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Questions and Answers
Which doctrine justifies jurisdiction based on the impact of actions on the country asserting jurisdiction?
Which doctrine justifies jurisdiction based on the impact of actions on the country asserting jurisdiction?
What was the result of the Morrison v. Australian National Bank case?
What was the result of the Morrison v. Australian National Bank case?
What is one of the challenges for businesses mentioned in the text?
What is one of the challenges for businesses mentioned in the text?
Which U.S. law is one of the oldest in combatting bribery, according to the text?
Which U.S. law is one of the oldest in combatting bribery, according to the text?
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In which case was the restriction trend on extraterritoriality suggested to persist?
In which case was the restriction trend on extraterritoriality suggested to persist?
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What trend has been observed post-Enron concerning ethics and business law integration?
What trend has been observed post-Enron concerning ethics and business law integration?
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What kind of instruments demonstrate the evolution from non-binding recommendations to enforceable law?
What kind of instruments demonstrate the evolution from non-binding recommendations to enforceable law?
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Which aspect creates challenges for companies caught between conflicting legal requirements?
Which aspect creates challenges for companies caught between conflicting legal requirements?
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'Grounds for Extraterritorial Jurisdiction' include which of the following?
'Grounds for Extraterritorial Jurisdiction' include which of the following?
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'Business and Human Rights, Financial Disasters: Law and Ethics' discuss the interplay between which two concepts?
'Business and Human Rights, Financial Disasters: Law and Ethics' discuss the interplay between which two concepts?
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The U.S. taxes its citizens based on their income only if they reside within the country.
The U.S. taxes its citizens based on their income only if they reside within the country.
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The Effects Doctrine justifies jurisdiction based on the impact of actions on the country asserting jurisdiction.
The Effects Doctrine justifies jurisdiction based on the impact of actions on the country asserting jurisdiction.
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Congress must clearly state its intention for extraterritorial application of laws.
Congress must clearly state its intention for extraterritorial application of laws.
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The U.S. Supreme Court ruled in the Kiobel case that a clear, explicit statement from Congress is not required for laws to apply extraterritorially.
The U.S. Supreme Court ruled in the Kiobel case that a clear, explicit statement from Congress is not required for laws to apply extraterritorially.
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Post-Enron, there has been a decrease in the integration of ethics into the business law framework.
Post-Enron, there has been a decrease in the integration of ethics into the business law framework.
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The OECD MNE Guidelines demonstrate the evolution from enforceable law to non-binding recommendations.
The OECD MNE Guidelines demonstrate the evolution from enforceable law to non-binding recommendations.
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The U.S. FCPA is considered one of the newest laws in combatting bribery according to the text.
The U.S. FCPA is considered one of the newest laws in combatting bribery according to the text.
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The Argentinian Bond Case suggests that extraterritoriality is no longer relevant in financial matters.
The Argentinian Bond Case suggests that extraterritoriality is no longer relevant in financial matters.
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The integration of ethics into business law creates no challenges for companies.
The integration of ethics into business law creates no challenges for companies.
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Cases like Chevron/Texaco in Ecuador highlight simple transnational disputes involving human rights with no complexity.
Cases like Chevron/Texaco in Ecuador highlight simple transnational disputes involving human rights with no complexity.
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In areas such as securities, taxation, banking, sanctions, export controls, and anti-corruption, laws have raised concerns for their broad reach in __________.
In areas such as securities, taxation, banking, sanctions, export controls, and anti-corruption, laws have raised concerns for their broad reach in __________.
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The U.S. taxes its citizens on worldwide income regardless of where they __________.
The U.S. taxes its citizens on worldwide income regardless of where they __________.
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The Effects Doctrine justifies jurisdiction based on the impact of actions on the country asserting __________.
The Effects Doctrine justifies jurisdiction based on the impact of actions on the country asserting __________.
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For extraterritorial application of laws, Congress must clearly state its __________.
For extraterritorial application of laws, Congress must clearly state its __________.
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Morrison v. Australian National Bank marked a significant limitation on the previous expansion of __________ jurisdiction.
Morrison v. Australian National Bank marked a significant limitation on the previous expansion of __________ jurisdiction.
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Cases like Kiobel and Daimler indicate a pullback on extraterritorial application for alleged human rights violations under the __________.
Cases like Kiobel and Daimler indicate a pullback on extraterritorial application for alleged human rights violations under the __________.
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Despite the trend of restriction, the Argentinian Bond Case suggests that __________ persists, particularly in financial matters.
Despite the trend of restriction, the Argentinian Bond Case suggests that __________ persists, particularly in financial matters.
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Post-Enron, there has been a trend towards integrating ethics into the business law __________.
Post-Enron, there has been a trend towards integrating ethics into the business law __________.
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Instruments like the OECD MNE Guidelines demonstrate the evolution from non-binding recommendations to enforceable __________.
Instruments like the OECD MNE Guidelines demonstrate the evolution from non-binding recommendations to enforceable __________.
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The OECD has played a significant role in combatting bribery, with the U.S. __________ being one of the oldest laws in this area.
The OECD has played a significant role in combatting bribery, with the U.S. __________ being one of the oldest laws in this area.
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What is the primary concern of courts and arbitral tribunals with regards to jurisdiction?
What is the primary concern of courts and arbitral tribunals with regards to jurisdiction?
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What varies among national laws in determining jurisdiction?
What varies among national laws in determining jurisdiction?
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Why is arbitration favored for international transactions according to the text?
Why is arbitration favored for international transactions according to the text?
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Which arbitration institutions are mentioned in the text as existing globally?
Which arbitration institutions are mentioned in the text as existing globally?
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What is generally easier compared to enforcing court judgments across borders?
What is generally easier compared to enforcing court judgments across borders?
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Which legal agreement simplifies jurisdictional issues within the European Union according to the text?
Which legal agreement simplifies jurisdictional issues within the European Union according to the text?
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In what aspect do civil law countries differ from common law countries regarding jurisdiction?
In what aspect do civil law countries differ from common law countries regarding jurisdiction?
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What is the purpose of the Doctrine of Forum Non Conveniens?
What is the purpose of the Doctrine of Forum Non Conveniens?
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Why is enforcement crucial after resolution in legal disputes?
Why is enforcement crucial after resolution in legal disputes?
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Which form of dispute resolution is non-binding but can lead to settlements based on compromise?
Which form of dispute resolution is non-binding but can lead to settlements based on compromise?
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What characteristic distinguishes the Doctrine of Forum Non Conveniens in common law jurisdictions?
What characteristic distinguishes the Doctrine of Forum Non Conveniens in common law jurisdictions?
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In which case did Taiwan successfully enforce an arbitral award, emphasizing the importance of considering enforcement prospects?
In which case did Taiwan successfully enforce an arbitral award, emphasizing the importance of considering enforcement prospects?
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What key role does mediation play in resolving business disputes?
What key role does mediation play in resolving business disputes?
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Why does the U.S. frequently utilize the Doctrine of Forum Non Conveniens?
Why does the U.S. frequently utilize the Doctrine of Forum Non Conveniens?
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Study Notes
Jurisdiction in International Business
- Jurisdiction is a primary concern in international business transactions, and its determination varies across countries
- Criteria for determining jurisdiction include personal jurisdiction and subject matter jurisdiction
- Civil law countries emphasize technical jurisdictional aspects, while common law countries consider territorial presence and due process
- The Brussels Convention simplifies jurisdictional issues within the European Union, favoring the defendant's home jurisdiction
Choice of Laws and Conflict of Laws
- After determining jurisdiction, the applicable law must be determined
- Parties can specify the applicable law in contracts to avoid conflicts
- Arbitration is favored for international transactions due to its potential for quicker decisions, confidentiality, and enforceability under the NY Convention
Other Forms of Dispute Resolution
- Mediation can facilitate settlements based on compromise, particularly in business disputes
Forum Non Conveniens
- This doctrine deals with conflicts of jurisdiction and is more common in common law jurisdictions
- It allows a court to dismiss a case if another court or arbitration tribunal is deemed more appropriate for resolution
Enforcement
- Enforcement is crucial after resolution, considering whether assets exist in a particular country to satisfy judgments or awards
- The case of Taiwan demonstrates successful enforcement of an arbitral award, highlighting the importance of considering enforcement prospects before pursuing litigation or arbitration
Comparative Law in International Business
- Law remains national or subnational, with international contracts being governed by these laws
- Understanding local legal traditions, including civil and common law, is crucial for international business operations
- Ignorance of local legal contexts can lead to serious issues, exemplified by international incidents and conflicts
Global vs. National Legal Systems
- Businesses and NGOs must navigate conflicts between acting globally and adhering to national legal systems
- Historical examples illustrate the challenges faced when national laws of one country confront the international operations of businesses, leading to legal and ethical dilemmas
Major Legal Traditions
- Civil law and common law are the two predominant legal traditions globally, with civil law being the majority
- Other traditions, such as Islamic, Asian, Socialist, and mixed jurisdictions, also influence national and business law practices
Role of History in Legal Traditions
- Civil law has roots in Roman law, canon law, merchant law, and codification processes, reflecting a history of legal evolution aimed at coherence and certainty
- The common law tradition is characterized by judge-made laws and the principle of stare decisis, with a significant role for juries
Common Law Summary
- Ancient law in England was displaced by Norman law after the conquest in 1066
- The development of common law under Henry II led to the creation of a unified legal system for England and Wales
- The legal profession concentrated in London, and Parliament emerged as a sovereign power
- Judicial decisions remained a significant source of law
- The US experienced a shift towards "social realism" in legal philosophy, acceptance of administrative law, and significant government regulation
Other Legal Traditions
- East Asian Legal Tradition: China's legal tradition was influenced by Confucianism, which won over legalist perspectives
- Historical "legal imperialism" and "legal orientalism" have shaped China's view of international law, with a focus on sovereignty and equality principles
- Modern China has seen the interplay of civil, socialist, revolutionary, and American legal influences, particularly in the field of international business law
Islamic Law and Business
- Islamic law has a significant impact on business practices in countries like Saudi Arabia and Iran
- Financing under Islamic law offers alternative opportunities, especially after the 2008 financial crisis
- Judges and Islamic legal scholars play a critical role in developing financing methods
- The prohibition of interest in Islamic law ("riba") is central to Islamic finance
Legal Professionals
- Roles in various jurisdictions vary, including the US, UK, France, Asia, Africa, and Latin America
- Judges have varying degrees of influence on law and legal culture across jurisdictions
- Other legal professionals, like notaires and huissiers, perform specialized legal tasks in certain countries### UN Convention on International Sale of Goods (CISG)
- Provides a harmonized legal framework for international sales of goods
- Applies unless parties opt out
Jurisdiction
- Foundational aspect of dispute resolution
- Court or tribunal must have authority to hear a case and render a decision
- National laws vary in criteria for determining jurisdiction
- Civil law countries emphasize technical jurisdictional aspects, while common law countries consider factors like territorial presence and due process
Choice of Laws/Conflict of Laws
- Once jurisdiction is established, the next question is which law applies to the dispute
- Parties can choose applicable law in contracts to avoid uncertainty
- In absence of choice, courts apply conflict of law rules to determine which jurisdiction's laws to apply
- Courts may need to apply a law that is not their own, which can be challenging
Arbitration
- Offers speed, expertise, flexibility, confidentiality, and ease of enforcement of arbitral awards
- Major arbitration institutions include ICC, AAA, and LCIA
- Enforcing foreign arbitral awards is generally easier compared to enforcing court judgments across borders
Forum Non Conveniens
- Doctrine allows a court to dismiss a case if another court or arbitration tribunal is deemed more appropriate for resolution
- More commonly used in common law jurisdictions
Enforcement
- Crucial final step in dispute resolution
- Judgment or award is only as good as its ability to be enforced against a party's assets
- Potential for enforcement should be a strategic consideration from the outset of any dispute resolution process
Extraterritorial Jurisdiction
- Concerns the application of a country's laws to activities outside its territory
- Nationality, effects doctrine, and explicit Congressional intent are grounds for extraterritorial jurisdiction
- Recent developments, such as Morrison v. Australian National Bank, have limited the scope of extraterritorial jurisdiction
Business and Human Rights
- Dynamic interplay between law and ethics in business
- Post-Enron, there has been a trend towards integrating ethics into the business law framework
- Challenges in business strategy include anticipating legal and ethical challenges in areas such as privacy, anti-bribery, and environmental and human rights violations
Comparative Law in International Business
- Understanding local legal traditions, including civil and common law, is crucial for international business operations
- Ignorance of local legal contexts can lead to serious issues
- Major legal traditions include civil law, common law, Islamic, Asian, Socialist, and mixed jurisdictions
Influence of History on Legal Traditions
- Civil law has roots in Roman law, canon law, merchant law, and codification processes
- Common law tradition is characterized by judge-made laws and the principle of stare decisis
- The passage of time and geopolitical shifts have affected the prominence of these traditions
Role of Legal Professionals
- Roles of legal professionals vary across jurisdictions, including the US, UK, France, Asia, Africa, and Latin America
- Lawyers have played significant roles in independence movements and have varying degrees of influence on politics and the legal system across Asia
Corruption and the Legal Profession
- Examples of corruption involving the legal profession in various regions
- Endemic court corruption is a significant challenge within the legal profession and judicial system### Comparative Law in International Business
- Comparative law is crucial in international business due to differences in national laws and legal traditions
- Understanding local legal traditions, including civil and common law, is essential for international business operations
- Ignorance of local legal contexts can lead to serious issues and conflicts
Common Law Principles
- Common law contract theory is largely "amoral" and influenced by economic liberal philosophy
- No concept of "fault" in common law contracts, unlike civil law
- A contract in common law requires a mutual intention to create legal obligations, manifested through offer and acceptance
- Consideration, or a bargained-for exchange, is generally required, but its importance has been diminished over time
- Contracts may be void from the outset or become void due to illegality, mistake, misrepresentation, fraud, or duress
Civil Law Principles (French and German Law)
- French contract law is codified, with Article 1134 of the Civil Code highlighting the freedom of contract
- Offer and acceptance are similar to common law, but there is no consideration requirement
- "Vices de consentement" are akin to common law's voidable contract principles
- German law is similar to French law, with the concept of "Culpa en contrahendo" for pre-contractual liability
- Commercial impracticability has been recognized due to historical economic conditions and the broad application of good faith in contract dealings
European Law
- The EU's core objective is to remove trade barriers, such as tariffs and customs duties, among member states
- National courts must interpret their own laws within the context of EU law, leading to complex interactions
- The free movement of goods has been largely successful, but the movement of people and services has encountered more challenges
International Contracts
- Certain areas of business have developed an internationally recognized legal framework, such as the Incoterms for trade
- Incoterms are crucial for allocating risk in international trade
- Payment and financing provisions are often integrated with Incoterms
- The documentary credit system relies on letters of credit, which have a long history and are crucial for international trade
Jurisdiction
- Jurisdiction is foundational because a court or tribunal must have the authority to hear a case and render a decision that will be recognized and enforceable
- Different countries have different rules for asserting jurisdiction, which can lead to jurisdictional conflicts
- The Brussels Convention and its successor, the Brussels I Regulation, simplify jurisdictional issues within the EU
Choice of Laws/Conflict of Laws
- Parties can often choose the applicable law in their contracts, which helps avoid uncertainty
- In the absence of choice, courts will apply conflict of law rules to determine which jurisdiction's laws to apply
- Applying foreign law can be challenging, especially when that law is from a different legal system or in a different language
Arbitration
- Arbitration can offer speed, expertise, flexibility, confidentiality, and ease of enforcement of arbitral awards
- Several institutions specialize in administering international arbitrations, including the ICC, AAA, and LCIA
- These institutions provide frameworks for the arbitration process that are recognized globally
Dispute Resolution
- Mediation is a non-binding process where a neutral third party helps the disputing parties reach a settlement
- The doctrine of forum non conveniens allows a court with jurisdiction to dismiss a case if there is a more appropriate forum available to the parties
Enforcement
- Enforcement is a crucial final step, and the potential for enforcement should be a strategic consideration from the outset of any dispute resolution process
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Test your knowledge on the UN Convention on the International Sale of Goods (CISG) and the importance of jurisdiction in international sales. Explore topics such as the legal framework, jurisdictional matters, and the significance of national laws in international trade disputes.
