International Business Law (International Trade Degree-ULE). Lesson 1. (1.1 and 1.2). Notes IBL

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Lesson 1 INTERNATIONAL BUSINESS WITHIN THE FRAMEWORK OF INTERNATIONAL TRADE.

(trad B. Valle)

INTERNATIONAL BUSINESS. LESSON 1: INTERNATIONAL BUSINESS WITHIN THE FRAMEWORK OF INTERNATIONAL TRADE.
1. Introduction
2. Subjective, objective and territorial (cross-border) aspects of International Business Law.
3. Sources of positive International Business Law.
4. Sources of Soft Law in International Business

Beaches in the Ebro reservoir. Arija

1. Introduction.

  • Law is the science that deals with facts, acts and relationships between different subjects in a particular manner: it analyzes them according to legal systems.
  • International Trade is a discipline related to International Transactions of an economic nature.
  • In this course we focus on the analysis of International Business Law from the perspective of private business law: Derecho Mercantil/Business and Commercial Law ( Business and Commercial Law) is: This is 聽a branch of Law that deals with 3 different matters: Commercial acts (such as contracts, commercial business negotiations, etc.);聽the organisation of entrepreneurs聽 (ie: companies, sole business persons, foundations involved in trades, etc. ) and market activity (unfair competition, free trade, monopolies, exchanges, etc).

 

  • Excluded from IBL are certain aspects of international trade such as tax and customs law, or the regime of cross-border workers. These will be dealt with in other subjects. In ILB we focus on business law with a cross-border connotation: commercial transactions (mainly contracts), markets (especially from the perspective of commerce) and the organisation of the entrepreneur (especially with regard to business companies).

 

  • International business law (ILB) deals with the relationships between private entities with cross-border implications
    • IBLrules the relationships between its actors (people, companies, etc). Mostly, those relationships are carried out聽 in an organizaed way with 芦commercial acts禄 such as contracts, or by creating companies or other associations, or by establishing secure payment systems, etc. Some of the consecuences of IBL are 芦mere禄 ocurrences: they can be unplanned, and they are non-contractual (i.e: an accident when carrying goods in an import-export operation): IBL is also useful to deal with such non-contractual events.
    • Business and trades take place in markets, so they must be developed within the Laws of Free Competition, the Laws on Intellectual Property, 聽the Laws on Financial Stability, etc. IBL has a lot to say in this.
    • As IBL involves a 聽cross-border element that deeply affects international business relations, it is fundamental to identify the applicable legal system or systems to each International Business Law Operation. It is also very important to find out which National Court of Justice聽 is entrusted with conflict resolution on ILB litigation. As well as to know about out of Court conflic resolution mechanisms.

 

Fruits de mer

2. Subjects, object and territorial (cross-border) issues.

  • International Business actors are natural persons and legal persons: citizens, traders, entrepreneurs, companies, groups of companies. It is, therefore, important to identify their legal capacity, nationality, etc.
    • The main actors of International Business Law are: States, International Organizations, companies and other forms of legal persons, natural persons (sole entrepreneurs) (Lesson 2). Here we deal with States and Organizations as actos in IBL (please see Lesson 2 for other actors suchas companies and private entities)
a) States
  • The sovereign States are among the Institutional players in International Law.聽 They are involved in many aspects of International Trade and IBL. In this subject we focus on the estately role in passing Laws and Regulations, in negotiationg International Treaties and Conventions (some of which create International Organizations) as well as making such Treaties聽 into enforceable Laws.
  • States have also justice-making powers through Courts of Justice and Judges.
  • Sstates regulate IBL issues.
    • i.e.: In Spain, in accordance with Article 149-1, the State has exclusive competence over (…) : 3 International Relations. 6 Commercial Law. 9. Legislation on Intellectual Property. 10. Customs and tariff regime, foreign trade.
b) International Organisations (and arrangements of the public sector):聽聽
  • The Members of these聽 Organizations are mainly States,
  • They belong to the 芦Public Sector禄 of the economy
  • Some of those Organizations can have legislative powers, when those powers have been recognized to them by their founding member- States (ie: The European Union).
  • Others are competent to draft International Agreements and Treaties, but such drafts do not acquire legal mandatory status until they are ratified by the States.
  • All of these International Organisations publish Recommendations, Guides, Model Laws and other pieces of 芦soft law禄.
  • Some International Organisations become members of other International Organisations, and/or become a member of the Treaties and Conventions.
  • Examples and classifications:
    • REGIONAL ORGANIZATIONS (3 generations)
          • 1st generation of International Organisations. They are created through Bilateral (Tariff ) Agreements.
            • Examples: Common Wealth, Francophonie, etc
          • 2nd generation. They are multilateral/purilateral. Generally they involve the creation of Free Zone Area, which can later evolve into a more complex organisation.
            • Examples are: ASEAN (Association of Southeast Asian Nations); – TLCAN/ NAFTA (North American Free Trade Agreement) whose Members are Canada, EEUU, M茅xico – EFTA (European Free Trade Association) whose members are Switzerland, Norway, Liechtenstein, Island
          • 3rd generation. Multilateral/plurilateral. They create a free zone area and also they set聽 common external tarifs. They can receive legislative powers from its Member States(ie:EU)
            • EU, EUROPEAN UNION. Regional supra-national Organization with legislative powers vested by its Member States
            • MERCOSUR (to a lesser degree)
    • GLOBAL ORGANIZATIONS SPECIALISED IN DRAFTING CONVENTIONS AND GUIDES/PRINCIPLES
  • UN BODIES AND INSTITUTIONS.聽 As it is known, the United Nations (UN) issues binding General Assembly Resolutions as well as Soft Law. Also, within the umbrella of聽 the complex UN structure we find bodies that specialise in different aspects of IBL:
  • GLOBAL TRADE ORGANIZATIONS
  • INTERNATIONAL FINANCIAL INSTITUTIONS聽. They are involved in financing world development specially in underdevelopped countries as well as in coordination and leading world wide financial policy making
  • OTHER INTERNATIONAL 芦ARRANGEMENTS禄 / CONFERENCES. Here we classify some聽 International arrangements that聽 do聽 not聽 create聽 a full organization, although they聽 can be very influential
    • *GATT,聽 General Agreement on Trade and 聽Tariffs聽 This is an International,聽 Multilateral Agreement. Originally signed in 1948, covering International Trade on Goods. The Gatt itself is not an International Organisation. Before 1995, its members met up in 芦Rounds禄 to deal with specific aspects of IT. In 1995 by the end of its 芦Uruguay Round禄, at the Marrakech Summit, its members created the World Trade Organisation (WTO), an International Organisation with main Headquarters. After 1995. Today, 聽GATT operates through a General Council, within WTO
    • GATT聽 functions with some 芦Operating Principles禄 which have been accepted by most other International Organizations and arrangements禄
      • Free Trade
      • National Treatment
      • Most Favoured Nation
  • G 20.聽The聽G20聽(or聽G-20聽or聽Group of Twenty) is an international forum for the Heads of State and /or Governments, Financial Ministers and Central聽 Bank Governors from 20 major economies. Founded in 1999, the G20 aims to discuss policy issues pertaining to the promotion of international financial stability. After its inaugural leaders’ summit in 2008, its leaders announced on 25 September 2009 that the group would replace the G8 as the main economic council of wealthy nations.
  • Brics, Shangai Cooperation Group, among others)

c) Private Sector Organizations with International Impact聽

  • Private Sector Organisations are those whose聽 members are Private entities (ie: Companies, Consultants, etc). Some are very prestigious. So, their resolutions and documents are great influencers in International Business Law, mainly in the fields of Contracts and Dispute Resolution. They can never pass legislation but they draft Soft Law
    • Example of these Organisations:
        • ICC. International Chamber of Commerce. Founded in 1919 in Paris. It is a known centre of International Arbitration since 1923, it acts as a consultative body to UN since 1946.聽 聽 ICC drafts Soft Law聽 in the form of Contractual Clauses聽 such as the 芦International Commercial Terms, INCOTERMS widely used in the International Trade of Goods. It is a world leader in international out of court dispute resolution (artibration)
        • International Standardization Office (ISO), ISO is an independent, non-governmental international organization with a membership of 167 national standards bodies. Through its members, it brings together experts to share knowledge and to develop voluntary, consensus-based, market relevant International Standards useful in industry througout the World.
        • International Financial Reporting Standards Foundation (IFRS) The IFRS Foundation is a not-for-profit, public interest organisation established to develop high-quality, understandable, enforceable and globally accepted accounting and sustainability disclosure standards. Those Standards are developed by IFRS’s聽 two standard-setting boards, the International Accounting Standards Board (IASB) and International Sustainability Standards Board (ISSB).
        • Some are , professional International Organizations, such as :

d) Hybrid Organizations (private sector and -public sector members)

  • Hybrid Organizations (private- public sector members)
    • International Organizations of Securities Commissions (IOSCO). The International Organization of Securities Commissions (IOSCO) is the international body that brings together the world’s securities regulators and is recognized as the global standard setter for the securities sector. This is a public sector organization that allows for private entities to become affiliated to it.
      • There are three categories of members:
        • IOSCO’s聽 the ordinary members (130) are the national securities commissions or similar governmental bodies with significant authority over securities or derivatives markets in their respective jurisdictions.
        • Associate members (34) are usually supranational governmental regulators, subnational governmental regulators, intergovernmental international organizations and other international standard-setting bodies, as well as other governmental bodies with an appropriate interest in securities regulation.
        • Affiliate members (69) are self-regulatory organizations, securities exchanges, financial market infrastructures, international bodies other than governmental organizations with interests in securities regulation, investor protection funds and compensation funds
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1.3 // 1.4 Sources of the Law (and soft law) of IBL

(classroom notes) (thaught in Spanish)

 

 


(To complete with 1.3/ Sources of IBL in the classroom)

Publicado por

Elena F P茅rez Carrillo

Doctora en Derecho. Profesora de Derecho Mercantil Universidad de Le贸n