What To Consider When Conducting Business Globally From An International Law Attorney
It’s no secret that a key to business success is how well you manage risk. Yet, as businesses expand globally, the complexities of how they conduct trade increase exponentially. Whether you’re a U.S.-based business operating globally or an international business operating in America, there’s much to consider. Here are some of the top issues based on my experience of almost thirty years practicing domestic and international law.
The Basics of Business Compliance with Country-Specific and International Law
Any business conducting trade globally is responsible not only for abiding by the laws of their own country but also the laws of any country where they do business. In addition to that, there are international laws that may apply as well. International laws govern the relationships between countries and are comprised of the following:
Treaties and international agreements
International organizations and conferences
International customs
Private agreements between the parties and applicable contract law
As such, businesses involved in international trade are generally subject to the following.
Fairtrade practices
Tariffs, import-export quotas, and licensing obligations
Human rights standards
Labor standards
Intellectual property rights
Data protection laws and standards (The EU, Canada, & Russian Federation have significant penalties for violations)
Top Considerations for Global Businesses
To minimize your risk of running afoul of any country and/or international law, as well as minimizing the impact of a dispute when conducting business globally, keep these considerations in mind.
Cultural and language barriers – Either of these can create massive misunderstandings in everything from business conversations to contracts.
Political climate – Specifically, what is the state of the relationship between the United States and the country or countries in which you do business? If tensions are high, this could impact you significantly. You should check the Office of Foreign Asset Control (“OFAC”) and the U.S. Embassy in any targeted country to determine whether there are sanctions against the country and/or parties involved and to check for state department warnings and advisories.
Economic policy – Pay attention to interest rates, the labor market, taxes on goods, and, in general, the economic stability of the country.
Consumer protections – Some countries have much more stringent privacy laws and/or data protections than we do in the United States.
Environmental standards – Depending on the type of business you’re in, how strict a country’s environmental laws can significantly impact production and cost.
Dispute resolution – If and when a dispute arises, the laws and/or customs differ by country as well. In one country, it may be standard to negotiate through arbitration first, while another may not allow arbitration, and you must go straight to litigation.
Bonus Tip: Being Proactive is Best
Try as you might to avoid them; it’s best to plan for disputes proactively. One way to do that is to consider as many what-ifs as possible and try to prepare contracts accordingly. In this, and the considerations above, you ideally want to collaborate with local counterparts in the country or countries in which you are conducting business who speak the language, know the market, know the laws, and know the customs to help you navigate any potential issues.
An International Law Attorney Can Help
Perhaps the best thing you can do for your global business is to partner with experts in international law. An attorney with this experience can advise you of your rights, what laws apply to your business, and represent you should any issues arise. They should also be well-versed in collaborating with local counterparts as well.
Attorney G. Kline Preston, IV has almost thirty years of experience practicing law in both domestic and international forums. He specializes in the following:
Facilitating networking and collaboration between U.S. and foreign-based businesses
Assisting with business formation
Lease agreements, purchase contracts, and vendor agreements
Employment contracts and employment law
Dispute resolution and litigation
For advice or detailed guidance on any intellectual property legal issue, contact G. Kline Preston!
