Property rights

every parcel of land, every building, every trademark, is represented in a property

document. That entitles the owner to derive income and  benefits from it

For example, property can be used as collateral for credit, which represents the single most
important source of funds for new businesses in the United States. But generally, countries
with high poverty rates have poor property rights.

Patents are legal rights awarded by government authorities to inventors of new products
or processes. Unauthorized use of patented processes or formulas is called patent
infringement. 

Copyrights are exclusive legal rights of authors and publishers to publish and disseminate
their work. The unauthorized use of copyrights is referred to as piracy.

Trademarks are exclusive legal rights of firms to use specific names, brands, and designs
to differentiate their products from others. Unauthorized use of trademarks is called
counterfeiting.

 intellectual property rights need to be asserted and enforced through a formal system
that’s designed to provide an incentive for people and firms to innovate.

Legal Differences

The two most common are civil law and common law. Civil law is derived from Roman
law and was strengthened by Napolean’s France. It uses comprehensive statutes and codes
as a primary means to form legal judgements. Relative to common law, civil law has less
flexibility because judges only have the power to apply the law. It results in much simpler,
more concise, shorter contracts

Common law is English in origin. It’s shaped by precedence and traditions, as well as
judicial interpretation. Relative to civil law, common law has more flexibility because judges
have to resolve specific disputes based on their interpretation of the law. And such
interpretation may give new meaning to the law, which will in turn shape future cases. This
results in more lengthy contracts, because they need to consider any possible situation
that might arise.

Theocratic law is based on religious teachings. In Lesson 01, we talked about Islamic law,
and that is an example of a theocratic legal system.

t’s wise to include arbitration clause to avoid litigation in the state or federal courts. And
a mediation clause could call for the parties to seek help in resolving disputes via some
kind of mutual agreement before resorting to binding arbitration or litigation.
Litigation is a term we use when we’re taking a dispute to the national court

A mediator tries to bring the parties together to come to some kind of mutual agreement
of their dispute. Informal mediation is when you simply name a third party as a mediator.
Formal mediation is done under the auspices of a Mediation Center, which do exist in
many countries. Could be in a neutral country. Mediation currently does not have legal
force in every country, so it’s recommended to also have an arbitration clause.

Mediation is a flexible and consensual technique in which a neutral facility helps the
parties reach a negotiated settlement of their dispute. The parties have control over the
decision to settle and the terms of any agreement. Settlements are contractually binding
and widely enforceable.

Now arbitration is different than mediation. In arbitration, both parties agree to be

subject to a panel or a single judge--these are not judges in the legal court system of the
country, but an independent third party body. Two common organizations are the
London court of International Arbitration and the International Chamber of Commerce as
an arbitration body

ICC Arbitration assures the best quality of service. That’s because it is delivered by a
trusted institution and a process that is recognised and respected as the benchmark for
international dispute resolution. From straightforward sales contracts to intellectual
property matters, joint ventures, share purchase arrangements or state-financed
construction projects—whatever the case—we can assist in resolving disputes of all
sizes.

1.Common law can be best described by which of the following statements?

English in origin and shaped by precedents, traditions, and from previous judicial
decisions.

1. _______ are legal rights awarded by government authorities to inventors of new

products or processes.
Patents

In international business, most firms include a ____________ clause in their contract, which
means that in the event of a dispute between the parties, they agree to subject themselves
to the decision of a previously designated judge or panel from an international organization
rather than the judicial system of either country. The parties would then follow the ruling of
the pre-determined judge or organization as binding

Arbitration
The Foreign Corrupt Practices Act prohibits payments to foreign public officials under
circumstances that might induce recipients to misuse their positions to assist the
company to obtain, maintain, or retain business.

True

The Foreign Corrupt Practices Act DOES NOT ALLOW U.S. firms to make grease payments to
public officials to perform their normal duties, even if a common practice in the country, and
even if they keep records of such payments.

False

The Index of Economic Freedom Links to an external site.from the Heritage Foundation,

measures 12 specific factors, and averages them equally into a total score. Each one of
the 12 freedoms is graded using a scale from 0 to 100, where 100 represents the
maximum freedom. A score of 100 signifies an economic environment or set of policies
that is most conducive to economic freedom. The 12 freedom components are:

 Property rights
 Judicial effectiveness
 Tax burden
 Government integrity
 Government spending
 Fiscal health
 Business freedom
 Labor freedom
 Monetary freedom
 Trade freedom
 Investment freedom
 Financial freedom

Intellectual Property Rights and Crop Protection Products

Intellectual property plays a big part in our everyday lives. It ensures that inventors get
compensated for the creative ideas and their inventions. Intellectual property protection
comes in many forms such as copyrights, patents, and trademarks. 

 Intellectual property rights play a role in making all of these benefits possible. Developing
crop protection products is a costly endeavor because of the rigorous safety and efficacy
testing that is required to register a new product.

Bringing the new agrochemical product to market takes over nine years, costs $256
million and requires more than 126 tests for safety and efficacy. In order to
encourage continued innovation, intellectual property rights must be maintained.
For crop protection products, this includes two main issues, stopping counterfeit
products and protecting regulatory data.
Counterfeit crop protection products do not undergo safety or efficacy testing, so
they present a health and safety risk for farmers and can create environmental
hazards.

Regulatory data protection is also necessary to foster confidence and stimulate

investment in research and development, making it possible to develop new crop
protection products for sustainable agriculture today and in the future.

The FCPA does not forbid payments to lesser figures, however. On the contrary, it explicitly allows
facilitating payments (“grease”) to persuade foreign officials to perform their normal duties, at both the
clerical and ministerial levels. The law establishes no monetary guidelines but requires companies to
keep reasonably detailed records that accurately and fairly reflect the transactions

The act also prohibits indirect forms of payment. Companies cannot make payments of this nature while
“knowing or having reason to know” that any portion of the funds will be transferred to a forbidden
recipient to be used for corrupt purposes as previously defined.

eflecting this awareness, most U.S. business people prefer to play by local rules, competing in the open
market according to the quality, price, and services provided by their product. Few, if any, want to make
illegal payments of any kind to anybody. Most prefer to obey both local laws and their own ethical
convictions while remaining able to do business.

Throughout non-Western cultures, three traditions form the background for discussing payoffs: the
inner circle, future favors, and the gift exchange. Though centuries old, each has evolved into a modern
business concept. Americans who work in the Third World need to learn about them so they can work
within them.