Question 1

A common law system uses a strict and literal interpretation of the law

Accepted Answer

A common law system relies heavily on judicial precedent and the interpretation of previous court decisions. Judges may use a more flexible interpretation of the law to adapt to changing circumstances and new legal issues.

Question 2

Common law is based on tradition, past practices and rulings, and legal precedent

Accepted Answer

Common law is a legal system based on tradition, past practices and rulings, and legal precedent set by courts through their decisions in cases.

Question 3

The United States is a code law country

Accepted Answer

The United States primarily follows a common law system, which is based on judicial decisions and precedent, rather than a code law system, which is based on comprehensive statutes and legal codes.

Question 4

Countries are bound by the international law which prescribes acceptable and legal behavior of international business enterprises

Accepted Answer

The answer of Countries are bound by the international law...

Question 5

The Calvo Doctrine encourages international arbitration

Accepted Answer

The Calvo Doctrine asserts that foreign investors should not seek diplomatic intervention or international arbitration for disputes, but rather should submit to the jurisdiction and laws of the country in which the investment is made.

Question 6

According to the extraterritorial-application-of-the-law concept, nations cannot apply their laws to companies' business activities outside their borders

Accepted Answer

The extraterritorial application of the law concept allows nations to apply their laws to companies' business activities outside their borders under certain circumstances, such as when the activity has a significant impact on the country's national interests or when it violates international law.

Question 7

The extraterritorial application of the law involves a nation applying its laws to activities outside its own territory

Accepted Answer

The extraterritorial application of the law is when a nation applies its laws to activities outside its own territory. This can occur with certain types of laws, such as anti-corruption laws, sanctions laws, and export control laws. It can have significant implications for multinational corporations and individuals engaged in international business.

Question 8

The Civil Rights Act barring employment bias protects U.Scitizens working abroad for American firms

Accepted Answer

The Civil Rights Act only applies to employment within the United States. It does not protect U.S. citizens working abroad for American firms.

Question 9

If a company wants to limit its potential liability which may derive from its foreign operations, it should form a foreign subsidiary rather than a foreign branch

Accepted Answer

By forming a foreign subsidiary, the parent company can limit its liability to the assets of the subsidiary, whereas a foreign branch is considered an extension of the parent company and all of its liabilities are attributed to the parent company.

Question 10

Unlike litigation, arbitration saves time, expenses, and relationships

Accepted Answer

Arbitration avoids the lengthy and expensive court process and allows parties to preserve their business or personal relationships by resolving disputes outside of a formal legal setting.

Question 11

Based on the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the New York Convention), arbitral awards rendered in one country is not recognized and enforceable in other signatory countries

Accepted Answer

The statement is false. The New York Convention provides for the recognition and enforcement of arbitral awards in any of the signatory countries.

Question 12

Since bribery is an absolute, it is easy to determine whether something is a bribe

Accepted Answer

Determining whether something is a bribe can be complex due to cultural differences, legal definitions, and the context in which an exchange occurs, making it not always straightforward.

Question 13

Bribery is a matter of degree rather than an absolute

Accepted Answer

Bribery can take various forms and can occur in varying degrees, ranging from small favors to large sums of money. Therefore, it is a matter of degree rather than a strict, absolute definition.

Question 14

The U.Sgovernment takes the position that payments made to low- and middle-level officials for tasks routinely performed by them are not illegal

Accepted Answer

The U.S. government takes the position that payments made to low- and middle-level officials for tasks routinely performed by them are not illegal.

Question 15

The trade act does not consider a payment for a routine governmental action to be an illegal bribe

Accepted Answer

The Trade Act of 1974 specifically exempts payments for routine governmental actions from being considered illegal bribes. However, it's important to note that this exemption only applies to certain types of payments and that bribery laws can vary between countries.

Question 16

The Foreign Corrupt Practices Act does not allow U.Sfirms to make expediting payments for routine government action

Accepted Answer

The Foreign Corrupt Practices Act (FCPA) does allow for certain minor payments to foreign officials for the purpose of expediting or securing routine governmental actions, often referred to as "facilitating" or "expediting payments." These are exceptions to the general prohibition against bribing foreign officials.

Question 17

OECD countries have adopted anti-bribery codes

Accepted Answer

OECD countries have adopted anti-bribery codes through the OECD Anti-Bribery Convention, which was signed by member countries in 1997. The convention requires member countries to criminalize bribery of foreign public officials and implement measures to prevent and detect such bribery.

Question 18

The OECD Anti-Bribery Convention has not been ratified

Accepted Answer

The OECD Anti-Bribery Convention has been ratified by 44 countries as of November 2020.

Question 19

There is evidence that corruption reduces foreign direct investment from countries that have signed the OECD Anti-Bribery Convention

Accepted Answer

Studies have shown that countries that have signed the OECD Anti-Bribery Convention have lower levels of corruption and are more attractive to foreign direct investment. In contrast, countries with high levels of corruption experience reduced foreign direct investment due to the perceived risks and costs associated with corrupt practices.

Question 20

Surprisingly, virtually all cultures condemn bribery as being unethical

Accepted Answer

The answer of Surprisingly, virtually all cultures condemn bribery as...

Quiz 5: Legal Environment