Deck 8: International Law

Question 1

The United States and Singapore have signed the Convention on Contracts for the International Sale of Goods (CISG).Notren,Inc.,a U.S.company,and SWT,a Singapore company,have entered into a contract under which SWT is to ship party supplies to Notren.One of the terms of the contract states,"The validity and performance of this contract will be governed by the Uniform Commercial Code (UCC)of the state of New York,not the Convention of the International Sale of Goods (CISG)." The contract will be governed by the:

A)CISG.
B)Uniform Commercial Code of New York.
C)common law.
D)World Trade Law.

Answer 1

B

Question 2

Multinational enterprises are companies doing business in several countries simultaneously.

Answer 2

True

Question 3

The Presidents of Oxtron,Inc.,a U.S.company,and Korgen,AG,a Swiss company,met in Beijing,China,during an international trade show.Oxtron and Korgen are direct competitors in over-the-counter medicines.The presidents agree to fix prices on their major products.This agreement does not violate U.S.antitrust law since the agreement was made in China.

Answer 3

False

Question 4

The two principal requirements of the Foreign Corrupt Practices Act involve bribes and record keeping.

Question 5

The European Union is the world's most powerful regional association with 27 member nations as of 2010.

Question 6

The United States and Argentina have signed the Convention on Contracts for the International Sale of Goods (CISG).Oxtron,Inc.,a U.S.company,and Leer,an Argentinean company,have entered into a contract under which Oxtron is to ship medical devices to Leer.The contract does not include a choice of law provision.The contract will be governed by:

A)the CISG.
B)the UCC.
C)the domestic contract law of Argentina.
D)the domestic contract law of the United States.

Question 7

Benton Corporation imports European made goods from Fouchard SA into the United States.Who is required to pay the duty on the imported goods?

A)The importer, Benton Corporation.
B)The exporter of the goods, Fouchard SA.
C)Each party pays one-half of the duty.
D)No one as the US and the EU signed a free trade agreement.

Question 8

Oxtron,Inc.,a U.S.company,and Leer,an Argentinean company,orally agreed to a contract under which Oxtron is to ship medical devices to Leer.The contract is governed by the CISG.Which statement is correct?

A)The contract is not enforceable because it is oral.
B)Whether the contract is enforceable without a written agreement depends on the value of the medical devices.
C)Whether the contract is enforceable without a written agreement depends on whether the medical devices are a necessity.
D)The contract is enforceable without a written agreement.

Question 9

It is a violation of United States law for a domestic company to pay money to a foreign governmental official in order to obtain favorable influence of the foreign government.

Question 10

Tariffs are generally higher in developing countries than in developed countries.

Question 11

Generally,consumers are not adversely affected by tariffs since tariffs affect wholesale prices,not retail prices.

Question 12

Which of the following is considered a nontariff barrier?

A)a dumping duty.
B)a quota.
C)a countervailing duty.
D)all of the above

Question 13

As of 2007,the top 2 countries which traded goods with the United States were China and Japan.

Question 14

Under European Union law,any agreement,contract,or discussion that distorts competition within European Union countries is illegal.

Question 15

A contract involving the sale of goods from a Texas seller to a French wholesaler is necessarily governed by the United Nations Convention on Contracts for the International Sale of Goods (CISG).

Question 16

International comity holds that the courts of one nation lack the jurisdiction to hear suits against foreign governments.

Question 17

Trein,Inc.,a U.S.company entered into an exclusive distributorship agreement with Posty,Inc.,a Zambian company.This means that Trein will only use Posty to distribute products in Zambia.

Question 18

Ad valorem duty is based on the price actually paid for the good when sold for export to the United States.

Question 19

Although the United States government officially signed the GATT treaty,the United States Congress has refused to ratify the agreement.

Question 20

If the United States sets a limit on the number of cars that can be imported,this action is a form of tariff.

Question 21

Jones Oil,a small United States oil company,started doing business in a foreign country.The foreign country later decided to take over the oil industry,including Jones Oil's operation.The foreign country paid Jones adequate compensation in United States dollars.The foreign country's action is called:

A)confiscation.
B)repatriation.
C)expropriation.
D)retribution.

Question 22

Which of the following statements about the GATT treaty is correct:

A)Its purpose is to eliminate trade barriers among signatory countries.
B)The US Congress has not ratified it yet.
C)The treaty has been signed by 75 countries.
D)All of the above are correct.

Question 23

With respect to United States patents and copyrights,GATT:

A)expressly excludes controversies involving patent and copyright violations.
B)will allow the United States to assess tariffs against a country that refuses to honor U.S.copyrights or patents.
C)imposes sanctions against any country refusing to honor another signatory country's patents or copyrights.
D)requires retribution to be paid to the United States by any country ignoring U.S.patents or copyrights.

Question 24

Hardhat Machine Company sold goods to Irish Eyes Company of Northern Ireland.Big Bank issued a letter of credit on behalf of Irish Eyes and the letter was given to Hardhat.The "account party" is:

A)Irish Eyes.
B)Hardhat Machine Company.
C)Big Bank.
D)None of the above.

Question 25

Larson Cashmere Company invests a large sum of money in retail stores located in a foreign country.Larson intends to bring its foreign earnings back home to the United States.This practice is known as:

A)repatriation of profits.
B)inflow profit streaming.
C)expropriation.
D)return of earnings.

Question 26

Lindell,Inc.,a U.S.company,and Halden,AG,a German company,entered into a contract under which Halden is to ship party supplies to Lindell.One of the terms of the contract states,"Any disputes that arise under this contract will be resolved in the courts of Germany." This contract term is:

A)a forum selection clause.
B)a choice of law clause.
C)an arbitration clause.
D)not enforceable.

Question 27

As of 2007 figures,the country trading the most goods with the United States was:

A)Canada.
B)China.
C)Japan.
D)Mexico.

Question 28

Zebra Toy Company,located in Chicago,sells $500,000 worth of toys to a London,England,wholesaler.This contract could be governed by:

A)Illinois's Uniform Commercial Code.
B)English law.
C)the CISG.
D)All the above are correct.

Question 29

Kjell is the vice president of international sales for Oxtren,Inc,a U.S.company.To secure a multimillion dollar contract for his company,Kjell paid a Mongolian governmental officer $10,000.Kjell:

A)has violated the Foreign Corrupt Practices Act.
B)has not violated the Foreign Corrupt Practice Act because the payment was a grease payment.
C)has not violated the Foreign Corrupt Practices Act because the government official was from Mongolia, not the United States.
D)has not done anything illegal because Congress has not ratified the Convention of Combatting Bribery of Foreign Public Officials in International Transactions.

Question 30

In Avenues In Leather,Inc.v.United States,the federal appellate court ruled that the Calcu-Folio was,for tariff classification purposes,a binder and not a briefcase.The classification of goods is significant because:

A)the fair value will vary depending on the classification.
B)the tariffs will vary depending on the classification.
C)the subsidy will vary depending on the classification.
D)the dumping duty will vary depending on the classification.

Question 31

The European Union used to be known as the:

A)European Trade Zone.
B)Common Market.
C)European Economic Area.
D)Euro.

Question 32

The Marcel Company is opening an office in Mexico.The cost to obtain electrical service is $500,but the clerk suggests that service could be started faster if an additional $50 is paid,which the clerk will keep.If the Marcel official pays the additional $50:

A)he will have violated the Foreign Corrupt Practices Act.
B)he will not have violated the Foreign Corrupt Practices Act because this would be considered a "grease" or facilitating payment, which is legal.
C)he will be guilty of violating the Foreign Corrupt Practices Act only if the payment was illegal under the written law of Mexico.
D)he will be guilty of violating both the Foreign Corrupt Practices Act and the Convention of Combatting Bribery of Foreign Public Officials in International Business Transactions.

Question 33

The Austrian government has opened a tourist information center in New York City.If a dispute arises over the lease of the storefront,may the landlord sue the Austrian government in the United States courts?

A)Yes, because the Austrian government was engaged in a commercial activity.
B)No, because of the Foreign Sovereign Immunities Act which forbids U.S.courts from hearing any cases involving foreign governments.
C)Yes, if the Austrian government signed a written waiver giving up its immunity.
D)Yes, as the Austrian government is a signatory on the CISG.

Question 34

Archer Co.has decided it wants to expand into international business,but it is concerned about expropriation of its property or losses caused by political unrest.Archer is considering purchasing insurance through the Overseas Private Investment Corporation (OPIC).OPIC:

A)provides insurance, but the cost is relatively high.
B)provides insurance, but the list of countries in which it is willing to provide such protection is fairly short.
C)has had remarkable success at no cost to the U.S.government.
D)insures against expropriation, but not against losses stemming from political violence.

Question 35

Hardhat Machine Company sold goods to Irish Eyes Company of Northern Ireland.Big Bank issued a letter of credit on behalf of Irish Eyes and the letter was given to Hardhat.The documents required by the letter of credit are presented to the bank for payment while the goods are still in transit.Is Hardhat entitled to be paid?

A)No, payment is not due until the goods are delivered.
B)No, payment is not due until 30 days after delivery.
C)No, payment is not due until the buyer has had a reasonable time to inspect the goods.
D)Yes, the letter of credit is a promise by the bank to pay when certain documents are presented.

Question 36

If a foreign company "dumps" goods on the United States market:

A)the goods will be considered illegal goods and not be allowed to be sold in the United States.
B)the United States will issue trade sanctions against the country that allowed the dumping.
C)a "dumping duty" will be imposed on the dumped goods if the Commerce Department determines the goods are being sold at less than fair value and that this harms an American industry.
D)All the above are correct.

Question 37

The primary antitrust law in the United States is the:

A)Wagner Act.
B)Sherman Act.
C)SEC Act of 1933.
D)Robinson-Patman Act.

Question 38

The United States has agreed to which of the following?

A)GATT.
B)NAFTA.
C)CISG.
D)All of the above.

Question 39

What is a major difference between a United States lawsuit versus a French lawsuit?

A)In a French civil lawsuit, there is no right to a jury trial.
B)Unlike the US, the French legal system engages in extensive discovery procedures.
C)In a French lawsuit, the rules of evidence are less flexible.
D)All of the above are correct.

Question 40

The primary goal of the North American Free Trade Agreement (NAFTA)is to:

A)allow Canada, the United States, and Mexico to compete as a common economic entity against other countries in the world.
B)allow for the free and unrestricted movement of people from one country to another to improve the labor market of all three counties.
C)eliminate almost all trade barriers between the three nations.
D)All the above are correct.

Question 41

MagNet is a U.S.company based in Utah.It is negotiating to sell $4 million worth of computer goods to a French company,Lassart.Lassart is insisting that the contract be governed by the CISG.What is the requirement for the CISG to apply and what are some of the primary differences between the UCC and the CISG?

Question 42

MicroWare is a U.S.company based in Utah.It is negotiating to sell $4 million worth of computer goods to a French company,Baranger.MicroWare's attorney suggests that payment be by a letter of credit.What is a letter of credit and why does MicroWare's attorney recommend payment by letter of credit?

Question 43

Identify the term for and discuss the legality of a government's taking of property owned by foreign investors.Discuss what action a company might take if it wants to do business abroad but is concerned about losing its property to a foreign government.

Question 44

Laney,Inc.is interested in expanding its business overseas by licensing its intellectual property rights to a German company.Discuss the precautions to take and risks to be aware of before making the decision to enter into a licensing agreement.

Question 45

Explain what the General Agreement on Tariffs and Trade (GATT)is and give pro and con arguments concerning this agreement.

Question 46

Explain the origin and purpose of the World Trade Organization.