Asked by OLUSEGUN ADELEKE on Apr 25, 2024
Neptune Inc., an American consumer electronics company, wants to start its operations in Javaheria, a country in South America. Javaheria has a low degree of rule of law. Given this information, it can be said that:
A) Javaheria has business laws based on fairness and justice as these concepts are understood by the companies operating in the country.
B) Javaheria has laws that specify that justice is indifferent to the status of any who violate the law.
C) Neptune Inc. is more likely to face the risk of having its overseas property and goods confiscated at the whim of a politician.
D) Neptune Inc. is less likely to face transactional risks, such as fraud, negligence, and bad debts, associated with international transactions.
Rule of Law
The principle that all individuals, entities, and government are accountable to laws that are publicly promulgated, equally enforced, and independently adjudicated.
Confiscated
Property that has been taken away from its owner by a governmental authority as a penalty or for regulatory reasons.
Transactional Risks
The potential for financial loss that a company faces when engaging in business transactions, especially in foreign markets.
- Understand the concept of the rule of law and its implications for international business.
Learning Objectives
- Understand the concept of the rule of law and its implications for international business.