual or group can be both in different contexts.FAs long as the government is not fund
17、ing or favoring religious institutions in some unconstitutional manner,religiously motivated political agendas,like secular ones,are entirely permissible.PointFWhile the US system is widely considered to be“democratic,”Americans sometimes vote in their politicians on religious grounds.FConcerning th
18、e idea of using of religion in political or election campaigns,it has the potential to do both good and harm.F there are many books out now about how politicians have manipulated religion for the sake of political gain.This will never stop as long as humans are humans,and it is the same with more se
19、cular ideas.The key word is manipulation,not religion.CounterpointFThe US is both a religious and a secular country,and each in its proper sphere.Civil law and the government of the United States must remain secular in order to guarantee the right of religious Americans as well as the non-religious
20、to freedom of conscience.FAmerica is full of very religious people who have an absolute right to believe as they wish.As long as it does not offend an overriding state interest,individuals also have the right to behave according to their own beliefs.FRecent attacks on secular law have been couched i
21、n terms of free exercise of religion.For a number of years,religion-based social service providers were careful to follow secular rules of employment when using government grant monies.Counterpoint FMany Americans vote for elected representatives based upon whether a candidate professes to share the
22、ir religious beliefs.The rationale is that if the candidate shares a theological belief system with the voter,then his or her votes on issues of importance will reflect a shared view.As many voters discover,this is not necessarily the case.FOne need only look at the deionization of minority religiou
23、s beliefs in theocratic nations to see that the question is not which religion should be imposed.The question,which we must answer“No!”,is whether religion should be entangled into government at all.Selected civil law and common law countriesFCivil lawlArgentinalBrazillChile lChina lEgypt lFrance lG
24、ermanylGreecelIndonesialIran lItaly lJapanlMexico lSweden lCommon lawlAustralialBangladeshlCanadalGhanalIndialIsraellJamaicalKenyalMalaysialNigerialSingaporelEnglandlUnited StateslZambiaNon-western legal systemsFNon-Western legal traditions include Islamic,Chinese and Hindu law.FIslamic law,called S
25、haria(Gods rules),is perhaps the most highly developed.Islamic law can have a direct impact on the way business is conducted in Muslim countries,such as Saudi Arabia and Sudan.FIslamic countries have introduced codes for the secular regulation of activities such an the formation and enforcement of c
26、ontracts,foreign investment and the employment of foreign workers,most now have secular tribunals in these areas.The growing impact of international law on businessFInternational law covers the body of rules recognized by the international community as governing relations between sovereign states.FW
27、hile states are still inclined to see national interest as paramount,they increasingly recognize that,in the long term,state interests are interdependent.FMost international law comes about through treaties and conventions,and most of these are the result of initiatives by UN-affiliated bodies.F Int
28、ernational public opinion encouraged by the many non-governmental organizations(NGOs)play an important role in putting pressure on governments to comply with the international law.Legal Framework of EUFFor each member state,the EU provides a growing source of law,which has become intertwined with th
29、eir own national law.FThe foundation Treaty of Rome 1957,referred to as the EC Treaty,has been greatly expanded,with articles renumbered,as a result o the Treaty of Amsterdam 1997.FThe law of the EU is still technically referred to as EU law.The current constitutional structure is the product of the
30、 Treaty of European Union 1992(TEU).International Business and Legal Risk(1)FInternational business may be exposed to legal risk in a number of ways:FContractual risks in overseas markets:for example in France and Portugal consumer contracts must be in the local language in order to be legally bindi
31、ng FProtection of intellectual property:trade marks registration both at home and in other countries where customers are located;copyright materials,such as software,also require protection;lax enforcement is a problem in many countriesInternational Business and Legal Risk(2)FRisk of liability for i
32、njuries and defective products and subsequent litigation in a foreign jurisdictionFRisk of infringement of data protection requirements,designed for protection and security for personal dataFRisk of dealings with local officials,especially where local regulation is complex and the possibility of cor
33、ruption arises;a firm could incur criminal liability under home country laws(for example the US Foreign Corrupt Practices Act)The International Covenant on Civil and Political Rights(2)FRight to just and favorable conditions of workFRight to fair wages and a decent livingFRight to join trade unionsF
34、Right to medical attention in the event of sicknessFRight to free primary educationFRight to take part in cultural lifeWebalertFa good source for international legal environment generally,including both national and international materialsFthe UNs main international law websiteF Fthe UNCITRAL home p
35、age Further readingFAdams,A.(1999)Law for Business Students,2nd edn(London:Longman)FAkdenix,Y.,Walker,C.and Wall,D.(eds)2000 The Internet,Law and Society(London:Longman)FKeenan,D.and Riches,S.(1998)Business Law,5th edn(London:Pitman)FSchaffer,R.,Earle,B.and Augusti,F.(1999)International Business Law and its Environment,4th Edn(Cincinnati:West)FWallace,R.(1997)International Law,3rd edn(London:Sweet&Maxwell)AssignmentFReview this chapter carefullyFFind an article on the topic of business legal environment from any resources that you have access to and write a brief summary of it.Thank You!