Question 1

Confiscation of property by a foreign government for nonpublic purposes without adequate payment violates generally observed principles of international law.

Accepted Answer

Confiscation of property without adequate payment violates the principle of eminent domain, which is recognized by most nations and international law.

Question 2

The United States has, in 1993, withdrawn from participation in the General Agreement on Tariffs and Trade
(GATT).

Accepted Answer

The United States did not withdraw from GATT in 1993. Instead, GATT was replaced by the World Trade Organization (WTO) in 1995, and the United States became a founding member of the WTO.

Question 3

The choice-of-forum clause in an international business transaction will dictate what country's law the forum will apply should a legal dispute arise.

Accepted Answer

The choice-of-forum clause dictates where (in which jurisdiction or court) a legal dispute will be adjudicated, while a choice-of-law clause determines which country's law will be applied to the dispute.

Question 4

The Constitution authorizes the president to enter into treaties having the legal force of a federal statute without having to go through the legislative process or without having to receive advice or consent of the federal legislative branch of government.

Accepted Answer

The Constitution requires that the president must receive the advice and consent of the Senate, with a two-thirds majority, to enter into treaties, making it necessary to go through part of the legislative branch process.

Question 5

The Wall Street Reform and Consumer Protection Act of 2010 extends the extraterritorial reach of the antifraud provisions of the 1933 and 1934 securities acts with respect to actions brought by the United States and the SEC.

Accepted Answer

The Wall Street Reform and Consumer Protection Act of 2010 does indeed extend the extraterritorial reach of the antifraud provisions of the 1933 and 1934 securities acts with respect to actions brought by the United States and the SEC.

Question 6

NAFTA established a free trade area for the United States, Mexico, and Central America.

Accepted Answer

NAFTA established a free trade area for the United States, Canada, and Mexico. It did not include Central America.

Question 7

Parties to an international sales contract may expressly exclude CISG governance from their contract.

Accepted Answer

Parties to an international sales contract can choose to opt-out of the CISG by explicitly stating their intention to exclude its application in their contract.

Question 8

Under the doctrine of sovereign immunity, domestic courts, in certain circumstances, will exercise jurisdiction over a foreign state or its instrumentalities.

Accepted Answer

The answer of Under the doctrine of sovereign immunity, domestic...

Question 9

A foreign agent is used by multinational enterprises to take title to merchandise and bear the risks connected with international sales.

Accepted Answer

A foreign agent is used by multinational enterprises to facilitate international sales and assist in marketing, but they typically do not take title to merchandise or bear the risks associated with sales. This is more commonly done by import/export brokers or freight forwarders.

Question 10

Although under GATT's most-favored nation provision all signatories must treat each other as favorably as they treat any other country, nations may give preferential treatment to developing nations and may enter into free trade areas.

Accepted Answer

GATT's most-favored nation provision requires equal treatment of all member countries, but exceptions are made for developing nations and free trade areas.

Question 11

Businesses which wish to safeguard their technology while doing business in the international sector would not want to consider the use of wholly owned subsidiaries.

Accepted Answer

Wholly owned subsidiaries allow businesses to maintain full control over their technology and operations, making them a viable option for safeguarding technology in international markets.

Question 12

The concept of sovereign immunity provides that a nation's judicial branch should not question the validity of the
actions a foreign government takes within its own borders.

Accepted Answer

The answer of The concept of sovereign immunity provides that...

Question 13

In a foreign distributorship arrangement, the foreign distributorship in the importing country purchases the goods from the manufacturer in the exporting country.

Accepted Answer

In a foreign distributorship arrangement, the foreign distributor in the importing country purchases the goods from the manufacturer in the exporting country.

Question 14

One risk of investing in foreign states is the risk that the host nation's government may take the investment property.

Accepted Answer

This risk is known as political risk, and it is a common concern for investors who are investing in foreign countries. Host nation governments may expropriate assets or nationalize industries, resulting in losses for foreign investors.

Question 15

Expropriation of property by a foreign government for a public purpose with the payment of just compensation, but without the consent of the owner violates generally observed principles of international law.

Accepted Answer

Expropriation of property by a foreign government for a public purpose, with the payment of just compensation, even without the consent of the owner, is generally considered consistent with international law, provided it is done in a non-discriminatory manner and in accordance with due process.

Question 16

The International Monetary Fund was established in 1945 to promote international monetary cooperation and now has approximately 50 member countries.

Accepted Answer

The International Monetary Fund (IMF) was indeed established in 1945, but it currently has 190 member countries, not approximately 50.

Question 17

Under U.S.law, the CISG does supersede the UCC whenever the CISG applies.

Accepted Answer

The United Nations Convention on Contracts for the International Sale of Goods (CISG) is an international treaty that governs contracts for the sale of goods between parties from different countries. Under U.S. law, the CISG takes precedence over the Uniform Commercial Code (UCC) when there is a conflict between the two laws and the CISG applies.

Question 18

Like domestic law, international law can be easily enforced, because international courts have compulsory jurisdiction.

Accepted Answer

International law lacks a centralized enforcement mechanism, and enforcement largely relies on voluntary compliance by states. International courts do not have compulsory jurisdiction, meaning that states must agree to submit to their authority before their jurisdiction can be enforced on those states.

Question 19

International courts have compulsory jurisdiction to resolve international disputes, and they have the authority to resolve an international dispute even if the parties to the dispute do not specifically accept the court's jurisdiction over the matter.

Accepted Answer

International courts typically require the consent of the parties involved in a dispute to have jurisdiction. Without such consent, these courts generally cannot compel states to participate in proceedings or enforce judgments.

Question 20

International law is derived from the Code of Federal Regulations and international legal tribunals.

Accepted Answer

International law is not derived from the Code of Federal Regulations, which is a set of domestic regulations in the United States. International law is derived from international treaties, agreements, customary practices, and decisions of international legal tribunals such as the International Court of Justice.

Quiz 46: International Business Law