Chapters 6-7 INTERNATIONAL POLITICAL AND LEGAL ENVIROMENT

1
Chapters 6-7 INTERNATIONAL POLITICAL AND LEGAL
ENVIROMENT
2
THE POLITICAL ENVIRONMENT (CH. 6)

• The Sovereignty of Nations
• Ultimate power of the state
• Stability of government policies
• Forms of Government
• Political parties
• Nationalism vs. patriotism
• Trade disputes, fear, and animosity
• Political Risks of Global Business

3
POLITICAL RISKS AND MODELS

• Definition and meaning
• Common political risks Confiscation,
  Expropriation, and Domestication
• Economic Risks Exchange controls, Local-content
  laws, Import restrictions, Tax controls, Price
  controls, Labor problems
• Risks from Civil Violence, NGOs, Terrorism, Cyber
  Crime
• Assessing political vulnerability/risk-forecasting
  risk
• Lessening political vulnerability
• Models Freedom House, Fraser Institute, Heritage
  Foundation, and International Country Risk Guide

4
LESSENING POLITICAL VULNERABILITY

• Good corporate citizenship
• Business strategies
• Joint venture
• Expanding the investment base
• Licensing
• Planned domestication
• Political bargaining
•  Government attitude and incentives

5
THE INTERNATIONAL LEGAL ENVIRONMENT (CH. 7)

• Bases of Legal Systems
• Common Law
• Code Law
• Theocratic Law (e.g., Islamic law)
• Marxist-Socialists Tenets
• International Legal Disputes
• Jurisdiction
• Conciliation (mediation)
• Arbitration
• Litigation

6
THE INTERNATIONAL LEGAL ENVIRONMENT (continued)

• Intellectual Property Rights
• Counterfeiting and piracy
• Inadequate protection
• International conventions
• Business on the Net Cyberlaw and unresolved
  issues
• Domain names
• Collection of sales tax or duties
• Contracts, jurisdiction, validity issues

7
LAWS AFFCTING BUSINESS

• Commercial Laws
• Company formation
• Marketing laws
• Antitrust laws
• Green marketing issues
• Foreign Corrupt Practices Act (FCPA)-extraterritor
  iality of U.S. laws
• Export restrictions
• Laws, procedures change, get updated from the
  Department of Commerce

8
Discussion Questions

• Define and explain political risk. How can we
  assess and lessen political risk in a country?
• Discuss and elaborate various economic risks
  companies face in international
  business/marketing.
• Explain the four types/bases of legal system. How
  do they affect international business/marketing?
• Explain how internet is influencing the
  commercial, legal and marketing environment.