Deck 9: International Law in a Global Economy

Question 1

National law is formed as a result of international treaties, customs, and organizations.

Answer 1

False

Question 2

Dumping is the exporting of environmentally polluting goods to a foreign market

Answer 2

False

Question 3

Under the principle of comity, foreign nations are exempt from the juris?diction of U.S. courts.

Answer 3

False

Question 4

Under the principle of comity, a foreign business that deals with a U.S. business may be subject to U.S. law.

Question 5

Confiscation occurs when a government seizes private property for a proper public purpose and awards "just confiscation."

Question 6

Many countries guarantee compensation to foreign investors if their property is taken.

Question 7

The principle of comity is based primarily on international treaties.

Question 8

A party to a licensing agreement generally agrees to pay royalties.

Question 9

Restrictions on imports may include strict prohibitions.

Question 10

The Foreign Sovereign Immunities Act spells out what a "foreign state" includes.

Question 11

Restrictions on exports may include tariffs.

Question 12

Franchising is a form of licensing.

Question 13

The act of state doctrine provides that only a head of state can make trea?ties with an?other nation.

Question 14

The act of state doctrine can have important consequences for firms doing business in other countries.

Question 15

A foreign state is immune from the jurisdiction of U.S. courts unless the state is involved in commercial activity within the United States.

Question 16

Under the act of state doctrine, a firm whose assets a foreign gov?ernment has expro?priated may not recover compensatory damages in a U.S. court.

Question 17

Congress cannot impose any restrictions on exports except taxes.

Question 18

Antidumping duties are the responsibilities of international environmental polluters.

Question 19

In an exclusive distributorship, a distributor agrees to distribute only the seller's goods.

Question 20

The simplest way for a U.S. firm to do business in a foreign mar?ket is to establish manufacturing plants abroad.

Question 21

Call Center Corporation, a U.S. firm, owns property in India. The government of India seizes the property for a proper public purpose and pays Call Center just compensation. This is

A) confiscation.
B) defalcation.
C) dumping.
D) expropriation.

Question 22

Quotas are limits on the amounts of goods that can be imported.

Question 23

Foreign exchange markets comprise a worldwide system for buying and selling currency.

Question 24

The whistleblower provisions of the Sarbanes-Oxley Act of 2002 have foreign, as well as domestic, application.

Question 25

When a forum-selection clause is included in an interna?tional contract, legal proceedings are more complex and attended by more uncertainty.

Question 26

The basis for India to give effect to the laws and court decisions of the United States is primarily

A) courtesy and respect.
B) fear and intimidation.
C) admiration and envy.
D) payments of cash and exchanges of property.

Question 27

Tariffs are taxes on imports.

Question 28

There are universally accepted rules as to which court has jurisdiction over a dispute involving parties from several countries.

Question 29

A force majeure clause in an international business contract commonly stipulates "major forces" that require a party to perform.

Question 30

A foreign citizen can bring a civil suit in a U.S. court for a violation of a treaty of the United States.

Question 31

The primary aim of the North American Free Trade Agreement is to eliminate tariffs among the United States, Canada, and Mexico.

Question 32

Michael, a citizen of Ireland, and Nina, a citizen of the United States, enter into a contract. When Nina breaches the contract, Michael obtains an award of damages in an Irish court. He asks a U.S. court to enforce the award. The U.S. court defers to and enforces the Irish court's decree. This is

A) a travesty of justice.
B) the act of state doctrine.
C) the doctrine of sovereign immunity.
D) the principle of comity.

Question 33

A U.S. citizen can bring a civil suit in a U.S. court against a U.S. entity for a tort allegedly committed overseas.

Question 34

Under a letter of credit, the issuer is bound to pay the beneficiary after the beneficiary complies with the terms of the letter.

Question 35

The chief aim of the World Trade Organization and other trade agreements is to maximize trade barriers among their members.

Question 36

China enters into an international treaty with other nations. Southeast Asian Foods, Ltd., does business in countries throughout the region. The treaty governs

A) relations among China and other nations.
B) relations among Southeast Asian Foods and the citizens of China.
C) relations between Southeast Asian Foods and the government of China.
D) Southeast Asian Foods only.

Question 37

Any conspiracy that has a substantial effect on U.S. commerce is within the reach of the U.S. antitrust laws.

Question 38

U.S. laws that prohibit discrimination in employment do not apply to U.S. em?ployees working for U.S. firms located abroad.

Question 39

Yokio, Ltd., and Zeno, S.A., transact an international sale of goods. At the request of these parties, a court in Portugal resolves a dispute between them. A U.S. court will most likely honor the judgment

A) if it is consistent with U.S. laws and public policy.
B) if it is consistent with Portuguese laws and public policy.
C) if it does not benefit the U.S. to deny it.
D) under no circumstances.

Question 40

Generally, a foreign government cannot sue under U.S. anti?trust laws in U.S. courts.

Question 41

The United States taxes each barrel of imported oil at a flat rate. This is

A) an antidumping duty.
B) a dumping duty.
C) a quota.
D) a tariff.

Question 42

Significant business develops in Mexico for Natural Beauty Cosmetics, Inc., a U.S. firm. Natural Beauty appoints Ojos, Ltd., a Mexican firm, to act as Natural Beauty's marketing representative in Mexico. This is

A) a joint venture.
B) franchising.
C) indirect exporting.
D) licensing.

Question 43

Adams Manufacturing Company, a U.S. firm, signs a contract with Bolivar Corporacion, a Columbian firm, to give Bolivar the right to use Adams's production processes. This is

A) a distribution agreement.
B) a joint venture.
C) direct exporting.
D) licensing.

Question 44

Sudan seizes the assets of Triage Medical, Inc., a U.S. firm. Triage's recovery from Sudan in a U.S. court may be prevented by

A) the act of state doctrine.
B) the doctrine of sovereign immunity.
C) the Foreign Corrupt Practices Act.
D) the principle of comity.

Question 45

Optima Medico Corporation, a U.S. firm, signs a contract with Pharma Beneficial, Ltd., a Canadian firm, to give Pharma the right to sell Optima's products in Canada. This is

A) a distribution agreement.
B) establishing a foreign manufacturing facility.
C) direct exporting.
D) licensing.

Question 46

World Trading Company imports products made in South America to North America, including the United States. Restrictions on these imports may include

A) neither quotas nor tariffs.
B) quotas only.
C) quotas or tariffs.
D) tariffs only.

Question 47

The United States and other members of a certain organization agree to grant normal trade relations (NTR) status on each other with regard to im?ports and exports. This organi?zation is

A) the Convention on Contracts for the International Sale of Goods.
B) the International Export-Import Bank.
C) the United Nations.
D) the World Trade Organization.

Question 48

The government of Canada sets a limit on the amount of beef that can be imported from the United States. This is

A) a dumping duty.
B) an antidumping duty.
C) a quota.
D) a tariff.

Question 49

Bytes Business Corporation, a U.S. firm, and Comida Comercial, S.A., a Mexican firm, are parties to a contract that does not specify a choice of law. The govern?ing law is that of

A) any third country.
B) Spain.
C) the buyer's place of business.
D) the seller's place of business.

Question 50

Wang Ltd., a Chinese firm, imports its goods into the United States and offers those goods for sale at "less than fair value." This is

A) confiscation.
B) defalcation.
C) dumping.
D) expropriation.

Question 51

Senator Winters and other politicians want to limit the flow of technologically advanced products and data from the United States to other countries. To carry out this objective, Congress can

A) do nothing.
B) assess antidumping duties.
C) impose export taxes.
D) impose export restrictions on these products.

Question 52

A clause in a contract between Timber Corporation, a U.S. business, and Wang, Ltd., a Japanese business, specifies that disputes over the con?tract will be adjudicated in the United States. This is

A) a choice-of-forum clause.
B) a choice-of-law clause.
C) a force majeure clause.
D) an arbitration clause.

Question 53

Fact Pattern 9-1 (Questions 25-27 apply)
First State Bank issues a letter of credit in favor of Whirlwind Instruments Company, an American firm, to facilitate an international sales contract to buy resources from Lapland Mining, Ltd., a Finnish company.
Refer to Fact Pattern 9-1. First State Bank must pay Lapland when Lapland

A) enters into the contract with Whirlwind.
B) verifies that Whirlwind has the money to pay for the purchase.
C) complies with the terms and conditions of the letter of credit.
D) none of the choices.

Question 54

UniOil, a U.S. firm, owns property in Venezuela. When the government of Venezuela seizes the property, UniOil asks a U.S. court to order the property's return. The court rules that Venezuela is exempt from the court's jurisdiction. This is

A) a travesty of justice.
B) the act of state doctrine.
C) the doctrine of sovereign immunity.
D) the principle of comity.

Question 55

Vieux Carré S.A., a French firm, imports its goods into the United States and offers those goods for sale at "less than fair value." "Fair value" is the price of

A) comparable goods in a select "basket" of other countries.
B) Vieux Carré's goods in France.
C) Vieux Carré's goods in the United States.
D) Vieux Carré's goods on the world market.

Question 56

Mountain Mining Company, a U.S. firm, owns property in Bolivia. The government of Bolivia seizes the property for an illegal purpose without paying just compensation. This is

A) confiscation.
B) defalcation.
C) dumping.
D) expropriation.

Question 57

Innovative Manufacturing Company, a U.S. firm, signs a contract with Librador Corporacion, a Columbian firm, to give Librador the right to use Innovative's production processes. This is

A) a distribution agreement.
B) establishing a foreign manufacturing facility.
C) indirect exporting.
D) licensing.

Question 58

The United States is a party to many international agreements, including the World Trade Organization, which, among its members,

A) does not affect trade barriers.
B) maximizes trade barriers.
C) minimizes trade barriers.
D) outlaws trade barriers.

Question 59

WiFi Corporation, a U.S. firm, signs a contract with Bueno Computadores, Ltd., an Argentinean firm, for a shipment and payment for WiFi's goods. This is

A) a distribution agreement.
B) direct exporting.
C) indirect exporting.
D) licensing.

Question 60

Congresswoman Summers and other politicians want to prohibit the import of certain agricultural products that pose a danger to domestic crops. With respect to these products' import, Congress can

A) do nothing.
B) impose quotas, but not tariffs.
C) impose tariffs, but not quotas.
D) prohibit the imports.

Question 61

To obtain a contract with the Chinese government, Digby Engineering Corporation a U.S. firm, gives a Chinese official a sport utility vehicle. This may violate

A) the act of state doctrine.
B) the doctrine of sovereign immunity.
C) the Foreign Corrupt Practices Act.
D) the principle of comity.

Question 62

Fact Pattern 9-1 (Questions 25-27 apply)
First State Bank issues a letter of credit in favor of Whirlwind Instruments Company, an American firm, to facilitate an international sales contract to buy resources from Lapland Mining, Ltd., a Finnish company.
Refer to Fact Pattern 9-1. First State Bank

A) is responsible for making sure that the parties perform the contract.
B) will make payment once the transaction has been completed.
C) will make payment when Lapland presents the proper documents.
D) none of the choices.

Question 63

Fact Pattern 9-1 (Questions 25-27 apply)
First State Bank issues a letter of credit in favor of Whirlwind Instruments Company, an American firm, to facilitate an international sales contract to buy resources from Lapland Mining, Ltd., a Finnish company.
Refer to Fact Pattern 9-1. In a letter of credit, the ben?eficiary is

A) Lapland.
B) Whirlwind.
C) First State Bank.
D) none of the choices.

Question 64

Miranda is a U.S. citizen working in Europe for Tourist Vacations, Inc., a U.S. travel agency. Tourist fires Miranda for reasons that she believes vio?late U.S. antidis?crimination laws. Those laws apply

A) extraterritorially.
B) only to signatories of the North American Free Trade Agreement.
C) only to members of the World Trade Organization.
D) only within U.S. borders.

Question 65

Two Japanese firms-Mikato, Ltd., and Shuzushi, Ltd.-enter into a joint venture in an attempt to increase their market share of the U.S. auto market. If the joint venture is not a per se violation of U.S. antitrust laws, a U.S. court could exercise jurisdiction over the firms

A) if the joint venture has a substantial effect on U.S. commerce.
B) if the joint venture has any effect on U.S. commerce.
C) if the joint venture was entered into in the United States.
D) under no circumstances.

Question 66

Standard International Diversified Corporation (SIDC) owns assets in Tagistan, a nation in Asia. The government of Tagistan wants to nationalize all assets owned by foreign firms. What can SIDC do Can it at least obtain payment for the assets

Question 67

Bulbous Cordials, Inc., a U.S. firm, enters into an agreement with Columbiana Cacao, S.A., a South American firm, to fix the price of dark chocolate in the U.S. market. If the agreement is a per se violation of U.S. antitrust laws, a U.S. court could exercise jurisdiction over

A) Bulbous Cordials and Columbiana Cacao.
B) Bulbous Cordials only.
C) Columbiana Cacao only.
D) neither Bulbous Cordials nor Columbiana Cacao.

Question 68

Aung-San and other Burmese citizens allege that Railway Construction Company, a U.S. firm, collaborated with the government of Myanmar (Burma) in committing human rights violations within that country. To seek redress for their injuries in a U.S. court, these citizens can

A) "blow the whistle" under the Sarbanes-Oxley Act.
B) bring civil suits under the Alien Tort Claims Act.
C) file criminal complaints under Title VII of the Civil Rights Act.
D) do nothing.

Question 69

Football Unlimited, a British seller of tickets to overseas sports games, enters into a price fixing agreement with World Cup Sports, the exclusive U.S. vendor of Football's tickets. A U.S. court is most likely to apply U.S. antitrust laws to this agreement

A) if it has a substantial effect on U.S. commerce.
B) if it has any effect on U.S. commerce.
C) if it was entered into in the United States.
D) under no circumstances.

Question 70

Sam, or any U.S. citizen, can bring a civil suit in a U.S. court against a foreign entity for

A) a tort allegedly committed in the United States only.
B) a tort allegedly committed in the United States or overseas.
C) a tort allegedly committed overseas only.
D) no purpose.

Question 71

Fabiola, or any foreign citizen, can bring a civil suit in a U.S. court for

A) a violation of a treaty of the United States only.
B) a violation of a treaty of the United States or of the law of nations.
C) a violation of the law of nations only.
D) no purpose.

Question 72

Savory Cooking Sauces, Inc., a U.S. business firm, makes and sells distinctively flavored cooking sauces. Although the recipes are secret, the ingredients could be revealed and the sauces could be reconstructed with diligent efforts. What can Savory do to prevent its products from being "decoded" and pirated abroad