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Chapter: 11 -Problem: 3 >> A country enacts a law that denies import privileges for five years to any firm that “dumps” products for sale in its markets at less than normal value. Do the WTO antidumping agreements permit such a remedy?
Answer Preview: No. The remedy for dumping is …

, Chapter: 2 -Problem: 6 >> Internationalists often refer to the “unification” or “harmonization” of international law. What do you think these terms mean? What factors have influenced the harmonization of international business law? In what ways do you think IBL is more “national” than international?
Answer Preview: International conventions tend to harmonize national …

, Chapter: 3 -Problem: 4 >> 1. What were the court’s reasons for refusing to apply forum non-conveniens to this case and requiring refiling of the litigation in Colombia? 2. Does the court’s opinion reward forum shopping to the extent the plaintiffs were likely to receive a larger damages award in the United States than in Colombia? Why or why not? 3. The court cited concern regarding the unstable political situation in Colo
Answer Preview: 1. The plaintiffs believed that Connecticut was the proper forum for their case because defendants p…

, Chapter: 16 -Problem: 4 >> 1. How important are the following two representations made by the Requestors to the DOJ’s decision? (a) The Requestors will not give any money directly to the foreign officials but will pay expenses directly to the providers. (b) The amount spent on hotels and meals will not exceed the GSA rate (which is the maximum per diem allowance that U.S. federal employees are entitled to receive as reimbur
Answer Preview: 1. Both are important. They show the intent to not seek …

, Chapter: 3 -Problem: 6 >> 1. What was the court’s holding with respect to the enforceability of the choice of law clause? 2. What factors did the court use in its decision to uphold the choice of law provision? Juliette Shulof Furs (JSF) is a New York corporation that has been in the fur-dealing business for fifteen years. George Shulof, an officer of JSF, attended two auctions conducted by Finnish Fur Sales (FFS) in Finla
Answer Preview: 1. The court analyzed the Conditions of Sale, which expressly states that Shulof shall stand surety …

, Chapter: 16 -Problem: 1 >> 1. What is the “special character” of Law 194/93, and how is its purpose achieved? 2. How does the court justify not implicating the social order of Paraguay? The Paraguayan government enacted a law that specifically protects Paraguayan representatives of foreign companies. Among other things, the law requires a foreign company to make an extraordinarily large payment to the Paraguayan representat
Answer Preview: 1. Law 194/93 regulates the relationship between foreign manufacturers and firms and their rep…

, Chapter: 11 -Problem: 7 >> What makes an import practice “unfair”? What remedies are available under U.S. law to protect domestic industries from unfair import competition?
Answer Preview: International trade law distinguishes fair from unfair practices, and this d…

, Chapter: 3 -Problem: 8 >> In 1995, Jorge Luis Machuca Gonzalez purchased a Chrysler LHS in Mexico. In May 1996, Gonzalez’s wife was involved in a collision with another moving vehicle while driving the Chrysler LHS in Mexico. The accident triggered the passenger-side air bag. The force of the air bag’s deployment instantaneously killed Gonzalez’s three-year-old son, Pablo. Gonzalez brought suit in Texas district court agai
Answer Preview: The court of appeals affirmed the district court's dismissal of the case on the ground of forum non …

, Chapter: 1 -Problem: 2 >> How does international business differ from the domestic business? Explain how those differences affect the risk of doing business internationally. What factors influence that risk?
Answer Preview: Distance and differences in time, language, currency, culture, religion and political and legal syst…

, Chapter: 3 -Problem: 9 >> Badbusinessbureau.com was a limited liability company organized and existing under the laws of St. Kitts/Nevis, West Indies. Badbusinessbureau owned and operated “The Rip-Off Report,” a Website displaying consumer complaints about various businesses, including 30 or 40 complaints about Hy Cite Corporation, a Wisconsin-based marketer of dinnerware, glassware, and cookware. Badbusinessbureau did not
Answer Preview: The district court dismissed Hy Cites complaint for lack of personal jurisdiction. The court held t…

, Chapter: 7 -Problem: 5 >> The seller of goods has a right to proceed judicially against an issuing bank that dishonors its obligation under an irrevocable letter of credit, just as the seller has the right to proceed directly against the buyer. Should the issuing bank also be liable for consequential damages that are reasonably foreseeable?
Answer Preview: If damages are in co…

, Chapter: 2 -Problem: 11 >> Describe the five theories of international criminal jurisdiction. How have these been made applicable to international terrorism? What types of crimes are covered under the principle of universality? From an international law perspective, do you think that terrorism should be a universal crime? Why or why not?
Answer Preview: Territoriality refers to jurisdiction over all persons, places and property within the territory, ai…

, Chapter: 8 -Problem: 4 >> The Trade Expansion Act of 1962 as amended by the Trade Act of 1974 states that if the secretary of the treasury finds that an “article is being imported into the United States in such quantities or under such circumstances as to threaten to impair the national security,” the president is authorized to “take such action . . . as he deems necessary to adjust the imports of the article . . . so that
Answer Preview: Yes. The language grants the pre…

, Chapter: 20 -Problem: 1 >> Your employer, Ortiz-Hartman Steel Limited, is a specialty U.S. steel manufacturer. Over the past several years, OrtizHartman has been underpriced in its specialty steel submarket by a manufacturer from the Bishopric of Saul, a nation that has virtually no environmental laws. Steel plants in Saul spew pollutants into the air and the rivers. Some of the pollutants damage the property and health of
Answer Preview: With regard to the former, legal liabilities, there are domestic and international concerns. In term…

, Chapter: 12 -Problem: 6 >> You intend to obtain a saw blade produced in England and then ship it to China to be assembled with a handle that is manufactured in China. The finished saw is then packaged in China for export. What is the country of origin of the saw? Why?
Answer Preview: You should apply the substantial transformation rule se…

, Chapter: 11 -Problem: 4 >> Why does the U.S. Congress subsidize agriculture? What is the economic impact of subsidies on worldwide agricultural prices? Why are subsidies a subject of dispute between the United States, Europe, and the developing countries?
Answer Preview: Agricultural subsidies are used to protect vital land resources but also for political purpo…

, Chapter: 2 -Problem: 9 >> Why must corporations be concerned about human rights issues when doing business internationally? Who are the “stakeholders” of a public corporation, and what is management’s responsibility to them? Stakeholders A person, group or organization that has interest or concern in an organization. Stakeholders can affect or be affected by the organization's actions, objectives a
Answer Preview: Corporations are accountable to all of their stakeholders, inclu…

, Chapter: 12 -Problem: 6 >> 1. When a court reviews a classification ruling, is the court free to disregard the position of Customs and consider all the evidence anew? Must the court give complete deference to Customs’ rulings? What does the court say is the correct standard of review? 2. What was the rationale the Supreme Court used in holding for Mead? Mead had been importing “day planners” held together by a loose-leaf ri
Answer Preview: 1. Courts must give considerable weight to Customs judgments. This considerable weight is …

, Chapter: 4 -Problem: 1 >> 1. What were the court’s holdings with respect to place of business, choice of applicable law and preemption of state contract law? 2. On what basis did the court conclude that the parties had not sufficiently evidenced an intent to opt out of the CISG? What language would you have included in the purchase and confirmation orders to clearly evidence such an intent? 3. What reasons did the court gi
Answer Preview: 1. The court was not persuaded that Unique Technologies was an agent of PMC, holding that a distribu…

, Chapter: 7 -Problem: 3 >> 1. What basic principle of letter of credit law does this decision challenge? 2. How would the result be different if the draft and documents had been sold and negotiated to a holder in due course who took with no knowledge of the fraud, and who then presented the documents to the issuing bank for payment? 3. Explain the misrepresentation that took place in this case. How was this “fraud in the tr
Answer Preview: 1. The independence principle. Under traditional letter of credit law (and custom) the letter of cre…

, Chapter: 10 -Problem: 4 >> Assume the United States and Japan are unable to resolve a trade war over trade in automobiles and auto parts. Acting unilaterally, the United States imposes punishingly high tariffs of 100 percent on Japanese cars. What are the real economic impacts and long-term effects of trade sanctions? Immediate costs might be borne by the Japanese manufacturers, U.S. dealerships, or consumers, but what does
Answer Preview: In the car industry, voluntary quotas were provided for U S. car comp…

, Chapter: 1 -Problem: 8 >> 1. What was the ostensible purpose of the Italian law? What was its effect? 2. Why was the law not found to be discriminatory? 3. Assume that a municipality in a foreign country passes a law limiting the size of retail stores in the city. How might this affect U.S. firms wanting to open stores there?Italian law prohibits the opening of certain retail stores without first obtaining a license from t
Answer Preview: 1. The espoused purpose of the law was to protect consumers, achi…

, Chapter: 18 -Problem: 4 >> 1. Would the Nelsons have had a claim in U.S. courts if the employment contract Mr. Nelson had signed in the United States had expressly agreed not to detain him in the absence of criminal activity? Would such a clause have made his action one for breach of contract? Would that have made a difference? 2. If his Saudi employer had failed to pay him the amounts he had contracted to pay, would Mr. Ne
Answer Preview: 1. Possibly. In the absence of a statutory definition, the court read "based upon" to denote conduct …

, Chapter: 8 -Problem: 2 >> Together, North Carolina, South Carolina, and Georgia produce a large amount of cotton each year. In an effort to protect their farmers from overseas competition, the governors of these three states met and agreed on a uniform “inspection fee” to be imposed on all foreign cotton coming into their states through their ports. They vowed to do their best to get their state legislatures to adopt this
Answer Preview: Because these states are attempting …

, Chapter: 13 -Problem: 1 >> Beginning in 1995, both Presidents Clinton and Bush issued several executive orders under IEEPA declaring a national emergency in dealing with terrorism. The Department of the Treasury issued regulations prohibiting transactions with terrorist groups or providing services to them. Al Qaeda was named as a terrorist organization, along with the Taliban government of Afghanistan that supported them.
Answer Preview: The International Emergency Economic Powers Act (IEEPA) clearly covers transactions in foreign excha…

, Chapter: 21 -Problem: 3 >> In Alcoa, Judge Hand points out that even agreements to restrict trade only in Europe and South America would have anticompetitive repercussions in the United States. What additional element did he require before giving U.S. antitrust law extraterritorial effect?
Answer Preview: Judge Hand required that it be th…

, Chapter: 4 -Problem: 3 >> Rotorex, a New York corporation, agreed to sell air compressors to Delchi, an Italian company. The compressors were for use in producing Ariele air conditioners. The first shipment reached Delchi, and Delchi paid $188,000. In preparation, Delchi had spent 39 million lire for special tooling, and 27 million lire for special insulation and tubing for use in making Arieles. Delchi expended 18 million
Answer Preview: Delchi was permitted to recover for its attempts to remedy the nonconfo…

, Chapter: 5 -Problem: 7 >> Allied Chemical, a U.S. exporter, shipped chemicals to Banylsa in Brazil under bills of lading showing that the goods were consigned to the order of Banylsa. Allied sent the bill of lading, draft, and invoice to a Brazilian bank for collection, together with a letter of instruction to deliver the documents only on payment of the sight drafts. In the meantime, the goods had arrived in Brazil and we
Answer Preview: The appellate court affirmed the district courts judgment in favor of the shipper. …

, Chapter: 3 -Problem: 2 >> Sarl Louis Feraud International is a French corporation that designs high-fashion clothing and other items for women. Viewfinder, Inc., a Delaware corporation, operated a Website called “firstView. com,” on which it posted photographs of fashion shows held by designers around the world, including photographs of Feraud’s fashion shows. The firstView Website contained both photographs of the current
Answer Preview: The U S. Court of Appeals for the Second Circuit vacated the district courts judgment and remanded t…

, Chapter: 11 -Problem: 1 >> In an anti-dumping investigation, the ITA finds that the dumping firm was experiencing a downturn in its domestic economic cycle and that there had been no intent to harm a U.S. industry. Can antidumping duties still be applied?
Answer Preview: Antidumping duties can only be applied when there is a threat to cause …

, Chapter: 16 -Problem: 1 >> Your firm, Flyboy, Inc., is a successful U.S. manufacturer of aircraft. Flyboy would like to expand its market to Pamonia, a small, oil-rich kingdom that was once an Italian colony. The principal purchaser of aircraft in Pamonia is the government, although some private families have the resources to purchase the product. The same private families are, not coincidentally, also the nobility of the P
Answer Preview: Entering a new foreign market is often made easier by hiring a products distributor o…

, Chapter: 7 -Problem: 2 >> The buyer, a Peruvian company, entered into a contract to purchase glass fibers from an English seller. Payment was to be made under an irrevocable letter of credit confirmed by Royal Bank of Canada. The letter of credit called for a bill of lading dated no later than December 15, 1976. The goods were in fact loaded onto the vessel on December 16, but the loading brokers wrongfully issued a bill o
Answer Preview: Smith/Smitth or McDonald/MacDonald, the same …

, Chapter: 5 -Problem: 5 >> 1. If the contract stated that it was governed by the laws of Germany, why did the court apply the law of the CISG?Shared Imaging, an American company, agreed to purchase an MRI machine from Neuromed, a German seller. The one-page contract of sale stated that the delivery terms were “CIF New York Seaport, the buyer will arrange and pay for customs clearance as well as transport to Calumet City.” I
Answer Preview: The CISG governs the transaction because: (i) both Germany …

, Chapter: 10 -Problem: 1 >> In 2002, the U.S. Congress passed a law requiring the Department of Agriculture to develop country of origin label (“COOL”) requirements for fresh meats, fish, fruits, and vegetables sold to American consumers. It was a time of public concern over“mad cow” disease that had been found in some foreign cattle, and there were calls from consumer groups and many in government demanding that consumers b
Answer Preview: The WTO Appellate Body agreed with some of the panels recommen…

, Chapter: 20 -Problem: 5 >> Despite the Montreal Protocol, the nation of Livy continues to produce CFC-emitting refrigerators and to export them to nations throughout the world. A number of governments object to Livy’s practices and ban its exports pursuant to the protocol. Livy brings an action under GATT, alleging that under the principles stated in the Shrimp case, this is an attempt to impose conservationist policies on
Answer Preview: Assume that Livy, a GATT member, is not also a signatory to the Montreal Protocol, or has renounced …

, Chapter: 12 -Problem: 4 >> 1. What purposes do FTZs serve? Why did Congress establish them? 2. What were the advantages to Nissan by assembling automobiles in an FTZ? How many can you list? 3. Why could Nissan not bring manufacturing equipment into its zone duty-free? Do you think this case applies to office chairs or personal computers? Explain. 4. Assume that you import merchandise subject to annual quotas. You have a shi
Answer Preview: 1. They facilitate the use of U S. ports and to encourage re-exports of foreign products that have …

, Chapter: 3 -Problem: 3 >> Two teenagers residing in North Carolina were fatally injured when the bus upon which they were riding overturned on a roadway outside of Paris, France. The parents of the decedents brought a lawsuit in North Carolina state court against Goodyear Tire and Rubber Company and its subsidiaries based in Luxembourg, Turkey and France alleging that the accident was caused by negligent design and product
Answer Preview: No. The subsidiaries of Goodyear …

, Chapter: 21 -Problem: 7 >> U.S. antitrust law reflects U.S. economic policy. If U.S. antitrust law resolves an economic dispute among British companies, has U.S. economic policy been extended to Britain? What are the implications of the United Kingdom’s requirement that British companies comply with U.K. policy in resolving such disputes?
Answer Preview: It is true that if two U K. companies are ruled by American law in commerce directly affectin…

, Chapter: 19 -Problem: 3 >> 1. Why did the EEOC file a complaint against NCGA for a position Reyes-Gaona was applying for in Mexico? 2. Could American firms avoid the ADEA by conducting the hiring process in Mexico? 3. What was the court’s reasoning to deny the EEOC complaint? How did legal presumptions factor into its decision?Plaintiff Luis Reyes-Gaona was a Mexican national over the age of 40. Defendant North Carolina Gro
Answer Preview: 1. The EEOC argued the ADEA applied because Reyes-Gaona was applying for an employment posit…

, Chapter: 4 -Problem: 5 >> A German seller sued a Russian buyer because the buyer failed to pay for the equipment supplied to the buyer pursuant to their contract. The buyer acknowledged it had received the goods but said its nonpayment should be excused because it was due to the failure of the bank responsible for the buyer’s foreign currency transactions to make payment to the seller. The buyer claimed the bank’s lack of
Answer Preview: No. The contract between the parties included an exh…

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6 Reviews for International Business Law and Its Environment Textbook Questions And Answers