Chapter 52 International and Comparative Law

1. Chapter 52International and Comparative Law

2. Introduction • International Law. • Body of law - formed as a result of international customs, treaties, and organizations - that governs relations among or between nations. • National Law. • Law of a particular nation.

3. The Nature and Sources of International Law • The sources of international law are: • International Customs. • Treaties and International Agreements. • International Organizations and Conferences.

4. § 1: International Law • International law is the result of attempts to reconcile the need of each country to be the final authority over its own affairs and the desire to benefit from relations with one another.

5. Sources of International Law • Three Sources of International Law: • International Customs. • Treaties and International Agreements. • International Organizations.

6. Legal Principles and Doctrines • The most important principles and doctrines applied in the interest of maintaining harmonious relations among nations: • The Principle of Comity. • The Act of State Doctrine. • The Doctrine of Sovereign Immunity.

7. The Principle of Comity • One nation will defer and give effect to the laws and judicial decrees of another country, as long as those laws and judicial decrees are consistent with the law and public policy of the accommodating nation.

8. The Act of State Doctrine • Judicial branch of one country will not examine the validity of public acts committed by recognized foreign government within its own territory. • This doctrine is often invoked to protect: • Expropriation, and • Confiscation.

9. The Doctrine of Sovereign Immunity • This doctrine exempts foreign nations from jurisdiction in U.S. courts. • The Foreign Sovereign Immunities Act expanded the jurisdiction of U.S. courts for creditors of foreign governments.

10. § 2: Doing Business Internationally • Types of International Business Operations • Exporting, through: • An Agent. • A Foreign Distributor. • Manufacturing Abroad, through: • Licensing. • Franchising. • Investing in a subsidiary or joint venture.

11. The Regulation of Specific Business Activities • Nations impose laws and controls to restrict or facilitate international business. • Investing. • Export and Import Controls: Quotas, Tariffs • International Organizations and Agreements: World Trade Organization, European Union and NAFTA.

12. The Applicability of U.S. Law Abroad • U.S. antitrust law applies to the activities of U.S. firms even when they are acting abroad. • Foreign persons and governments can sue under U.S. antitrust laws in U.S. courts. • Generally, U.S. firms must abide by U.S. anti-discrimination law, even in their foreign activities, unless doing so would require them to violate the laws of the foreign country.

13. Dispute Settlement in the International Content • The options for resolution of international contract disputes are the same as they are for civil disputes: • Arbitration or Litigation.

14. § 3: Comparative Law • Comparative Legal Systems • Common Law: courts independently interpret and create rules and legal traditions. Followed in England, U.S. and a few other countries. • Civil Law: Only source of law is the codified law (statutory code). Following by the majority of the world’s developed nations, including European Union, Japan and Mexico.

15. National Laws Compared • Virtually all nations have laws governing contracts, sales, torts and property rights. • Tort Laws compared: • Failures to Act. • Damages. • Contract Law: • CISG, Agreement & Consideration; • Remedies; and • Defenses.

16. National Laws Compared [2] • Employment Law: • At-Will Doctrine. • Wages and Benefits. • Working Conditions. • Equal Employment Opportunity. • Termination. • Cultural and Business Traditions.

17. Focus on Ethics • Free Speech and the Corporation. • Ethics and the Administrative Process. • Ethics and International Law. • Intellectual Property Rights. • Sovereign Immunity. • Foreign Corrupt Practices Act.

18. Case 52.1: U.S. v. Haggar Apparel(Import Control) • FACTS: • Haggar Apparel Company buys fabric in the United States and ships it to Mexico to make pants. • The trousers are sewn, permapressed, and shipped back to the United States. Under federal law, U.S. goods assembled abroad and reshipped to the United States are exempt from a duty that is charged against other incoming goods. • The U.S. Customs Service levied a duty on Haggar’s pants, however, under a regulation that deems all permapressing operations to be an additional step in manufacture, not assembly. Haggar sued.

19. Case 52.1: U.S. v. Haggar Apparel(Import Control) • HELD: FOR GOVERNMENT. • Congress authorized the U.S. Treasury Department and the Customs Service to administer the tariff regulations, which were the product of notice-and-comment rulemaking. • The Court held that without language to the contrary in the enabling statutes or the regulations, the tariff classifications were entitled to “judicial deference.”

20. Case 52.2: Garware Polyester v. Intermax Trading Co.(Choice of Forum) • FACTS: • Garware, based in India, develops and makes plastics and high-tech polyester film. • In 1987, Intermax of New York became Garware’s North American sales agent. • Over the next decade, the parties executed four written agreements, collectively referred to as the “Agency Agreements.” Each agreement provided, ”The courts at Bombay [India] alone will have jurisdiction ….” • Intermax sued Garware, who fell behind in payments, in U.S. federal court.

21. Case 52.2: Garware Polyester v. Intermax Trading Co.(Choice of Forum) • HELD: CASE DISMISSED FOR IMPROPER VENUE. • The court held that each of the Agency Agreements contained a valid and enforceable forum-selection clause, which applied to this suit. • The court recognized that forum-selection clauses “eliminate uncertainty in international commerce and insure that the parties are not unexpectedly subjected to hostile forums and laws. • The court stated that a forum-selection clause applies when “claims grow out of the contractual relationship, or if the gist of those claims is a breach of that relationship.”

22. Case 52.3: Universe Sales v. Silver Castle(Comparative Law) • FACTS: • USSCo paid royalties on certain products to Offshore Sportswear (Silver Castle). • Later, Universe claimed Sportswear did not own the trademarks on the products under Japanese law (which applied here). Universe sued to recover the royalties. • At trial, Sportswear’s Japanese trademark attorney,testified that under Japanese law Universe owed royalties under Japanese law regardless of the trademark’s ownership at the time the license agreement was executed. • The court issued a summary judgment for Universe. Sportswear appealed.

23. Case 52.3: Universe Sales v. Silver Castle(Comparative Law) • HELD: REVERSED, FOR SPORTSWEAR. • The court pointed out that Universe “introduced nothing” in opposition to the attorney’s testimony. • Under Federal Rule of Civil Procedure 44.1, a court, “in determining foreign law, may consider any relevant material or source, including testimony.” • Because the attorney’s testimony “stands as an unrebutted presentation and interpretation of Japanese law, the district court erred in granting summary judgment to Universe.”