The Purpose of an International Business Lawyer
An international business lawyer is a lawyer who specializes in international business law. This term covers a broad area covering laws that have been developed over the past half a century to deal with the cross-border issues of businesses both large and small, including trade regulations and treaties, tariffs, banking laws and banking relationships, contracts, labor law, environmental health and safety, service agreements, product liability, intellectual property , and taxation.
As the world becomes increasingly interdependent, in order to effectively deal with international business matters, it is essential that all relevant business issues be handled in accordance with the proper governing laws. It is the job of an international business lawyer to understand all of the specific legal issues that your company might face when involved in international business and then advise you on how to best handle those issues given the circumstances.
Roles and Services of an International Business Lawyer
An international business lawyer serves many critical roles in the successful operation of a company that has business relationships beyond its country’s borders. International business lawyers are both business advisers and lawyers, and as such, the scope of their roles and responsibilities in assisting international business clients is extensive. Common responsibilities and legal services provided by international business lawyers include:
Contract Negotiation and Preparation
Every business relationship is predicated on an agreement between the parties. It is the lawyer’s primary responsibility to both negotiate the terms and conditions of an agreement between two parties and to reduce the terms of the deal to writing in the form of an agreement or contract. International business lawyers have an expertise in cross-border transactions and the intricacies of both United States and foreign law. Contracts often must be governed by the laws of a different jurisdiction or country, depending on the subject matter and nature of the deal. Further, there may be applicable treaties and conventions to the agreement or arrangement that must be taken into consideration as well.
Dispute Resolution
A common responsibility of international business lawyers is evaluating and handling a dispute between two or more parties. International business lawyers must have a thorough understanding of international and foreign law and procedure in order to offer effective strategies to mitigate and resolve the conflict. Dispute resolution may take the form of traditional litigation, mediation, or arbitration which typically occurs in a foreign setting with foreign laws and customs. When international business lawyers successfully resolve a dispute, their client’s ability to conduct business in the future is not hampered or otherwise affected, both allowing for the client’s business to flourish as well as strengthening their bargaining power in any further dealings with the parties involved in the dispute.
Regulatory Compliance
Magnificent opportunities for growth exist for all types of businesses in other countries and continents around the world. However, with each new market that an international business enters comes the problem of understanding a foreign country’s local and national laws, regulations, tax code and procedures. There can be significant obstacles associated with entering a foreign market, particularly if the business is not set up properly or is not in compliance with local laws and regulations. Some example of regulatory compliance issues includes: establishing a business entity in compliance with foreign laws; selling or transferring intellectual property; complying with various import-export and trade laws, including tariffs; and obtaining visas and permits for entry into the foreign country.
Mergers and Acquisitions
International mergers, acquisitions and overall consolidation of business interests involves many steps, many of which require both cooperation and coordination of an international attorney. An international merger can sometimes be more difficult to complete than mergers or acquisitions that remain within the borders of a single country. A thorough understanding of each country’s legal requirements, business culture and customs is critical to the successful international merger. The basic steps in mergers and acquisitions are assessing the deal and the target companies involved, understanding and following the legal process to consummate the merger or acquisition followed by the actual closing of the transaction. The merger or acquisition process is generally very complex and should always be done with the guidance, supervision, assistance and/or oversight of an international business lawyer to ensure that all legal and regulatory processes have been followed and completed. Because a merger or acquisition could result in significant changes to a business entity, it is important that those changes do not result in greater risk or liabilities or endanger the company’s ability to continue operations in the future.
Reasons to Retain an International Business Lawyer
For companies involved in international trade, domestic trade practices and international trade law can be exceedingly complex. International business lawyers can help business owners navigate those complexities. Employing an international trade lawyer to arrange your foreign venture may well be the best course of action to take. An experienced practitioner can review your contracts with large foreign clients, suppliers and distributors, and protect you from ambiguous language and unenforceable provisions. He or she will generally be able to interpret foreign law and explain it to you clearly, so that you can follow it properly. This can help you avoid most of the problems that business owners encounter in international trade and doing business overseas. A good attorney can also help you analyze where a new market would be likely to be successful and how to go about creating a strategy for penetrating that market. An experienced international trade lawyer can assist you, your exporters, and your importers in making sure that the necessary paperwork is in order to make a smooth transition for your goods. The formalities and regulations that different countries employ can cause major delays for companies that do business internationally. Your international business attorney will advise you on what they are and how to avoid problems with regulators.
Desired Qualifications of an International Business Lawyer
To navigate the complexities of global commerce, your international business lawyer should demonstrate a range of unique qualities. To find the right fit for your business, look for an attorney who has the following skills and expertise:
Expertise in International Law
Familiarity with the laws and regulations in a variety of jurisdictions is an absolute necessity, especially when considering the tax implications of doing business in foreign countries. There are many pitfalls that await the global entrepreneur, so a lawyer with this type of knowledge and experience can be a tremendous resource to help you avoid them.
Strong Negotiation Skills
For every high-stakes deal, the role of negotiator is vital. An attorney who can advocate effectively on your behalf during contract negotiations, or when making any other agreements, can make all the difference in the success of the end result .
Cultural Competence
Every country has its own unique business culture, and in order to collaborate successfully with global partners, you need a lawyer who understands the nuances of these cultures. Tariff and trade regulations may differ from one nation to another, as can other aspects of the law that are crucial to the success of your endeavors.
Well-Versed in Alternative Dispute Resolution (ADR)
Even the most carefully laid plans can fall through, so a qualified international business lawyer can help you determine the best approach to resolving contract disputes and completing the deal. Many business lawyers are also skilled in arbitration and mediation, which are often better solutions than dragging a case through the courts.
Probable Issues in International Business Law
When facing global issues, an international business lawyer must also challenge complex factors that can be unique to your business or industry. Based on his experience with international business law, the main challenges are as follows: Jurisdictional issues, where one or more country laws are applicable to a particular matter, or when disputes arise between countries about which set of laws are proper to resolve the case (e.g. investment protection disputes where bi-lateral investment treaties exists or investment chapters in various free trade agreements). Examples of bi-lateral investment treaties are NAFTA (North America Free Trade Agreement), CAFTA (Central America Free Trade Agreement), and the China -Mexico investment treaty. Varying legal systems when dealing with differing legal systems, active litigation in multiple jurisdictions, and enforcement of international decisions. Cross-border transactions where multiple contracts must be harmoniously integrated to effectively protect all parties and/or tax and repatriate money. Ethical barriers and/or codes of behavior for legal professionals (e.g. bar membership requirements) Governing law in contract negotiations between parties in different countries.
Recent Trends in International Business Law
Several key trends are shaping how international business lawyers now operate, as well as how global companies conduct their business.
Advancements in Technology
Technological innovation played a major role in the evolution of international business law. With the rise of the internet, decentralized cloud storage, and encrypted communications, lawyers can collaborate more effectively with clients and witnesses around the world. Where previously time zone differences hampered communications and created gaps in continuity, technological solutions have largely leveled the playing field.
Even though lawyers are much more mobile than ever before, and are able to work from virtually anywhere in the world without suffering any degradation of performance, technology has not replaced the human element or the need for human interaction.
Evolving Trade Agreements
The passage of NAFTA in 1994 brought greater security to free trade in North America while allowing companies to benefit from lower tariffs, a streamlined process for settling tariff issues, increased transparency, and improved cooperation among authorities. While the agreement was a resounding success, it is also an example of the increasing complexity of international trade. Before NAFTA, there were no standards unifying the movement of goods between the countries of North America .
The complexity of international trade agreements has increased since NAFTA’s enactment, placing a larger burden on lawyers to consider the impact of each new agreement on their multinational clients. There is a growing need for lawyers who can help their clients navigate those complex agreements and develop strategies for complying with them. This is one example where technological innovation and increasingly complex trade agreements have together made the business of practicing law more "portable," allowing lawyers to work effectively in virtually any environment.
A Growing Need for Lawyers
As global business activity continues to expand, the need for qualified international business attorneys will continue to grow. Many companies choose not to use in-house counsel when dealing with relatively straightforward issues. Instead, they generally prefer to use firms with broad experience in international business law. For this reason, large firms that specialize in international law become increasingly attractive to businesses engaged in international transactions.
Continued growth in international business requires lawyers who can anticipate the future needs of their clients. If an international lawyer is not aware of the latest trends in international business law, it can steer their clients into a range of compliance and litigation issues.