The government in Chile recently informed Clint Travis' company that his retail grocery chain in Chile would have to be gradually turned over to the people of Chile by the year 2050 as it is a foreign company in Chile. Additionally, starting next year 50 percent of the board of directors of the Chilean operation of the company must be Chileans. Which of the following political risk actions is Mr. Travis' company facing in Chile?
A) Confiscation
B) Expropriation
C) Domestication
D) Patronization
E) Socialization

Question

Quizplus · Accepted Answer

Domestication occurs when host countries gradually cause the transfer of foreign investments to national control and ownership through a series of government decrees that mandate local ownership and greater national involvement in a company's management. As Clint's company is gradually transferred to the control of the Chilean government, his company is facing domestication.

The Government in Chile Recently Informed Clint Travis' Company That