International Business Law

INTERNATIONAL BUSINESS LAW: CASES AND MATERIALS is a timely and useful book. Uncounted millions of “international” transactions occur daily, as goods and services are purchased across the national boundaries of some 200 political units. Capital flows from nation to nation, and so—to a lesser extent—do jobs, as companies seek more favorable locations for their business operations. The “rules” (laws) governing these exchanges quickly become complex, as persons (and governments) from different countries are involved. If problems arise in a cross-border relationship, whose rules apply? What forums are available to resolve disputes? Are there tax implications to the transaction? If so, where? These and similar questions need to be factored into the decision to “go overseas.”

Each of the six chapters in this book begins with a brief overview of the subject-matter, followed by short previews of the chosen case examples. The primary content of the chapters consists of some 120 court and arbitration decisions in real disputes, between real parties. The actual text of the decisions in these cases has been edited; some excerpts are quite brief, others are more substantial. Most “background” facts have been summarized by the author, but the edited-decision part of each case is quoted from the actual recorded text of the court or arbitrator who decided it. Clearly, a minute sample from tens of thousands of cases cannot provide comprehensive coverage of what all the world’s legal rules are. Our objectives here are simply to indicate some of the major potential “flash points” of doing international business, to illustrate some of the significant differences in the applicable legal rules, and to provide an exposure to the language and process by which international business disputes are resolved. “Fore-warned is fore-armed.” Being aware of these potential trouble spots, a sensible business manager will presumably consider them in making the decision to engage in cross-border transactions, and take appropriate steps to avoid or minimize potential adverse consequences.

Chapter I of this book introduces International Law—its course of development and its two major sources (custom and treaties). Chapter II examines the use of national and international courts and arbitrators to resolve cross-border disputes. Chapter III provides basic coverage of the United Nations Convention on Contracts for the International Sale of Goods: when it applies, how the sale contract is formed, when risk of loss on the goods passes from Seller to Buyer, and what responsibilities the Seller has for the quality of the goods sold. Chapter IV looks at some of the legal questions that might arise in conducting cross-border commercial operations—employment issues, intellectual property issues, and investment issues. Chapter V considers potential questions regarding taxation of international activities, and the regulation of adverse environmental effects. Chapter VI reviews the efforts by national governments to apply their competition regulations to international business transactions, and the difficulties that private parties might have in attempting to enforce legal claims against governments and their agencies. While these are surely not the only legal issues that might arise in connection with international business, they do constitute a significant set of concerns of which managers need to be aware as they venture into the international “stream of commerce.”

GEORGE D. CAMERON III is Emeritus Professor of Business Law at the University of Michigan’s Ross School of Business. He earned a B.A. and an M.A. at Kent State University, and a J.D. and Ph.D. (Political Science) at the University of Michigan. He taught for 53 years—the last 43 at Michigan, including teaching visits in Beijing, Helsinki, Hong Kong, and Sao Paulo. The three Business Law texts that he authored or co-authored have gone through a combined total of 17 editions. He has won a number of teaching and research awards, including students’ first (1982) “Best Professor” award at the University of Michigan’s business school, listing as a noteworthy professor by Business Week in its 1986 ranking of the Top Ten Business Schools, a State of Michigan Undergraduate Teaching Award in 1990, the Bernard Teaching Leadership Award from his business school colleagues in 2003, and the Outstanding Senior Professor Award for 2004 by the Academy of Legal Studies in Business.

International and comparative law has always been a high priority with Professor Cameron. The Business Law: Text and Cases (1982) that he co-authored was the first to include a full chapter on International Law, in addition to cases dealing with international transactions. He developed special courses for his teaching assignments at China University of Political Science and Law, and at Helsinki School of Economics and Business Administration (now the Aalto University School of Business). He co-taught a special international class in the University of Michigan’s joint program with Erasmus University (the Netherlands) for three years, and also co-taught in the U/M’s Global MBA program—teaching twice each in Hong Kong and Sao Paolo.

The UN Convention on Contracts for the International Sale of Goods (addressed in Chapter III of International Business Law: Cases and Materials) became a regular part of all the University of Michigan courses Professor Cameron taught dealing with Contract Law and Sale of Goods Law. He felt it was important for future business managers to be aware of the risks of lawsuits in other nations, so he insisted on covering “long-arm” jurisdiction (addressed in Chapter II of this book) in every course he taught—for the last 40+ years. He also developed a separate International Law course for MBAs, and teaching materials from that course became the starting point for International Business Law: Cases and Materials.