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Legal Aspects of Doing International Business

Creating a Contract, What Not to Miss,

What to Look Out For

Cornerstone Alliance November 13, 2015

Jean G. Schtokal, Shareholder

Legal Aspects of Doing International Business - November 13, 2015 Creating a Contract, What Not to Miss, What to Look Out Fort

2 2015, Foster Swift Collins & Smith PC

Jean G. Schtokal

Shareholder and International Trade Lawyer at Foster, Swift, Collins & Smith, P.C. ■ [email protected]

Over 20 years of practice in business and international law Appointed Chair to Michigan District Export Council-West by U.S. Secretary of Commerce (Chair) Advisory Board of Michigan State University’s Center for International Business Education and Research Co-Chair of the Global Business Club of Mid-Michigan Best Lawyer’s in America (International Trade and Finance Law) Executive-in-Residence, Michigan State University – The Eli Broad College of Business, International Business Center Michigan Lawyers Weekly Women in the Law 2013

mailto:[email protected]



Legal Issues Arise all Along the International Trade Spectrum

Export Intention Export Income



Overview of Some Tips and Pointers Regarding Sales and Agent/Distributor Relationships

Due diligence on your representative/customer Know your territory Intellectual property protection Export controls Local foreign laws affecting product or service and relationship U.S. laws affecting the relationship and the representative Key terms



Due Diligence

U.S. Department of Commerce background check (International Company Profile)

U.S. Embassy

Prohibited Persons/Restricted Party Screening and Embargoes

Transparency International www.transparency.org

TRACE www.traceinternational.org

http://www.transparency.org/

http://www.traceinternational.org/



Know Your Territory

globalEDGE

“Doing Business in” guide and modules

Trade Associations/Business Organizations

Trade Agreements

U.S. District Export Councils

Global Business Club of Mid-Michigan



Intellectual Property Protection

A U.S. trademark or patent provide protection of intellectual property in the U.S. only

In-country registration/protection

Non disclosure agreements/provisions

“Naked” license issue (maintain control)



Export Controls

Exporting is a privilege, not a right. Does your product/service require an export license or approval prior to export?

Office of Foreign Assets Control Regulations (OFAC)

Export Administration Regulations (EAR)

The International Traffic in Arms Regulations (ITAR)

The “Lists”

Anti-boycott Laws



Local Foreign Laws Affecting Product and Relationship

When you do business in a foreign country laws there may apply to you and your transactions.

There will be some — do your homework with your international trade lawyer and local counsel Examples — ■ Protections for Agents (termination payments) ■ Restrictive Covenants (constitutionality) ■ Import Laws ■ Product Regulations/Licenses/Registrations ■ Representative Requirements (possible registration) ■ Competition Laws ■ Tax Laws



Key Terms for Agent/Distributor Contracts

Proper Classification of Relationship — Agent/Distributor/Broker/Finder/Sales Representative Exclusivity Territory Product Description Compensation, Commissions, and Discounts Performance Standards Investments Sales Terms and Conditions Tax and Employment Law Issues



Key Terms . . . Cont’d

Warranty and Service Liability/Indemnity/Insurance Term and Termination Confidentiality Intellectual Property Rights/License Choice of Law Dispute Resolution Compliance with Laws

See Helpful Resources



Presentation Terms of Use Foster Swift Collins & Smith, PC presentations are intended for our clients and friends. This presentation highlights specific areas of the law. The information provided is current as of the date of the presentation. Those viewing the presentation should consult an attorney to determine how the information applies to any specific situation. Notice Other U.S. Departments and governmental agencies also regulate exports, including the U.S. Department of Energy, the Nuclear Regulatory Commission, Food and Drug Administration and the Drug Enforcement Administration, among others. Other countries also regulate exports/imports and have anti-bribery legislation. Copyright © 2015 Foster Swift Collins & Smith, PC



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