International Marketing Challenges
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International Legal Issues
Countries differ in their laws as well as in their interpretation of their laws. Some countries place a greater emphasis on the role of the court and litigation system, whereas others encourage alternate dispute resolution wherever possible. It is crucial that you have an understanding of international and local legal issues prior to entering into a new market.
Anyone who is engaged in business should have a basic understanding of the basis of law around the world. Legal systems are split into two groups; common law and statutory law. Common law relies on precedent and tradition to arrive at decisions. It is based on past decisions of similar cases to determine rulings. As common law is not always clearly defined or definite, it is open to interpretation and care must be taken when working under an unfamiliar foreign legal system.
Statutory law is based on a set of written statutes and legislation that set out legal rules. It is a more inflexible legal system and less open to interpretation. The benefit of statutory systems is that you can generally get a clear definition of what is and is not allowed. Many legal systems around the world use a combination of common law and statutory law to decide cases.
When engaging in international marketing, it is vital that you ensure you understand the local laws that apply. In most cases, foreigner organisations will not be able to use ignorance as a viable defence for failing to follow the local law. If you are unsure about anything, get the advice of a local, experienced legal professional.
If a legal dispute involving your organisation arises in a foreign country, it can place a significant burden on you and your business. You may need to stay within the country until the issue is resolved and pay numerous legal expenses. Dispute resolution processes vary, with many countries encouraging out of court settlements for disputes between organisations.
Intellectual property protection is another issue that needs to be considered when entering new markets. Products, designs and trademarks that you have registered in one country may not apply internationally, leaving your organisation open to exploitation from other businesses. It is important that you seek legal advice and ensure you have the necessary protection prior to entering a new market.
The consequences for breaking the law vary depending on which country you are in. This is an important consideration that is overlooked by many international businesspeople. They sometimes find themselves in legal disputes where the consequences for being found guilty of breaking the law are far more severe than what they would encounter in their home country. Ensure that you have a thorough understanding of not only international laws, but the ramifications for breaking them as well.
Conducting a thorough legal analysis will help you to develop your understanding of potential international markets. You can combine your analysis with your research on the political and economic climates and make an informed decision about entering a foreign market.
 International Marketing, Czinkota and Ronkainen, 9e 2010