Under contract terms “DES Stockholm,” the seller must pay the ocean freight to
Stockholm, but the buyer pays the unloading charges at the Stockholm terminal.
a. True
b. False
A good faith purchaser is one who purchases a document of title:
a. For value, in good faith, in the ordinary course of business.
b. For value, in good faith, directly from the seller.
c. In good faith and by endorsement from the seller’s bank.
d. With understanding that the seller had acted in good faith in selling the goods.
The country of origin is always determined by the WTO definition where the article is
grown, produced, or manufactured.
a. True
b. False
Liquidation of goods must occur within three months of entry and cannot be extended.
a. True
b. False
Environmental issues are generally limited to cross-border pollution such a between the
United States and Mexico.
a. True
b. False
Which law imposed the highest tariffs in U.S. history, causing worldwide retaliation?
a. Hoover Act of 1930
b. Treaties in Force Act of 1912
c. Smoot-Hawley Tariff Act of 1930
d. Reciprocal Trade Agreements Act of 1934
Under the Full Faith and Credit Clause of the U.S. Constitution, a decision by a New
York court will be enforced by a Georgia court.
a. True
b. False
Under U.S. antitrust law, the rule of reason applies to situations where:
a. A person must decide to bring a lawsuit or not.
b. Through analysis, an action is not found to be anticompetitive.
c. The amount of damages awarded is reasonable.
d. A merger is anticipated and valid if reasonable.
Most of the developing countries of Africa and Latin America are free from the
environmental pollution of the heavily industrialized nations.
a. True
b. False
The analytical framework established by American antitrust law distinguishes between
actions that are wrong per se and actions to which the rule of reason applies.
a. True
b. False
The FCPA requires that individuals and corporations meet disclosure requirements for
all monies sent abroad as payment for fees owed to their sales agent.
a. True
b. False
Aeroflop, a U.S. firm, wants to sell several million dollars worth of airplanes to a
government-owned airline in a European country famous for cheese. In order to get the
contract, Aeroflop agrees to pay a 5% kickback to another
U.S. company if that company agrees to buy all of its cheese from a seller in that
European country.
a. Aeroflop’s sale to the government-owned airlines is allowed under the Agreement on
Government Procurement.
b. Aeroflop’s sale is prohibited because the Agreement on Government Procurement
prohibits offsets.
c. Aeroflop’s sale is allowable because the European nation is treating Aeroflop no less
favorably than its nationals.
d. The WTO dispute resolution panel must authorize both contracts prior to the sale.
California Agricultural Aircraft Services, Inc. (CAAS) is a California corporation
headquartered in Sacramento.
CAAS leases aircraft to crop dusting businesses through California. On October 6,
2006, CAAS entered into a contract with Jinshan Export Company (JEC), a private
Chinese enterprise engaged in the businesses of export facilitation and sales agency, and
Shà nghai Aircraft Company (SAC), a stateÂowned enterprise organized pursuant to
the laws of the People’s Republic of China. The contract provided for the manufacture
by SAC and purchase by CAAS of ten crop dusting aircraft at a price of U.S. $2.1
million, a savings of approximately $200,000 compared to crop dusting aircraft
available from other manufacturers. In order to avoid problems arising from the sale of
Chinese aircraft in the United States, JEC and SAC agreed to fabricate the aircraft parts
at SAC’s Chinese manufacturing facility but perform the actual assembly at its facility
in Mexico. SAC would then export the aircraft to CAAS claiming they were products of
Mexico subject to duty-free treatment pursuant to the North American Free Trade
Agreement. Unfortunately, U.S. Customs classified the aircraft as products of China,
denied the request for duty- free treatment pursuant to NAFTA and assessed the
applicable tariff on aircraft originating from China. How will
U.S. Customs Service and Border Protection determine the country of origin of the
aircraft? What factors may Customs utilize in making this determination? Applying
these factors to the above-stated facts, are the aircraft products of China or Mexico?
Applying these factors, are JEC, SAC and CAAS likely to prevail if they challenge
Customs’ decision?
Most nations grant patent priority to the individual who can prove (s)he was the first to
invent.
a. True
b. False
The bill of lading serves as a contract of carriage between the buyer and seller.
a. True
b. False
The Bhopal disaster taught American corporations that they could insulate themselves
from legal liability by having foreign control of the plant.
a. True
b. False
The Uruguay round of tariff negotiations was the first major multilateral trade
negotiating session since World War II.
a. True
b. False
Assume that DownPillow sells pillows to a Japanese buyer and forwards documents
and a draft for acceptance.
Assume also that DownPillow discounts the trade acceptance to a U.S. bank, which
then discounts the instrument in the credit markets. If the pillows turn out to be moldy
and worthless, which of the following statement(s) is (are) true?
a. The Japanese buyer does not have to pay because the pillows are damaged.
b. The U.S. bank must reimburse whoever bought the instrument and can bring a
lawsuit for payment against DownPillow.
c. The Japanese buyer must still honor and pay the acceptance upon presentation.
d. A and B.
e. All of the above.
Because the laws are similar in most countries, there are few problems with
international sales contracts.
a. True
b. False
Europeans tend to feel that over a period of time, employees acquire a property interest
in their jobs.
a. True
b. False
Global sourcing is the term commonly used to describe the process by which a firm
attempts to locate and purchase goods or services on a worldwide basis.
a. True
b. False
You are an international human resources consultant retained by Pacific Paper Products,
a U.S. corporation headquartered in Seattle. PPP recently downsized its operations
located in Germany, which resulted in significant layoffs. The basis of this decision was
the inability of the German plants to generate sufficient revenues. Although marginally
profitable, PPP concluded that it would be fiscally prudent to downsize the facilities.
PPP provided ten days written notice to their employees at these facilities prior to their
termination. In response, the employees have submitted claims for wrongful discharge.
You have been retained to advise PPP’s board of directors on the validity of these
claims. Did PPP’s closure of the plant violate German law? Are the former employees’
claims for wrongful discharge valid? Why or why not?
Scenario
A cash payment of $250,000 made by Durdy Coal, Inc., a U.S. corporation, to DCI’s
agent with the instruction “put this to good use on DCI’s behalf” which in turn is paid to
the State Importation Officer of the People’s Republic of China in order to secure a
Chinese import license.
Scenario
An attempt by an American buyer to avoid payment for goods received from a French
seller based upon a letter providing that the goods were “deficient in quality.”
K&L Chemicals is a U.S.-based manufacturer of agricultural chemicals. K&L recently
sold two thousand gallons of its most toxic pesticide to Sahara Traders, a company
headquartered in the North African desert nation of Chad. Sahara Traders refused to
disclose the use that it intended to make of the product and paid cash upon its delivery.
Sahara ultimately shipped the pesticide to the North Korean government for use in its
chemical weapons program. Is K&L liable for the ultimate transshipment of its
pesticide to North Korea? Please explain your answer.
Would the marine carrier be liable in each of the following scenarios applying COGSA?
The failure of the ship to unload its cargo on time at the destination port due to a
longshoreman’s strike.
The failure of the ship to unload its cargo on time at the destination port due to a route
change necessitated by engine failure occurring after the ship left the port of shipment.
A lawsuit by a seller and a buyer against a carrier for damage to goods filed 18 months
after their delivery. The failure of the ship to unload its cargo on time at the destination
port due to its overloading at the port of
shipment.
The failure of the ship to unload its cargo on time due to the threat of a terrorist attack
at the port of destination. A notice of damaged goods given by a buyer to the carrier 10
days after the buyer’s receipt.
Scenario
Tax credits extended by the Japanese government to Japanese computer chip
manufacturers on the basis of the volume of their chip sales in the United States.
Scenario
A birthday card and bottle of California wine sent annually by Woody Pulp, the chief
executive officer of Pacific Paper Products, Inc., a U.S. corporation, to his
long-standing friend who is the Director of Government Procurement for the Japanese
government.
Scenario
Tax credits extended by the government of India to Indian companies in order to assist
in the reduction of greenhouse gases emitted during the manufacturing process.
The President of the United States is concerned about the declining number of
American companies engaged in the manufacture of computer chips. In order to
reinvigorate U.S. computer chip manufacturers, the President has proposed that the
United States unilaterally impose an absolute ban upon the importation of computer
chips from Japan for an indefinite period of time to be determined in his complete
discretion. The President has asked you whether his proposal is legal pursuant to the
GATT. What is your response? Please explain the basis for your conclusions.