International Business Transaction
1/23/17
Private transactions that affect the interest of private or non-governmental parties.
One of the hallmarks of private law is that the parties have the freedom to contractually alter private law rights and obligations.
Focus is: negotiating, structuring, and implementing transactions against a background of private laws that allow for bargains altering rights and obligations by contract.
If you emailed an offer to a buyer in china, and the buyer in china emailed in acceptance in the offer, whose law applies and where the offer was made?
Private contract – we can say the law of cook county will apply. The law of IL will apply. Or somewhere else.
Battle on the international level.
If there’s a party in Germany and you do all things on the phone, is it binding?
CISG treaty applies to that phone call. No statute of fraud in CISG.
CISG: e.g. mistakes, your ad something for $700 but usually sold for $7000, what should you do to correct the ad?
Publish the correction.
What if it is an email? – have to honor it?
What about lawyers – ethical responsibility.
US: corporate counsel – yes – client privilege.
Europe: no – communication with in house counsel is not protected.
Cuz you are not independent professional – you are employee. You want protection, use outside counsel.
Different legal system.
Negotiating styles also different.
Problem: 1.1
If you are investing in China, we have to get approval from national govt, if less than 100 million, local govt can say yes. What should you do?
Foreign practice act – also the biz relationship.
Problem 1.3: depression era burger joint opened that in China?
Maybe the Texas thing Problem 1.4 might work in China, everything is bigger in Texas.
Outsourcing: sending your work outside U.S. There are Indian document review company.
Growth of International Biz: after WWII, IBRD, world bank,
Cultural revolution – China closed.
Then opened.
In 2009, China becomes the largest export.
Chart on page 14.
Merchants and acquisitions – eat up small
Greenfield investment – start from scratch. This is better for the new country.
Tech transfer
Role of multinational enterprises:
P24:
New Lex Mercatoria: merchant has always had their practices within themselves.
Industry practice among us: pay on the 15th.
Legal framework: multilateral treaties and etc, on page 25.
Check website for: UNCITRAL and UNIDROIT and International Chamber of Commerce.
Incoterms: page 29.
1/25/17
http://www.uncitral.org/uncitral/en/uncitral_texts/sale_goods/1980CISG_status.html
Signature: date signed
Ratification: parties to a multilateral treaty, created an original.
Accession: treaty already existing, I’m joining.
Succession: Union broke down, you succeeded to the treaty that previously applied to you.
Entry into force: when it is effective.
Case Law on UNCITRAL Texts (CLOUT):
UNIDROIT principle: English prevails if drafted in English.
International chamber of commerce: based in Paris. It has arbitration facilities.
https://www.hcch.net/en/home
HCCH: In Hague. Child abduction.
Arrest NY lawyer for litigating/conducting deposition without permission. You cannot just go, you need permission.
P23-47
UNCITRAl: United nations Commission on International Trade Law
Core legal body of the United Natio
If we want to excludes CISG, we say: we exclude CISG. CISG is part of the IL law, so you did not exclude it. (you need to figure out which provision you want to exclude and why) – never tested on the bar.
Relationship of sources of international law to domestic law
World Trade Organization (WTO): 4 major areas????? P35.
GATS:
TRIPS:
DSU:
WHAT IS The LAST ONE?
Preferential Trade Agreement:
The North American Free Trade Agreement – not a treaty. 51% in majority house, only btw two houses. NAFTA!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
A car manufactured in Detroit across the border to Canada up to 17 times during course of production because of the free trade agreement.
NAFTA Objectives
NAFTA Administration and Dispute Settlement: P39 – 40.
When you have dispute, you bring it to panel of arbitrators. They will give you decision. E.g.: You can be producer of a soft drink in U.S and sue Mexico. Your company v. Mexico. You go directly. It’s not country to country. You can say that Mexico injured me by increasing tax, they tax sugar. They increased the cost and decrease the value of my investment. You have the right to challenge. You have more right than a Mexico company because they don’t have an argument. “you diminished the value of my investment, under NAFTA I have the right to challenge.”
