INTL LAW EXAM 3

Franchising

Licensing outside the technological context, an arrangement in which the licensor permits the licensee to sell certain goods under the licensor's trademark or service mark under the terms of a franchising agreement

Trademarks

- Paris Convention - Right of priority to a trademark holder if the foreign registrations are made within six months after the original registration - Madrid Protocol - WIPO administers the prosecution and notifies designated countries

TRIPS

- Requires every member of the WTO to abide by the Paris and Berne conventions - 50 year copyrights protection - Patent protection

Field of use limitations

restrict the applications for which the licensee may employ the IPR

Mobile Communications Service Inc. v. WebReg, RN

Domain name transferred to complainant mobile communications service

Sebago Inc. c. GB UNIE

EU Trademark's directive to permit reimport from one union country to another, but to forbid reimport from other countries - "regional trademark exhaustion"

Notification-registration

a system more open to technological transfer but still only make exceptions for areas with high concern

Expropriation

a taking of an isolated item of property, merits full compensation

Repatriated

paid out to the U.S. person, typically in the form of a dividend

Inconvertibility/non transfer policy

a type of political risk insurance, investors can purchase to insure against hard blockages or soft blockages

Privatization

can be accomplished by the outright sale of assets or ownership interests in a state-owned enterprise being sold to private investors, by granting concessions that allow private entities to operate and derive profit from state-owned infrastructure

Franchise tax laws

can impose taxes based on the franchisor's worldwide operations even if its local operations fizzle

Passive investment

can involve a passive debt investment (making a loan to a foreign business) or a passive equity investment (purchasing an equity interest in the foriegn business as a portfolio investment

Countertrade

payments to the franchiser with goods instead of hard currency

Unitary index adjustment

formulaic adjustment of payment terms based on an accepted unitary index

Patent Law Treaties Implementation Act of 2012

harmonizes IS law for design patents

Currency exchange rights

if an investor proposes bringing a desired industry to the soft-currency nation it can negotiate with the government in advance for preferential access to hard currency

Toxic Substances Control Act

imposes reporting and record-keeping requirement on all chemical substances

Bad faith

intentional wrongful behavior, includes some negligence without a finding of intent

Counterpurchase agreement

involves the sale of goods to a buyer, often a foreign government which requires as a condition of the sale that the seller buy other goods produced in that country

Paris Convention

- Convention for the Protection of Industrial Property - Each country must give the same intellectual property protection to the other countries - Targeted discrimination against foreigners in obtaining patents

Uniform Domain Name Dispute Resolution Policy

"first to file" rules for domain names, but accepted bad-faith filings

Gray Market

(parallel trade) the importation of merchandise produced and sold abroad and then imported back into the United States for sale in competition with the U.S. trademark owner Gray market imports/parallel imports

Patent Cooperation Treaty

- established a centralized utility patent application process - PCT application is filed on a standard form with WIPO - priority claim

Copyright Term Extension ACt

- mickey mouse act - copyrights are protected for 70 years after authors death or 95 from publication

Transfer firms

1. International IPR clearinghouse 2. International IPR brokers 3. IPR aggregation funds for open source software 4. Firms that identify and acquire patents for the purpose of preventing violations and litigation costs

Methods of FDI

1. Opening a foreign Branch or Forming a new Foreign Subsidiary 2. Acquiring a Foreign Branch 3. Joint Ventures

Mechanics of IPR Transfer Regulations

1. Pre Approval 2. Notification-registration 3. No regulation (good for entrepreneurship)

Copyrights

The Berne Convention

Prior informed consent

The Federal Insecticide, fungicide, and Rodenticide Act requires that before a U.S. seller can export pesticides that are not registered fro use in the United States, it must obtain the PIC of the purchaser and give notice to the appropriate official in the recieving country

Joint Commission on Commerce and Trade

U.S. uses to get results on IPR protection and enforcement

K Mart Corp. v. Cartier Inc.

US supreme court allowed the entry of gray market imports as long as the foreign manufacturer and the domestic trademark owner were subject to common control

Currency swaps

a broad assortment of financial contracts purchased from financial intermediaries to hedge against fluctuation risk

Royalty

a license fee

Grant back

a licensor may seek a grant back of ownership in or at least the right to use - often without compensation - such new technology

Vorstand

a management board that manages the firm from day to day

Geographical indications

a product, particularly a wine or liquor, is marketed by reference to a geographic location

Worldwide system

all income earned anywhere in the world, regardless of source, by U.S. persons is taxable by the U.S. government

Formulary Apportionment System

all income earned by a person is put in a single category and then it is apportioned between the various nations that have some claim to tax the person on the basis of a predetermined formula that relies on factors such as proportion of sales, assets, or payroll location in a jurisdiction

Reinsurance treaty

an agreement among insurance companies that spreads the risk among its members

Multilateral Investment Guarantee Agency

an independent affiliate of the world bank, issues insurance guarantees to protect foreign investors from losses relating to political risk issues (15 year term)

patent protection

at least 20 years, available for "any new inventions whether products or processes, in all fields of technology, provided that they are new, involve an inventive step (nonobvious) and are capable of industrial application (useful)

Friendship, Commerce, and Navigation treaties

between the United States and other nations allow a foreign employer to choose its own executives and experts to run its operations in the other signatory nations

Soft blockages

delays in processing conversion requests by the local authorities

Barter

direct exchange of goods for goods (or services)

Bona Fide Occupational Qualification

employer may engage in discrimination if it is "reasonably neccessary to the normal operation of the particular business or enterprise"

Geneva Act

established protection of Design Patents

FRAND

fair, reasonable, and nondiscriminatory licesning that can significatly reduce the risk of patent "hold-up" and the perceived advantages of litigation

Foreign Sovereign Immunities Act

foreign states are generally immune from jurisdiction of U.S. courts unless: - The foreign state waives immunity - The state's action constitutes "commercial activity" carried on by the state - Rights in property are taken in violation of international law - Rights in property are acquired through inheritance or gifts of the US - The suit involves non commercial torts within the us - The suit involves maritime liens based on the foreign state's "commercial activity" - The suit involves certain types of counterclaims and the foriegn state instituted the lawsuit against a US citizen

Aufsichtsrat

large supervisory board that represents shareholders' interests

Language politics

laws requires that companies conduct business in a certain language, system franchisers beware

Restatement (Third) of Foreign Relations Law

less than full compensation may be acceptable in "exceptional circumstances" such as agricultural land reform

license

limited permission to use the U.S. firm's trademarks, copyrights, know-how in making products for sale in the vicinity of the foreign company's country

Foreign Tax Credit

limits U.S. worldwide taxation to reduce the incidence of double taxation the U.S. offers a dollar-for-dollar tax credit for foreign income taxes paid on foreign source of income

Geographical limitations

limits the licensee's sale of that IPR within a specific region

Prior Approval

more intrusive type of regulatory scheme, indicative of relatively protectionist government policy

All-China Federation of Trade Unions

national labor organization shapes the local work council's efforts

Kiobel v. Royal Durch Petroleum Co

nigerian citizens sued for abuse/crimes, US supreme court dismissed the case for failure to state a cause of action because of forum of non conviens

Hard blockages

occur when a foreign government passes a law that prevents conversion or transfer

Soft currency

one that is not freely exchangeable for currencies of other nations

Apple v. Samsung

originally granted apple damages for samsung's infringement on their design patent of a rectangular phone, but it was later reversed saying they did not have a patent

Modern-traditional theory

permits takings but imposes certain requirements on the nation exercising its takings power 1. Must be for public purpose 2. Nondiscriminatory 3. Accompanied by prompt, adequate, and effective compensation

Lloyd's of London/insurance syndicates

pools of money provided by investors to insure specific projects - provide such insurance on a case-by-case basis

Anticybersquatting Consumer Protection Act

prohibits registering, trafficking in, or using a domain name with bad faith intent to profit from the goodwill of a trademark owner

Overseas Private Investment Corporation

promote exports by insuring domestic firms that do business abroad against expropriation, nationalization, revolution, insurrections, and currency inconvertibility

Export credit agencies

promote investment from their own countries

Madrid Protocol

provides a centralized filing system on a standard form and a designation of the countries in which trademark registration is sought

Cybersquatting

registering a domain name with the intent to profit from the goodwill of a trademark belonging to another, then sells for inflated price

Tied-purchase clauses

require the franchisee to buy certain goods from the franchiser (competition laws)

Resource Conservation and Recovery Act

requires that the exporter to provide notice to the EPA of any forthcoming shipment, then the government of the receiving country must expressly accept the shipment and provide written consent to EPA

Active investment

results in a U.S. investor having an ownership interest in the foreign business as either a foreign branch or subsidiary , the assets of the business will be legally owned by a business entity organized under the laws of the foreign host country

Nationalization

taking of an entire industry or natural resource as part of a plan to restructure the nation's economic system

Deferral Principal

tax from foreign corporation will be deferred until it is repatriated

Import substitution rights

the U.S. investor may seek these if the preferential currency exchange rights are not available, these rights are available when the new venture will manufacture a product in the soft-currency country that the nation had previously imported

Section 301 of the Trade Act of 1974

the USTR publishes the Special 301 report that is an annual review of the global state of intellectual property rights

priority claim

the applicant has up to 30 months after filing to begin administrative processing (prosecution) of the application in the countries in which is wants to obtain protection

Rights of priority

the date of an applicant's foreign application is deemed to be the same as the date of the applicant's original application on the same invention, so long as the foreign applicant's was filed before the first anniversary of the original application

Creeping expropriation

the effect of laws and regulations that subject the investor to discriminatory taxes, legislative controls over management of the firm, price controls, forced employment of nationals, license cancellation, and restriction on currency convertibility

German Works Constitution Act

the employer must inform and cosult with the works council before anything is done

Trade creditors

the entities that sell supplies or services to the venture

Foreign Direct Investment

the investor owns and actively controls the productive assets of ongoing business concerns in a foreign country ( the investing business carriers on operations directly in the host country)

Informal Consortia or Parallel Exchange

the investors - all committed to the local incontrovertibility risk - spread that risk over a larger group, with the hopes of reducing the vagaries of local bureaucracy

Output or customer restrictions

the licensee will be expected to pledge its "best efforts" to develop a market for the products manufactured with the IPR and mist meet specific marketing targets under pain of losing its license

Fluctuation risk

the possibility that the currency of the country in which the U.S. investor has put its money will devalue against the U.S. dollar

Profit margin preservation

the price or payment to the foreign investor will be adjusted periodically to maintain the same profit margin (discloses foreign company's cost structure)

ADC Affiliate et al. v. The Republic of Hungary

the privatization of the airport was a violation of the agreement the investors - unlawful expropriation

Buy-back agreement

the provider of the equipment or technology used in manufacturing will receive, as its payment, a portion of the goods manufactured by the supplier's equipment of the factory in which the equipment is installed

Hukou

the registration of households that categorizes citizens according to their place of residence, essentially dividing the population into agriculture and urban, mechanism for determining social entitlements

Currency risk

the risk that profits in the foreign host country's currency will not translate into equivalent profits in the investor's home country

Political risk

the risk that profits will be affected by changes in the host country's political structure or instability

Inconvertibility risk

the risk that the government of a country with "soft currency" will hinder the U.S. entrepreneur from trading the foreign currency back to U.S. dollars

Biopiracy

they extract plants and animals indegenous to the emerging nation 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

Anti-Counterfeiting coalition

trade group that pressures governments to enforce IPR laws

Exclusive rights

within some geographic area in order to enhance its chances of earning an adequate return on its investment