• What is the principle of comity, and What is the principle of comity, and why do courts deciding disputes why do courts deciding disputes involving a foreign law or judicial involving a foreign law or judicial decree apply this principle?decree apply this principle?• What is the act of state doctrine? In What is the act of state doctrine? In

what circumstances is this doctrine what circumstances is this doctrine applied? applied?

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 2

• Under the Foreign Sovereign Immunities Under the Foreign Sovereign Immunities Act of 1976, on what bases might a Act of 1976, on what bases might a foreign state be considered subject to foreign state be considered subject to the jurisdiction of U.S. courts?the jurisdiction of U.S. courts?• In what circumstances will U.S. antitrust In what circumstances will U.S. antitrust

laws be applied extraterritorially? laws be applied extraterritorially?

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 3

• Do U.S. laws prohibiting employment Do U.S. laws prohibiting employment discrimination apply in all discrimination apply in all circumstances to U.S. employees circumstances to U.S. employees working for U.S. employers abroad?working for U.S. employers abroad?

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 4

• The most important principles and The most important principles and doctrines applied in the interest of doctrines applied in the interest of maintaining harmonious relations maintaining harmonious relations among nations:among nations:–The Principle of Comity. –The Act of State Doctrine. –The Doctrine of Sovereign Immunity.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 5

• SourcesSources of International Law. of International Law.–International Customs: “evidence of a

general practice accepted as law.”–Treaties and International Agreements.–International Organizations.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 6

• International Principles and International Principles and DoctrinesDoctrines..–Principle of Comity. One nation will

defer and give effect to the laws and judicial decrees of another country, as long as those laws and judicial decrees are consistent with the law and public policy of the accommodating nation.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 7

• International Principles and DoctrinesInternational Principles and Doctrines (cont’d).(cont’d).–Act of State Doctrine: Judicial branch of

one country will not examine the validity of public acts committed by recognized foreign government within its own territory. Used in cases of expropriation, and confiscation.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 8

• International Principles and DoctrinesInternational Principles and Doctrines (cont’d).(cont’d).–Doctrine of Sovereign Immunity. This

doctrine exempts foreign nations from jurisdiction in U.S. courts.• The Foreign Sovereign Immunities Act

expanded the jurisdiction of U.S. courts for creditors of foreign governments.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 9

• Types of International Business Types of International Business Operations.Operations.–Direct Exporting. –Agency Relationship.–Distribution Agreement.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 10

• Types of International Business Types of International Business Operations (continued).Operations (continued).–Manufacturing Abroad.• Licensing.• Franchising.• Investing in a Wholly-Owned Subsidiary

or Joint Venture.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 11

• Nations Impose Laws and Controls to Nations Impose Laws and Controls to restrict or facilitate international restrict or facilitate international business.business.• Investment ProtectionsInvestment Protections: : expropriation is expropriation is

a major concern.a major concern.• Export ControlsExport Controls..–Incentives.–Subsidies.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 12

• Import ControlsImport Controls..–Quotas and Tariffs. Quotas limit the

amount of goods that can be imported. Tariffs are taxes upon imports.• CASE 27.1 United States v. Inn Foods, United States v. Inn Foods,

Inc.Inc. (2009). Why is having two sets of books illegal?

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 13

• Import ControlsImport Controls (cont’d). (cont’d).–Antidumping Duties: less than fair

value.• Minimizing Trade BarriersMinimizing Trade Barriers..–The European Union.–NAFTA.–CAFTA-DR.

• Bribing Foreign OfficialsBribing Foreign Officials..© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 14

• Contract ClausesContract Clauses..–Choice of Language.–Choice of Forum.–Choice of Law.–Force Majeure Clause (impossibility or

“act of God”).

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 15

• Civil Dispute Resolution. Civil Dispute Resolution. –Arbitration clauses.–United Nations Convention on the

Recognition and Enforcement of Foreign Arbitral Awards (the New York Convention).

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16

• Monetary SystemsMonetary Systems..–Foreign Exchange Rates/Markets.–Correspondent Banks (affiliated banks in

different countries).• Letters of CreditLetters of Credit..–Conditional promise by Issuer (Bank) to

pay Beneficiary (Seller) on behalf of Account (Buyer).

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 17

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 18

• Do U.S. laws apply to other nations’ Do U.S. laws apply to other nations’ businesses? businesses? • U.S. Antitrust LawsU.S. Antitrust Laws. . –Apply if foreign conspiracy has

substantial effect on U.S. commerce.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 19

• International Tort ClaimsInternational Tort Claims: often : often involve human rights allegations.involve human rights allegations.–CASE 27.2 Khulumani v. Barclay Khulumani v. Barclay

National Bank, Ltd.National Bank, Ltd. (2007). How did the bank collaborate with the apartheid regime?

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 20

• Antidiscrimination LawsAntidiscrimination Laws..–Generally, U.S. firms must abide by

U.S. anti-discrimination laws, even in their foreign activities, unless doing so would require them to violate the laws of the foreign country (the “foreign laws exception”).

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 21

• Antidiscrimination LawsAntidiscrimination Laws (cont’d). (cont’d).–Civil Rights Act of 1991 applies Title VII

extraterritorially to all U.S. employees working for U.S. employers abroad (apparently does not apply to domestic nationals working for U.S. firms).

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 22