International Business Law and Ethics FINAL

Green Belt Movement

focused on tree planting to conserve environment and stem effects of deforestation and desertification

European Council Directive 2000/78/EC

prohibits employment discrimination on basis of religion/belief, disability, age, or sexual orientation

Company union

In China, 25 workers must join and employer must accept unionization, which is relatively simple. Sometimes employers will set up a company union.

Gray market/parallel trade

importation of merchandise produced and sold abroad and then imported back into US for sale in competition with the US trademark owner. Products imported back are gray market goods, or parallel imports

Franchising

doesn't involve technological complexity. Lessor allows the lessee to sell goods under trademark under franchise agreement. Conditions on observing standards. Tied purchase clauses require franchisee to buy certain goods from franchisor

Kyoto Protocol

failures: never ratified by US, and pollution reduction targets weren't assigned to developing countries including the world's largest greenhouse gas emitter, China.

Priority claim

if at least one of the applicants named in Patent Cooperation Treaty application is national or resident of PCT signatory, the PC gives application a priority claim on that invention in all signatory states. With a priority claim, the applicant business has up to 30 months after filing to begin administrative processing (prosecution of the application in the countries in which it wishes to obtain protection

Computer programs are...

...protected as literary works within the meaning of Article 2 of the Berne Convention

Ground Rules to Avoid Foreign Corruption

1) Avoid making direct payments to government officials, other than payments associated with the most ministerial aspects of clearing customs 2) Foreign agents should be carefully selected and even more carefully paid 3) Avoid "premium" transactions in nations with suspect reputations

Differences in regulatory schemes between countries

1. Cost-benefit analysis for environmental modification varies between countries 2. Countries that are happy with economic status quo favor environmental measures 3. Some countries lack technological infrastructure to produces goods without pollution 4. Some governments permit officials to profit from environmental modifications

Doha Ministerial Conference's two issues relating to geographical indications

1. Creating multi-register for wines and spirits 2. extending higher or enhanced level of protection accorded to wines and spirits under TRIPS to other products

Royalty

A US license for a fee, granted by a US firm to a foreign country. A license is a limited permission to use the US firm's trademarks, copyrights, or know-how in making products for sale in the vicinity of the foreign company's country. Or, the US company could provide IPR to foreign manufacturing plant that will fabricate the product for re-export back to the US concern

World Duty Free Company Ltd. v Republic of Kenya

Contract procured through fraud is void

Advertising Restrictions on Sin Products

Countries ban ads on tobacco/alcohol ads

Carlill v Carbolic Smoke Ball Co

Issue: whether it was a puff. Unilateral contract: by doing something, you are agreeing to terms of contract

Hazardous definition

There is no universal agreement on what is hazardous. Also no universal agreement on what management is sufficient for remediation of wastes (rendering them harmless to the environment)

A Bourjois & Co v Katzel

Us Co had trademark for face powder, then Katzel sold it in the US. Face powder takes reputation of plaintiff upon the character of the goods

Malgorzata Jany and others v Staatssecretaris van Justiti

Window prostitutes- is that enough economic activity to apply for residency? YES, because it's legal in Amsterdam.

Cap-and-trade regime

all energy producers have a cap on gases that they can produce, but can trade with others to get more cap room, aiming for 17% reduction in greenhouse gas emissions. Proposed by American Clean Energy and Security Act of 2009.

National treatment

an animating principle of all IP treaties, targeted discrimination against foreigners in obtaining patents

Sanders Amendment

bans import of any product made by forced child labor (Oct 1997)

Carpathian Convention

creates treaty obligations among the signatories to protect, maintain, and sustainably manage the natural resources of that mountain region. Specifically adopts 1. Precaution and prevention principles 2. polluter pays principle 3. public participation and stakeholder involvement in development initiatives in each country (which ends race to the bottom)

Extraterritoriality

extent to which US laws apply abroad and how to enforce. Aramco case- extended Title VII (Age Discrimination in Employment Act) to apply to firms operating outside US under control of US entity, and US citizens abroad. Neither Title VII nor ADEA apply to non-citizens employed outside US, but only those legally employed within US

Biopiracy

extracting native or indigenous plants and animals for research (with the help of local knowledge, alter the plant or animal (such as through genetic engineering), and then obtain patents related to this research without providing the host country with compensation or affordable access to the inventions

Countries require ______ on corporate board of directors

substantial employee representation

Grease Payments Exception

(Routine government action exception). In many countries petty graft is so common that to forbid U.S. companies from engaging in it would be tantamount to forbidding them to do business there. Accordingly, Congress excluded from the coverage of the FCPA"any facilitating or expediting payment...the purpose of which is to expedite or secure the performance of a routine governmental action, that must be non-discretionary

International Convention for the Protection of Industrial Property

*Paris Convention*. First IP treaty. Prepared in 1883. Guarantees that in each signatory country, foreign trademark and patent applications from other signatory countries will receive the same treatment and priority as those from domestic applicants

Three defenses to US challenges of employment decisions abroad:

1. The decision is made by a foreign person not controlled by an American employer 2. US Equal Employment Opportunity law (EEO law) conflicts with host county's laws, so that employer faces "foreign compulsion because complying with US law would violate the host countries laws 3. Performance of a job requires a trait (religion or gender) allowing employer the "bona fide occupational qualification" defense

_____ of union officials become executives in Japan

15%

Women on average earn ____ less than their male counterparts worldwide

18%

Foreign Corrupt Practices Act

1977- Congress' passed first law outlawing citizen's bribes to officials of other countries. For the first two decades, only US had a law. Then: Convention on Combating Bribery of Foreign Public Officials In Int'l Business Transactions became (Organization for Economic Cooperation and Development, or OECD) effective in 1999. Ratified by 34 member countries and 6 non member countries, and they make bribery of foreign officials a criminal act

Two forms of relationships with representatives

Agency (Business arrangement in which agent performs on behalf of principal) and Independent Contractor (perform general tasks but retain discretion and independence in carrying them out, like consultants). You can sue principal for acts of an agent, but not the independent contractor

The Guardian- BAE Systems to pay $79 mil fine

BAE admitted to making false statements over the sale of fighter planes to the Middle East and Eastern Europe. The latest penalty comes on top of $450m in fines from the US and Britain revealed by BAE last year. The fine is a positive that can allow the company to move on. The US operates under the International Traffic in Arms Regulations (ITAR). Rules control exports of defense products and often restrain the export of sensitive technology and data such as that used on unmanned aerial vehicles to other countries

Black Money Video

BAE, whose biggest customer is US government, was accused of corporate bribery. Landed an $80 billion jet fighter contract with the Saudis in exchange for providing the royal family with cars, chartered jets, and luxurious vacations around the world. Brought many jobs to the UK. Bribes used to be able to be deducted on tax return in US. FCPA applies to any person who has a certain degree of connection to the US and engages in foreign corrupt practices. When the UK signed an anti-bribery act, BAE moved their headquarters to Switzerland. FCPA can only go after the giver, not the taker, of the bribe

Domestic legislation (environmental issues)

Because international binding arbitration of environmental disputes is rare and timely, a more frequent method for counterattack is for conservation-minded country to enact domestic legislation outlawing importation of offending product

Greenhouse gas emissions

CEC committed to collaborate in improving data gathering, methodologies, and inventories of *greenhouse gas emissions*, which are concentrated gasses in the Earth's atmosphere derived from burning fossil fuels.

National Constraints on Exports

Cornerstone of US environmental regulation of hazmat exports is *prior informed consent*. US must obtain PIC of purchaser and give notice to official in receiving country before non-registered pesticides are exported.

Environmental Justice

Disparities in quality of environment based on race and class. NIMBY- not in my backyard. BANANA- build absolutely nothing anywhere near anyone

Reyes-Gaona v North Carolina Growers Ass'n Inc

Does Age Disability and Employment Act apply to foreign nationals applying in a foreign country for a job located in the US? NO.

Two problems with Paris Convention

Doesn't require any minimum substantive standard of patent protection, and lack of enforcement mechanism

Maternity leave

EU law provides minimum of 14 weeks maternity leave and an allowance of at least 75% or 80% of net salary. Pregnant workers can't be fired

Genetically Modified Organisms

Eu banned organisms that have been genetically altered. All GMOs along with irradiated food are considered "new food" and subject to food evaluation by European Food Safety Authority

Community Trademark Regulation

Europe's centralized multinational trademark registration system. Trademark prosecution is usually based on the law of the country where registration is sought. Com Trademark Reg is administered by Office for Harmonization in Internal Market (OHIM) and allows single trademark registration enforceable throughout EU

Peter Kang

IP is not real/tangible property. Types: Patents, Trade Secrets, Copyrights, and Trademarks. Patents: can be utility or design. 20 years for utility, 15 for design, which starts when application is filed. Doesn't give you power to make things, it gives you power to STOP OTHERS. Trade Secrets: last forever. Secret ingredient Copyrights: works of authorship. Life of author + 70 years Trademark: word, phrase, symbol, design that identifies source of goods. R= registered with government. TM= local level, anyone can do it. To trademark, you must be using it. It's indefinite as long as its in use. In order to prosecute: eligible subject matter, not anticipated, not obvious, enabled/written description.

Introduction to IP Video

Information wants to be expensive, because it's valuable. Criticism of technology is a longstanding argument. IP definition: "nonphysical property that stems from, is identified as, and whose value is based on an idea". SOme element of novelty. Only concreate, tangible embodiments of the idea are protected by IP law. Copyrights last for the life of the author + 70 years. *Fair Use Exception*- personal or publicaly beneficial uses.

Comite Interprofessional du Vin de Champagne v Wineworths Group, Ltd

Is term generic? Yes in Australia, but not in New Zealand. "seek injunction" means to stop someone from doing something. Calling Australian sparkling wine "champagne" is deceptive. Treaty of Versailles- US never ratified, grandfathered US champagne after the agreement

Amendment to China's 2008 Labor Contract Law

Labor dispatches shouldn't become main labor channel and all temporary laborers should receive payments, including all welfare and benefits, equal to permanent counterparts. This will directly impact firms in which there is a foreign investment, foreign-invested enterprises. These must hire through labor agencies

Caveat emptor

Let the buyer beware. Concept of libertarian capitalism. Buyers should investigate seller's claims or obtain contractural representations and warranties. "The invisible hand" of the market will eventually ferret out consistently dishonest sellers and consistently careless buyers

forum non conveniens

Lower courts rule on whether claims touch and concern US with sufficient force to displace court's presumption against extraterritoriality. Forum non conveniens can limit claims

100 year old loophole that makes CA champagne legal

Madrid Agreement laid the basis for modern international trademark recognition. Treaty of versailles is where the loophole was unintentionally opened that allows the continued existence of California Champagne. Article 275 was designed to establish that only sparkling wine from champagne could be labeled as champagne, was written because of a dispute between germany and france, but ultimately affected everyone of the treaty US signed the treaty, but senate never ratified it, but France didn't care because the US was entering prohibition. In 1983, Comite Interprofessionnel du Vin de Champagne (CIVC) was very loud during new negotiations. In 2005 US and EU reached an agreement - no longer use the semi-generic names from this point on; brands were grandfathered in

Mexico's Investigation in Wal-Mart Bribery Case

Mexico said it would open an investigation into allegations that the Mexican unit of Wal-Mart stores bribed officials to expand its business there, piling pressure onto the embattled retail giant. Walmart was also in trouble in the US for violating the FCPA. It could take years to complete investigations Walmart has a high-powered legal team investigating the allegations

Labor standards

Most US trade agreements include these. Typically aspirational, no monitoring or enforcement mechanism. World Bank incorporates labor standards as conditions of loans. Friendship, Commerce, and Navigation Treaties between US and other nations allow foreign employer to choose its own executives to run operations are highly scrutinized

Globalization not the culprit for our international woes

Most of america's economic problems are domestic issues not caused by globalization Although globalization is genuine, it has been distorted and its ills exaggerated The US has a low trade dependence compared to other countries; only 28% Domestic weaknesses: lackluster corporate investment in new plants and equipment; the slowdown in new business startups; the collapse of productivity growth; and large federal budget deficits The US dollar and exchange rates make the US manufactured goods and farm products less competitive on global markets The best thing that can be done to improve the US international competitiveness is to strengthen the domestic economy, which is the ultimate foundation on which its global dynamism rests

North American Envi Treaties

NAFTA's Environmental Side Agreements established North American's Commission for Environmental Cooperation in Montreal. Determines if party has shown a persistent pattern of failure to enforce environmental law

Niger Delta Pollution

Niger delta was a pristine paradise where people could fish every two years in order to earn more capital Taylor creek is a few kilometers away where an oil spill took place in 2012 They sometimes set the oil on fire to stop it from spreading, but the fire has other negative environmental impacts Eni owned an oil pipeline that went underground People would break into the pipe to sabotage it and steal the oil Eni issued a closure because the theft of oil, aka bunkering, was so rife People in the village think the pipes were just corroded and that caused the spill There is a high level of conspiracy between the security forces and the oil workers to steal the oil and that's why people are not prosecuted If the pond is polluted, hunger is the answer

FCPA Amendment

OECD convention requires that transnational bribery law apply to any person. FCPA was amended to provide jurisdiction for anyone "while in US territory", which DOJ and SEC interpret this broadly

International Monetary Fund

Officials will press for anticorruption reforms in countries seeking to borrow money. World Bank said if it finds evidence of corruption in any project, it will cancel the project.

Supersession of Agreement with Representative

Other countries have laws to protect local representatives. Law can state that it supersedes ANY agreement's language

60 Minutes: E-Waste Video

Over 100 million cell phones are thrown away each year in the US. E-waste/Recycling industry disposes of e-waste, some ship waste overseas to obtain precious metals from inside. One e-waste company, Executive, illegally smuggles trash to Far East like Hong Kong. Southern China = "Chernobyl of electronic waste"

EU Council Directive

Parties can agree to a fixed term contract, but if they continue relationship after contract, it becomes an *evergreen contract* and can only be terminated by a three month written notice once the relationship has lasted 3+ years. Also provides for *economic conditions alarm* - the principal must notify agent if it expects agent's volume of business (commission) will be significantly lower than what the agent normally expects

Dealer's Act

Prohibits principal from terminating agreement or from refusing to renew without *just cause*. Just cause is often difficult to establish, even non-performance/violation of contract isn't just cause unless principal can prove that breach affected it in a substantial manner

International Tribunals

Refused to enforce contracts based on bribery

Some laws require discrimination on ____ or _____.

Religion, national origin. This is to preserve ethnic identity

Prior approval

Requiring substantive prior approval from a governmental agency is a more intrusive type of regulatory scheme. Indicative of a relatively protectionist government policy.

Field of Use Limitations

Restricts applications for which the lessee may employ IPR

International IP Video

Set of int'l treaties = baseline. Most important right is national treatment. 90% of IP royalty/licensing fees are received by 5 developed countries. *Berne Convention* (1886) protects literary and artistic works. US joined 100 years later. Berne eliminates formalities, but no enforcement system (ICJ has been used 0 times). *TRIPS Agreement*, administered by WTO, has a strong enforcement policy. There are two "Internet Treaties" from WIPO. *Paris Convention* protects patents and trademarks but also lacks enforcement mechanism and sets no minimum standards. *Patent Cooperation Treaty* helps investors file multiple patent applications in various countries. *Madrid Agreement/Protocols* create common int'l registration system for trademarks. TRIPS extends protections to geographical indications.

WTO dispute settlement process

TRIPS provides mandatory mechanism for resolving disputes between WTO countries

Preliminary Injunction

Temporary injunction granted before or during a trial, to preserve status quo before final judgment. To get this, party must show that they will suffer irreparable harm unless the injunction is issues. May only be issued after a hearing. Decision is based on party's likelihood of prevailing at trial, extent of irreparable harm, and any other interests. May appeal. Governed by Rule 65a of Federal Rules of Civil Procedure

WTO Rules Against China on Rare Earth's Export Quotas

The WTO has judged that China's export restrictions on rare earth minerals are incompatible with its rules, marking the second time that beijing's use of export quotas and tariffs as an industrial policy tool has been successfully challenged China has control of international trade in rare earth materials, which have high-tech and military applications China had gradually reduced rare earths export quotas for several years in an effort to encourage more processing of the metals domestically China maintained that export quotas were necessary to limit environmental damage caused by mining and processing rare earths - but they were increasing the expansion of the domestic processing industry

Dependent-Independent Distinction

The retention of a representative often leads to principal liability, and triggers tax/labor law requirements which can be burdensome, especially if agent is dependent rather than independent

An approach centered on jurisdiction of US courts may be effective against US companies, but can't provide relief if no acts relating to environmental behavior _____ the US

Touched & concerned

Pollution credits

US and Canada argued that they should be allowed to purchase credits from countries with low emissions rather than meeting the goals immediately. Argued that they should be allowed to deduct from their emission totals carbon sinks (forests and farmlands that absorb carbon compounds)

Employment Discrimination

US has most comprehensive set of laws, since other countries are mostly homogeneous

Anticybersquatting Consumer Protection At

US was first to pass legislation to curb cybersquatting with this act in 1999. Prohibits registering, trafficking in, or using domain name with bad faith intent to profit from the goodwill of a trademark owner.

Underlying philosophical foundations

US- people don't believe any one is entitled to a job if they aren't productive. Europe- severance pay is compensation for taking of property, and increases with employee's age. Japan- your job defines you. Hold same job for a lifetime. China- "iron rice bowl", all jobs allocated through administrative bureau

Legal frameworks reflecting philosophy

US- terminate with little notice. Uk- employer consults with trade unions before dismissal. Germany- works council approves any dismissal. China- many conditions. Japan- written law permits dismissal, but tradition protects employees

Circle of Poison

US-banned pesticides exported to developing countries and used on crops that come back to the US

Puffing

Vagueness and exaggeration. Some countries are not tolerant at all

Exclusive rights

When exploitation of the licensed IPR requires significant financial or other resources of the lessee, it will demand exclusive rights in the IPR within some geographic area in order to enhance its chances of earning an adequate ROI. The lessor, on the other hand, may not want to put all its eggs in one basket

Binding adjudication

absence of agreement, so country may address neighbor's environmental pollution through dispute resolution mechanisms available under international law. Not common because no treaties, so pollutants don't consent to jurisdiction

Berne Convention for Protection of Literally and Artistic Works

deals with granting of copyrights among signatory countries. Based on national treatment scheme: each signatory nation must afford foreigners the same treatment as its own citizens. Requires signatory countries to enact certain minimum substantive laws

Two traditional remedies to problem of international pollution

litigation against polluters in affected country AND litigation against polluters in polluter's home

Single European Act

made the environment an official responsibility of the EU

notification-registration system

open to technological transfer. Japanese "gensoku kinshi" (prohibited in principle) system transformed into "gensoku jiyu" (free in principle). In essence, prior approval schemes often become replaced by simple registration procedure

Alien Tort Statute

permits non-US citizens to bring private cases of action in US courts based on torts (piracy) that violate norms of international law that are as widely accepted and definite as those recognized by Congress.

Anti-bribery Provisions

prohibitsUS firms from corruptly paying foreign officials for assistance in obtaining or retaining business. Also prohibits payments to a person when payer knew that portion of payment would go to a public official. *Alternative Fines Act* applies to all crimes that resulted in gains to a criminal, person can be fined up to twice the amount of the benefit

Hukou

registration of households. China's serious form of institutional discrimination. Categorizes citizens according to place of residence, dividing population into agriculture and origin. Mechanism for determining social entitlements

"First to file" rule

the Uniform Domain Name Dispute Resolution Policy set forth "first to file" rules, but excepted bad faith filings. This led to practice of cybersquatting, which is registering a domain name with intent to profit from goodwill of a trademark belonging to another

GATT agreement on Trade Related Aspects of IP Rights (TRIPS)

to cure defects of Paris/Berne Conventions. Requires all WTO members to abide by Paris/Berne conventions. Establishes 50 year copyright protection pursuant to the Berne Convention