Impact Of Protection Of Designer Products - 3018 Words

GLOBALIZATION AND GLOBAL CITIZENSHIP- TRIMESTER A PRESENTED BY: PRAKRITI CHOPRA PCHOPR201@caledonian.ac.uk IMPACT OF PROTECTION OF DESIGNER PRODUCTS RECEIVED BY ONLINE RETAILERS IN UK AND INDIA Abstract (optional): a 300-400 words summary of the paper IMPACT OF PROTECTION OF SMALL-SCALE DESIGNER PRODUCTS/ CUSTOMIZED PRODUCTS RECEIVED BY ONLINE RETAILERS IN UK AND INDIA †¢ Introduction Online shopping has now become one of the most popular ways of shopping globally. It saves time of going to a store and purchasing a particular product. Further such online retailers even offer various deals on the same products that one does not find in-store, so it helps save money on the some product. This online†¦show more content†¦However, this research basically focuses on the impact of protection of small-scale designer products received by online retailers in UK and India. The significance of designs is extensively acknowledged and recognised in the present UK economy. India has also been a member of World Trade Organisation (WTO) since 1995; and all the signatory nations to WTO are bound to include some IP protection in their national laws. Further, since the Indian Constitution is borrowed from the UK constitution, there are similarities in the laws of both the countries. This indicates that any country doing business with India will find similarities between the local IP laws and enforcement procedures, and those in force in the UK. (IPO, 2013) In this research the author gives a brief overview of the design rights available to a design company in the UK and India, analysis of those rights and enforcement procedures. †¢ Background Intellectual property (IP) rights -In India One of the crucial factors in the Indian legal system is to register and enforce intellectual property rights. To enjoy the IP rights it is a must to register them. In India when an individual or company wants to patent a product they should individually register. Apart from the industrial designs the individual or company can apply under the terms of the Patent Cooperation Treaty, which is usually

Essay about Cultural Differences Witness - Peter Weir...

The film Witness, directed by Peter Weir portrays the concept of cultural differences between the Amish and the outside world through various film techniques. Weir demonstrates aspects of moving into the world using symbols, characterisation, setting and diegetic and non-diegetic sounds so to convey the significant cultural differences within the film. The contrast of the Amish and the outside world is expressed in the barn scene. The scene opens with the car, which is a symbol and motif of the outside world. The car is placed in the barn which further demonstrates the contrast of both cultures. It is clear that the car doesn’t belong with the barn, as in Amish culture technology isn’t used, especially cars. As John Book fixes the car†¦show more content†¦This is further implied through John singing the lyrics ‘that I love you and I know that if you love me too what a wonderful world this would be’ This indicates the possibility of how things would be if their cultures were more accepting. The contrasts of both cultures are expressed through the mid shot of both characters as they are caught by Ellie. The car lights shine on Rachel and John, which emphasise that they have been caught in the act and that their actions are ‘immoral’, as the Amish are not to use technology, let alone listen to English music this is further supported by the close up shot of Ellie’s surprised and disappointed expression. Towards the end of the film, there is a scene which highlights cultural differences. In this scene Rachel and John are saying goodbye as John goes back to the outside world. In this scene, it is demonstrated through the close up shots of both characters gradual smiles and combination of hopeful non-diegetic music, that they have realised and accepted that John doesn’t belong in Rachel’s Amish community and must go back to his world. The cultural differences are made prominent through setting and costuming. The juxtaposition of John’s suit, the land and the bird house emphasises the differences in culture as a suit is typically worn everyday in the modern world for work, however he wears the suit on the natural landscape which signifies his lack of connection to the Amish world. The acceptance of John’s departureShow MoreRelatedWitness: Amish World Essay868 Words   |  4 PagesThe thriller film ‘Witness’, directed by Peter Weir in 1985, tells about cultural conflicts between the Amish of Western Pennsylvania and Modern American corruption and violence. Philadelphia Police officer, John Book was obligated to hide from the three brutally and corrupt police officers as they were looking for a little Amish boy, Samuel Lapp. The boy witnessed the brutal killings and identified the killer as the three police officers. The ‘Witness’ strongly displayed many images of people andRead MoreSocial Norms around the World879 Words   |  3 Pagesare eating it with sounds in Japan. While in china, eating food with sounds means rudeness. This interesting example shows that there are huge differences among kinds of social norms. In the film Witness, director Peter Weir explores the distinct and huge cultural conflicts between the old Amish society of western Pennsylvania and the modern American world of crime and violence. The main character, Philadelphia police detective John Book, is forced into hiding by a group of corr upt fellow officersRead MoreWitness by Peter Weir Notes12043 Words   |  49 PagesNOTES ON MODULE B, WITNESS BY PETER WEIR, 1985 Introduction: * Engage in a detailed analysis of a text * Understanding of how the ideas, forms and language of a text interact within the text and may affect those responding to it. * Students will need an understanding of film techniques and of the police drama genre. Important aspects to know: * Visual techniquesenhance understanding of characters * Editing techniquescreate suspense, establish characters, create atmosphere, positionRead MoreThe Clash Between Amish Culture and Modern American Culture in the Film Witness2140 Words   |  9 PagesThe Clash Between Amish Culture and Modern American Culture in the Film Witness Witness is a mix of genres; it has romance, action, is part murder/detective story, and is a thriller. The aim of the director, Peter Weir, is to show the clash of cultures between the Amish and the Modern American culture. Peter Weir the director likes to place characters into an unusual situation like in this film he has a Pennsylvanian cop, John Book, having to hide and live in an Amish Read MoreEssay on Mateship in Australian Films5134 Words   |  21 Pagesmateship and the image of men as mates did not go unchallenged. Australian cinema as a significant part of the whole industry of image-makers in the country, the way it portrays mateship, the single most important mythic element in the cultural identity of Australia, is worth analysing. This paper first reviews the historical background of mateship in Australia and its contemporary development. The review here serves as a general discussion of mateship that provides the potentialRead MoreOrganisational Theory230255 Words   |  922 Pagesthis respect you will find this book timely, interesting and valuable. 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They range in value from  £0.75 million to over  £60 million, and total over  £100

Advanced Taxation Income Tax Assessment Act

Question: Discuss about theAdvanced Taxationfor Income Tax Assessment Act. Answer: Introduction According to the Income Tax Assessment Act 1997, TR2012/D1 income from the trust estate is distributable to the beneficiaries as per the clauses mention in the trust deed. As contained under section 53A, income generated from the trust estate is computed according to the terms and conditions of the trust deed. Such distributable income is taxable in the hands of beneficiaries at the rate specified under the provision of Australian Taxation System (Hoynes, Miller and Simon 2015). As per TD 2001/26 if a beneficiary of the trust estate has interest in the value of assets and the income for the allocation of the assets then the beneficiaries can renounce their interest in the trust. As per section 98(3) and 98(4), income from trust estate is liable for taxation in the books of trustee with respect to the share of income on part of its beneficiaries (O'Connor 2016). In the given case, Bruce the sole executor of Pams estate that was created under a testamentary trust managed business tax loss amounted to $20,000 during the year 31 August 2014. On the contrary, the testamentary trust incurred profit during the year ending 30 June 2015 amounted to $200,000 whereas the taxable income during the same period is $180,000. Considering the terms and conditions of the trust, Bruce allocated the trust income earned to the beneficiaries during the year 2015 on the basis of allocated percentage (Doidge and Dyck 2015). Bruce distributed the amount $40,000 to one of the beneficiaries Ronda whereas 50% of the balance i.e. 50% ($200,000- $40,000) = $80,000 to Rani as well as $80,000 to himself as 50% of the balance income. Further, Bruce distributed 20% of the income to the beneficiaries from the sale of premises since the balance income was meant for further investment. However, the income from the sale of premises was distributed to Gina as per the clause of c apital distribution on 18 July 2015, which was recorded on 29 August 2015 (Harrison 2015). According to the Australian Taxation System rules of section 102- 25 is applicable to the income arising from the capital asset of the discretionary trusts. As per the data provided for the BCL Ltd income from the capital assets are taxable in the books of the company as distributed to the beneficiaries (Chua and Bedford 2015). Given that, the selling value of the premises is $2,400,000 whereas the cost of the premises is 800,000, which was acquired on 23 October 1999. Therefore, income on sale of premises amounted to ($2,400,000- $800,000) = 1,600,000 that is taxable as per the taxation rules. As per the taxation ruling of ITAA97 tax on the income $1600,000 at the rate of 45% amounted to $720,000. Since, Bruce distributed the part of income to one of the beneficiaries at 20% and the rest of the amount is used for investment purpose therefore the taxability of $720,000 is subjected to the discounting method at 50%. However, the business loss amounted to $190,000 incurred during the y ear 2012-13 would be carried forward to till the year 2015. During the financial year 2015, loss of amount $190,000 can be set off with the income earned during the year amounted to $200,000 which will minimize the tax liability of the assessee (Neuman, Omer and Thompson 2015). Income distributed to Ronda $40,000 is entitled to tax liability during the year 2015 at the rate specified in the taxation system of Australia. As per the taxation rules, distribution of income from the trust estate is taxable in the hands of trust distributor at the rate of 45%. Hence, the income of $40,000 is taxable in the books of Bruce at the specified rate. Similarly, income distributed to Rani amounted to $80,000 is taxable in the books of Bruce during the year 2015. However, income with respect to capital distribution amounted to 20% of would be taxable during the financial year 2016 because the amount has been allocated to the beneficiaries after the end of financial year 2015 (Kousky and Shabman 2015). Considering the consequences of taxation of income from trust, Bruce is required to pay taxes on the income from trust as well as income from capital assets during the year 2015. However, the taxability of the income is subjected to the deduction of discounting method with respect to the capital income. On the other hand, current income from the trust will be taxable by deducting the amount of total loss of $170,000 incurred during the year 2013 since it was incurred from the business operation of the assessee (Doidge and Dyck 2015). Part A In the given situation, Lawrence Dixon and Sonya Dixon formed a family trust whose trustee was the accountant of the family Mac Bury. The trust was created as a discretionary while the beneficiaries of the trust were the creators children. It has been provided that the trust acquired a rental property and securities in two listed companies. During the year 2015, total receipt of the trust amounted to $26,000 whereas the expenses amounted to $26,000 along with the depreciation charges of $3,000 as per section 40- 25 ITAA97 (Tucker 2015). Further, amount of $8,000 as an interest expense was in terms of the securities of AMP Ltd for acquisition of shares. In case of discretionary trust, beneficiaries are not entitled to have fixed interest income in the funds of the trust. Under the category of discretionary trust beneficiaries are eligible to determine the income as capital or revenue as well as the percentage at which the income is to be received. For the purpose of establishment of the trust, there must be four important roles in the form of creator, trustee, appointor and beneficiaries. Trustee is considered to be the legal owner of who maintains all the transactions having the authority to sign the documents and other relevant applications for approval (Feuer 2016). On the other hand, beneficiaries of the trust are the individuals for whose advantages of the trust property is acquired. However, it is important that the beneficiaries should not acquire any substantial interest in the trust assets but they can have the right to access the share income from the securities of the trust. Discretionary trust is formed to utilize the be nefit of tax liability, asset protection, estate planning and holdings of land with respect to the investments, real estates and sources of fixed assets. As per the TR in ITAA97, assessees are eligible to claim exemption of 50% from the capital gain taxation provided the beneficiaries are individuals and not business organizations (Feisee and Randall 2015). Accordingly, in the present situation discretionary trust has been formed which earned total income of $26,000 while the expense were also $26,000. As per TD 2001/26, income from the assets and securities earned by trust is taxable even if such income is distributed to the beneficiaries. Therefore, income earned as dividend from the shares of AMP Ltd, CBA Ltd amounted to $12,000, and $8,000 respectively shall be taxable in the books of the trust created by Dixon. Further, deduction on the interest expenses is available to the trust amounted to $8,000 as well as the depreciation charges amounted to $3,000. However, beneficiaries are exempted from the tax liability on the since the beneficiaries are individuals and have no substantial interest in the assets of the trust (Tool, Williamson and Whittenburg 2015). On the contrary, expenses on rent for the property amounted to $18,000 are entitled for deduction from the income earned during the current taxation year. Part B The present case highlights the consequences of tax losses earned by the discretionary trust as well as from the business employing two part time workers. Owner of the business organizations are Ken and Barb acquiring equal holding of shares whereas the trustee of the trust is KB Pty Limited. However, the beneficiaries of the trust were the owners, their children along with other relatives. As per the terms and conditions of the trust, taxable distribution of income to the beneficiaries were at 28% to Ken, 56% to Barb and the balance to the other relative during the year 2010-11. As per the taxation ruling under ITAA 97, loss on business from the trust is measured according to the loss determined under the capital gains. As per ITAA 97, section 36-10 loss on business income is computed by deducting the loss incurred by the trust and the balance income is taxable at the specified rate (Crawford 2016). Therefore, the income of the trust during the year 2010-11 amounted to $170,000 woul d be taxable in the books of trustee KB Limited at 45%. However, the deduction of 50% cannot be claimed since, the trustee of the discretionary trust is a company and not individual. Further, the income of trust during the financial year 2011-12 amounted 120,000 would have the same implication as the income taxed during 2010-11. Since the trustee did not make election as per section 272-80(1) in schedule 2F of ITAA 1936, therefore the income of the trust distributed to beneficiaries would be taxable in the hands of the trustee. Moreover, the tax loss amounted to $26,000 during the year 2012-13 whereas the amount of loss $34,000 during the year 2013-14 would be carry forward to the next succeeding year for set off from the income $80,000. Elections from family trust as per section 272-80 of schedule 2F, ITAA 1936 impose the trustee to deduct the tax losses incurred in the previous years as well as deduction of certain expenses and debts. As per the taxation ruling ITAA 97, income from the trust distributable to the beneficiaries is taxable in the hands of trustee as per the distribution proportion. On the contrary, loss incurred from the business is eligible for deduction from the income in the subsequent years. Therefore, in the present case if the trustee made an election under section 272- 80(1) in schedule 2F, ITAA 1936 then the income is taxable in the hands of the trustee based on the distribution proportion (Ward 2016). During the year 2010-11 income $170,000 would be taxable in the hands of KB Ltd at the rate of (28%+ 56%) = 84% whereas 61% of total income $120,000 during the year 2011-12. However, the business loss incurred during the year 2012-13 and 2013-14 amounted to $26,000 and $34,000 respectively shall be allowed for deduction in the next year 2014-15 from the total income $80,000. Whereas the balance income i.e. $20,000 ($80,000- $26,000+ $34,000) shall be taxable in the hands of trustee in proportion to the 54% since Ken and Barb are equal shareholders of the trustee company. Reference List Chua, H.S. and Bedford, O., 2015. A qualitative exploration of fear of failure and entrepreneurial intent in Singapore.Journal of Career Development, p.0894845315599255. Crawford, B.J., 2016. Valuation, Values, Norms: Proposals for Estate and Gift Tax Reform.Boston College Law Review,57. Doidge, C. and Dyck, A., 2015. Taxes and corporate policies: Evidence from a quasi natural experiment.The Journal of Finance,70(1), pp.45-89. Feisee, R.A. and Randall, R.L., 2015. Counseling Clients on Their IRA Beneficiary Designation Options: The Impact of the Recent US Supreme Court Case, Clark v. Rameker.Journal of Financial Service Professionals,69(1), pp.57-62. Feuer, A., 2016. Life Insurance and Retirement Plan Benefits: Are Your Clients Achieving Their Intended Goals?.NYSBA J,28. Harrison, L., 2015. Property investment through discretionary trusts.Taxation in Australia,50(2), p.84. Hoynes, H., Miller, D. and Simon, D., 2015. Income, the earned income tax credit, and infant health.American Economic Journal: Economic Policy,7(1), pp.172-211. Kousky, C. and Shabman, L., 2015. Understanding Flood Risk Decisionmaking: Implications for Flood Risk Communication Program Design.Resources for the Future Discussion Paper, pp.15-01. Neuman, S.S., Omer, T.C. and Thompson, A.M., 2015. Determinants and Consequences of Tax Service Provider Choice in the Not?for?Profit Sector.Contemporary Accounting Research,32(2), pp.703-735. O'Connor, D., 2016. Trusts: Practical solutions for real-life problems.Taxation in Australia,50(7), p.392. Tool, H.R., Williamson, J.E. and Whittenburg, G.E., 2015. Impact of Recent Tax Legislation on Small Business.Journal of Small Business Strategy,8(2), pp.79-91. Tucker, J., 2015. Tax files: Interpreting the land tax act.Bulletin (Law Society of South Australia),37(2), p.28. Ward, M., 2016. IRA Transfers from Estate or Trust.Journal of Financial Service Professionals,70(2), pp.38-41.

Working Capital Essay Example

Working Capital Essay Tw elfth Edition INTERNATIONAL BUSINESS Environments and Operations John D. Daniels University of Miami Lee H. Radebaugh Brigham Young University Daniel P. Sullivan University of Delaware Pearson Education International Contents Preface 29 About the Authors †¢ PART ONE 39 BACKGROUND FOR INTERNATIONAL BUSINESS 44 1 Globalization and International Business 45 49 44 CASE: The Global Playground Introduction 48 W h a t Is International Business7. The Forces Driving Globalization 50 Factors in Increased Globalization 51 Whats Wrong with Globalization? 56 Threats to National Sovereignty 56 Economic Growth and Environmental Stress 57 Growing Income Inequality 57 s | Point ^J3ffi^S^^3 Offshoring Good Strategy? 58 Why Companies Engage in InternationaLBusiness Expanding Sales 60 , Acquiring Resources 60 Minimizing Risk 60 60 Modes of Operations in International Business Merchandise Exports and Imports 62 Service Exports and Imports 62 Investments 63 Types of International Organizations 63 Why International Business Differs from Domestic Business 64 Physical and Social Factors 65 The Competitive Environment 67 Looking to the Future: 61 Three Ways of Looking at Globalization 68 C A S E : Carnival Cruise Lines: Exploiting a Sea of Global Opportunity 69 74 Summary Key Terms 75 Endnotes 75 An Atlas 78 Map Index 86 Contents †¢ 2 PART TWO COMPARATIVE ENVIRONMENTAL FRAMEWORKS 90 91 90 The Cultural Environments Facing Business 94 95 C A S E : The Java Lounge—Adjusting to Saudi Arabian Culture Introduction The People Factor Cultural Awareness 96 97 A Little Learning Goes a Long Way The Nation as a Point of Reference How Cultures Form and Change The Idea of a Nation: Delineating Cultures 98 99 98 Language as Both a Diffuser and Stabilizer of Culture 100 103 Does Geography Matter? We will write a custom essay sample on Working Capital specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Working Capital specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Working Capital specifically for you FOR ONLY $16.38 $13.9/page Hire Writer Where Birds of a Feather Flock Together Religion as a Cultural Stabilizer 104 Behavioral Practices Affecting Business 106 Issues in Social Stratification 106 Work Motivation 109 Relationship Preferences I II Risk-Taking Behavior I 12 Information and Task Processing I 13 Communications I 15 Dealing with Cultural Differences Accommodation I 18 118 Cultural Distance: Usefulness and Limitations I 19 Culture Shock 119 Company and Management Orientations 121 [ P o j n t B f f l J H ^ f f l Does International Business Lead to Cultural Imperialism? Strategies for Instituting Change 125 127 Looking to the Future: What Will Happen to National Cultures? C A S E : Charles Martin in Uganda: What to Do When a Manager Goes Native 128 123 Summary Key Terms Endnotes 132 133 133 3 The Political and Legal Environments Facing Business 137 136 C A S E : China—Legal Growing Pains in a Land of Opportunity Introduction 141 The Political Environment 142 143 Individualism Versus Collectivism Political Ideology 144 Trends in Political Systems 150 Contents Looking to the Future: What Might Become of Democracy? Political Risk 154 153 156 J | Point | g ^ | ^ ^ ^ j 3 Should Political Risk Management Be an Active Strategy? The Legal Environment 157 Legal Systems 158 Types of Legal Systems 158 The Diffusion of Legal Systems 159 Trends in Legal Systems 160 Understanding Bases of Rule 161 Implications for Managers 162 Legal Issues in International Business Operational Concerns 164 Strategic Concerns 166 Intellectual Property Rights 168 164 C A S E : Crime That Pays (and Pretty Well, Too) Summary Key Terms Endnotes 177 178 178 172 4 The Economic Environments Facing Businesses 184 186 180 181 C A S E : Economic Conundrums and the Comeback of Emerging Economies Introduction International Economic Analysis Elements of the Economic Environment Gross National Income 187 Features of an Economy 196 Inflation 196 197 199 Unemployment Debt 198 Income Distribution Poverty 200 Labor Costs Productivity 201 202 202 187 The Balance of Payments | Point |[emailprotected] §3^^fl Is a Trade Deficit an Advantage? Integrating Economic Analysis 206 Types of Economic Systems 206 Economic Freedom and Market Transitions Making the Transition to a Market Economy Looking to the Future: C A S E : Meet the BRICs Summary 222 204 209 21 I Is There a Move to Push Back Economic Freedom? 216 218 Contents Key Terms Endnotes 223 223 5 Globalization and Society 230 231 232 226 227 C A S E : Ecomagination and the Global Greening of GE Introduction Evaluating the Impact of FDI Considering the Logic of FDI The Economic Impact of the M N E 234 Balance-of-Payments Effects 234 Growth and Employment Effects 236 The Foundations of Ethical Behavior 237 Why Do Companies Care About Ethical Behavior? 237 The Cultural Foundations of Ethical Behavior 238 The Legal Foundations of Ethical Behavior 240 Ethics and Corporate Bribery 241 Corruption and Bribery 241 | Point | j E B 5 E ^ f f l Are Top Managers Responsible When Corruption Is Afoot? 44 Ethics and the Environment What Is Sustainability? Looking to the Future: 246 246 246 248 249 Global Warming and the Kyoto Protocol Ethical Dilemmas and Business Practices How to See the Trees in the Rain Forest Ethical Dilemmas and the Pharmaceutical Industry 249 Ethical Dimensions of Labor Conditions 251 Corporate Codes of Ethics: How Should a Company Behave? 254 C A S E : Anglo American PLC in South Africa: What Do You Do When Costs Reach Epidemic Proportions? 256 Summary Key Terms Endnotes †¢ 260 261 261 THEORIES AND INSTITUTIONS: TRADE AND INVESTMENT 264 PART THREE International Trade and Factor-Mobility Theory 268 264 265 C A S E : Costa Rica: Using Foreign Trade to Trade-Up Economically Introduction Laissez-Faire Versus Interventionist Approaches to Exports and Imports 269 Theories of Trade Patterns 269 Contents Interventionist Theories Mercantilism 270 Free Trade Theories 271 270 Theory of Absolute Advantage 272 Theory of Comparative Advantage 274 Theories of Specialization: Some Assumptions and Limitations 276 Trade Patterns Theories 278 279 284 How Much Does a Country Trade? 278 What Types of Products Does a Country Trade? With Whom Do Countries Trade? Does Geography Matter? The Statics and Dynamics of Trade Product Life Cycle (PLC) Theory The Porter Diamond 287 282 285 285 Variety Is the Spice of Life | Point |g^^^J35flfl Should Nations Use Strategic Trade Policies? 289 Factor-Mobility Theory 291 292 293 295 298 299 Why Production Factors Move Effects of Factor Movements Looking to the Future: Summary Key Terms Endnotes 302 304 304 The Relationship Between Trade and Factor Mobility C A S E : LUKOIL: Trade Strategy atja Privatized Exporter J In What Direction Will Trade Winds Blow? 7 Governmental Influence on Trade 06 C A S E : Making the Emperors (and Everyone Elses) New Clothes: Textile and Clothing Trade 307 Introduction 310 Conflicting Results of Trade Policies 311 The Role of Stakeholders 31 I Economic Rationales for Governmental Intervention Fighting Unemployment 312 Protecting Infant Industries 313 Developing an Industrial Base 314 Economic Relationships with Other Countries 316 Noneconomic Rati onales for Government Intervention Maintaining Essential Industries 319 Preventing Shipments to Unfriendly Countries 319 ^  § j t ^ ^ 3 Should Governments Forgo Trade Sanctions? Maintaining or Extending Spheres of Influence Preserving National Identity 321 321 311 319 320 10 Contents Instruments of Trade Control Tariffs 322 321 Nontariff Barriers: Direct Price Influences 323 Nontariff Barriers: Quantity Controls 325 Dealing with Governmental Trade Influences Tactics for Dealing with Import Competition Looking to the Future: 328 329 330 Dynamics and Complexity C A S E : U. S. -Cuban Trade: When Does a Cold War Strategy Become a Cold War Relic? 330 Summary Key Terms Endnotes 333 334 334 8 Cross-National Cooperation and Agreements 337 340 340 339 336 C A S E : Toyotas European Drive Introduction The World Trade Organization (WTO) GATT: The Predecessor to the W T O What Does the W T O Do? 341 The Rise of Bilateral Agreements 342 Regional Economic Integration 343 The Effects of Integration 344 Major Regional Trading Groups 345 The European Union 346 351 356 The NorthAmerican Free Trade Agreement (NAFTA) Regional Economic Integration in the Americas | Point U B I I H H B I Is CAFTA-DR a Good Idea? 359 Regional Economic Integration in Asia 360 Regional Economic Integration in Africa Looking to the Future: 362 Will the WTO Overcome Bilateral and Regional Integration Efforts? 63 Other Forms of International Cooperation 364 Commodity Agreements Consumers and Producers C A S E : Wal-Mart Goes South Summary 370 365 366 366 366 367 Commodities and the World Economy The Organization of Petroleum Exporting Countries (OPEC) Key Terms Endnotes 371 371 Contents 11 †¢ 9 PART FOUR WORLD FINANCIAL ENVIRONMENT 374 374 Global Foreign-Exchange Markets CASE: Going Down to the Wire in the Mon ey-Transfer Market Introduction 377 W h a t Is Foreign Exchange? 377 375 Players on the Foreign-Exchange Market Does Geography Matter? 378 378 382 Some Aspects of the Foreign-Exchange Market Major Foreign-Exchange Markets The Spot Market 383 The Forward Market 387 Options 388 Futures 388 383 Foreign-Exchange Trades The Foreign-Exchange Trading Process Banks and Exchanges Looking to the Future: 390 388 392 Where Are Foreign-Exchange Markets Headed? 394 How Companies Use Foreign Exchange 393 Business Purposes (I): Cash Flow Aspects of Imports and Exports Business Purposes (II): Other Financial Flows C A S E : Banking on Argentina Summary Key Terms Endnotes 402 403 404 398 395 396 | Point | { | j f l j ^ ; g f i 3 Is It Ok to Speculate on Currency? 0 The Determination of Exchange Rates C A S E : El Salvador Adopts the U. S. Dollar Introduction 409 407 406 The International Monetary Fund 410 Origin and Objectives 410 The IMF Today 410 Evolution to Floating Exchange Rates 41 I Exchange-Rate Arrangements Fixed Versus Flexible Currencies 412 414 416 Exchange Arrangements with No Separate Legal Tender Currency Board Arrangements 416 Co nventional Fixed-Peg Arrangements 416 416 Pegged Exchanges Rates Within Horizontal Bands More Flexible Arrangements 417 12 Contents Exchange Rates: The Bottom Line The Euro 419 417 421 ^3fflB Should Africa Develop a Common Currency? Determining Exchange Rates 423 Nonintervention: Currency in a Floating-Rate World 423 Intervention: Currency in a Fixed-Rate or Managed-Floating-Rate World The Role of Central Banks 424 Black Markets 428 Foreign-Exchange Convertibility and Controls 428 Exchange Rates and Purchasing Power Parity 429 Exchange Rates and Interest Rates 432 Other Factors in Exchange-Rate Determination 432 Forecasting Exchange-Rate Movements Fundamental and Technical Forecasting Factors to Monitor 435 433 433 436 24 Business Implications of Exchange-Rate Changes Marketing Decisions 436 Production Decisions 436 Financial Decisions 436 Looking to the Future: In Which Direction Is Exchange-Rate Flexibility Headed? 437 438 C A S E : The Chinese Yuan: Be Careful of the Dragons Tail Summary Key Terms Endnotes 442 443 444 †¢ PART FIVE GLOBAL STRATEGY, STRUCTURE, A N D IMPLEMENTATION 446 11 The Strategy of International Business CASE: Value Creation in the Global Apparel Industry Introduction 451 Industry, Strategy, and Firm Performance 452 446 47 Industry Organization Paradigm Leading Strategy Perspectives The Idea of Industry Structure: The Five-Forces Model 454 Industry Change 455 Strategy and Value 456 CreatingValue 457 The Firm as Value Chain 457 What Is the Value Chain? 458 Using the Value Chain 459 Change and the Value Chain 468 453 Contents 13 Are Value Chains Real? 469 470 Global Integration Versus Local Responsiveness Pressures for Global Integration 470 Pressures for Local Responsiveness 472 When Pressures Interact 473 Types of Strategy 474 474 475 477 479 481 International Strategy Multidomestic Strategy Global Strategy 476 Transnational Strategy Looking to the Future: Summary Key Terms Endnotes 484 485 485 Whats New in the World of Strategy Types? C A S E : The Globalization of eBay 12 Country Evaluation and Selection Introduction 493 494 494 494 488 489 C A S E : Carrefour: Finding Retail Space in All the Right Places How Does Scanning Work? Managing the Alternatives Scanning Versus Detailed Analysis Opportunities Risks 501 Does Geography Matter? 496 What Information Is Important in Scanning? 496 Dont Fool with Mother Nature 508 504 Collecting and Analyzing Data 507 Some Problems with Research Results and Data External Sources of Information Internally Generated Data | Point | g ^ ^ ^ ^ ^ 3 510 509 Should Companies Forgo Investment in Violent Areas? 51 I Country Comparison Tools Grids 512 Matrices 513 Allocating Among Locations 512 515 516 Alternative Gradual Commitments 515 Geographic Diversification Versus Concentration Reinvestment Versus Harvesting 518 Noncomparative Decision Making Looking to the Future: CASE: FDI in South Africa 521 519 520 Will Prime Locations Change? 14 Contents Summary Key Terms Endnotes 524 525 525 13 Export and Import Strategies Introduction 532 Exporting and Importing 528 529 C A S E : Grieve—A Small-Business Export Strategy 533 Export Strategy 534 Advantages to Consider 534 Questions to Ask 535 Strategic Advantages of Exporting 535 Characteristics of Exporters 536 Stages of Export Development 537 Pitfalls of Exporting 538 Designing an Export Strategy 539 Import Strategy 543 543 Types of Importers 543 Strategic Advantages of Imports The Import Process Import Brokers Customs Agencies 44 544 545 546 Looking to the Future: The Technology of Trade Import Documentation 548 The Export Process Indirect Selling Direct Selling 548 548 551 553 | Point | g ^ ^  § f l 8 ^ ^ A Dirty Dilemma: Exporting Hazardous Waste Export Documentation 554 Sources of Regulatory Assistance 556 Foreign Freight Forwarders 558 Countertrade Summary Key Terms Endnotes 559 561 C A S E : A Little Electronic Magic atAlibaba. com 564 565 565 14 Direct Investment and Collaborative Strategies C A S E : The Fizz Biz: Coca-Cola Introduction 572 569 568 Why Exporting May Not Be Feasible When Its Cheaper to Produce Abroad 573 574 Contents When Transportation Costs Too Much 575 When Domestic Capacity Isnt Enough 575 When Products and Services Need Altering 575 When Trade Restrictions Hinder Imports 576 When Country of Origin Becomes an Issue 576 Noncollaborative Foreign Equity Arrangements Taking Control: Foreign Direct Investment How to Make FDI 578 577 576 15 Why Companies Collaborate 579 Alliance Types 579 General Motives for Collaborative Arrangements 580 International Motives for Collaborative Arrangements 582 Types of Collaborative Arrangements 583 583 584 Some Considerations in Collaborative Arrangements Licensing 586 Franchising 587 Management Contracts 588 Turnkey Operations 589 JointVentures 590 Equity Alliances 591 Problems w i t h Collaborative Arrangements Relative Importance 592 Divergent Objectives 593 Questions of Control 593 , Comparative Contributions and Appropriations Culture Clashes 595 592 | Point j j f l j m ^ j ^ f f l Should Countries Limit Foreign Control of Key Industries? 594 Managing Foreign Arrangements Finding Compatible Partners Negotiating the Arrangement Drawing Up the Contract Assessing Performance Looking to the Future: Summary Key Terms Endnotes 603 604 605 95 596 597 598 Dynamics of Collaborative Arrangements 598 599 599 600 Why Innovation Breeds Collaboration C A S E : Getting Airline Alliances Off the Ground 15 The Organization of International Business C A S E : Organizing People. Values, and Environment at Johnson Johnson 609 608 Introduction 614 16 Contents Change: The Critical Factor Organization Structure 617 614 617 618 620 †¢a* Organizing Todays International Business Vertical Differentiation: Centralization Versus Decentralization Horizontal Differentiation: The Design of the Formal Structure Contemporary Structures 624 | Point IgEfl^^^Sffl Hierarchies or Hyperarchies? Coordination and Control Systems Coordination Systems 629 Control Systems 632 629 628 Organization Culture Challenges and Pitfalls Looking to the Future: Summary Key Terms Endnotes 644 645 645 635 635 638 639 640 637 The Importance of Culture Organization Culture and Strategy The Role and Rise of Corporate Universities C A S E : Infosys: The Search for the Best and the Brightest †¢ PART SIX MANAGING INTERNATIONAL OPERATIONS 648 649 648 16 Marketing Globally C A S E : Avon Calls on Foreign Markets Introduction 654 Marketing Strategies 655 657 Marketing Orientations 655 Segmenting and Targeting Markets Product Policies 659 659 Why Firms Alter Products []PoIrTtJ3BffiHEffl Should Home Governments Regulate Their Companies Marketing in Developing Countries? 660 Alteration Costs 663 The Product Line: Extent and Mix 664 Pricing Strategies 664 664 Potential Obstacles in International Pricing Promotion Strategies 669 The Push-Pull Mix 669 Some Problems in International Promotion 670 673 Branding Strategies 672 Worldwide Brand Versus Local Brands Contents 17 Distribution Strategies 674 675 Does Geography Matter? Is Necessity the Mother of Invention? Deciding Whether to Standardize 676 Choosing Distributors and Channels 676 The Challenge of Getting Distribution Hidden Costs in Distribution E-Commerce and the Internet 678 679 677 Managing the Marketing Mix Gap Analysis 680 Looking to the Future: 680 Marketing to the Haves, the Have-Nots (and the Have-Somes) 682 CASE: Tommy Hilfiger: Clothes Make the Man and Vice Versa Summary 686 Key Terms 687 Endnotes 687 683 17 Global Manufacturing and Supply Chain Management C A S E : Samsonites Global Supply Chain Introduction 694 695 What Is Supply Chain Management? 691 690 Global Manufacturing Strategies 696 696 Four Key Factors in Manufacturing Strategy Information Technology and Global Supply Chain Management Information Technology 701 Quality 703 Zero Defects Versus Acceptable Quality Level The Deming Approach to Quality Management Total Quality Management (TQM) 704 Six Sigma 705 Quality Standards 705 703 704 700 Supplier Networks Global Sourcing 707 708 709 710 710 Major Sourcing Configurations The Make or Buy Decision | Point | g f f l f l 3 ^ f f l Should Firms Outsource Innovation? Supplier Relations 712 The Purchasing Function 713 Inventory Management 15 715 Lean Manufacturing and Just-in-Time Systems Foreign Trade Zones 716 Transportation Networks 717 18 Contents Looking to the Future: Summary Key Terms Endnotes 724 724 725 Uncertainty and the Global Supply Chain 718 717 C A S E : Ventus and Business Process Outsourcing 18 International Accounting Issues C A S E : Parmalat: Europes Enron Introduction 733 729 728 The Crossroads of Accounting an d Finance 733 Accounting for International Differences Accounting Objectives 737 Factors in International Accounting Practices Cultural Differences in Accounting 739 Classifying Accounting Systems 741 36 738 International Standards and Global Convergence 744 748 | Point | «piffiffJHBfffil Should U. S. Companies Be Allowed to Close the GAAP? Transactions in Foreign Currencies Recording Transactions 749 749 750 Translating Foreign-Currency Financial Statements Translation Methods 750 Management Accounting Issues 753 756 Performance Evaluation and Control 753 Transfer Pricing and Performance Evaluation The Balanced Scorecard 757 Corporate Governance 758 759 External Control Mechanisms:The Legal System Internal Control Mechanisms 759 Looking to the Future: Will IFRS Become the Global Accounting Standard? 760 761 C A S E : Ericsson: The Challenges of Listing on Global Capital Markets and the Move to Adopt International Financial Reporting Standards Summary 766 Key Terms Endnotes 767 767 19 The Multinational Finance Function Introduction 774 770 771 C A S E : GPS: In the Market for an Effective Hedging Strategy? The Finance Function 774 The Role of the CFO 775 Contents 19 Capital Structure 776 776 Leveraging Debt Financing 776 Factors Affecting the Choice of Capital Structure Debt Markets as Means of Expansion 778 Global Capital Markets 778 778 781 Eurocurrencies and the Eurocurrency Market International Bonds 780 Equity Securities and the Euroequity Market The Size of Global Stock Markets 782 Offshore Financing and Offshore Financial Centers Whats an OFC? 784 Counterpoint 784 Should Offshore Financial Centers and Aggressive Tax Practices Be Eliminated? 786 Capital Budgeting in a Global Context 787 Methods of Capital Budgeting 788 Complications in Capital Budgeting 788 Internal Sources of Funds 789 Global Cash Management 790 Foreign-Exchange Risk Management 792 Types of Exposure 92 Exposure-Management Stratgey, 794 Taxation of Foreign-Source Income International Tax Practices 798 800 803 804 805 Taxing Branches and Subsidiaries Transfer Prices 803 Double Taxation and Tax Credit Looking to the Future: Summary Key Terms Endnotes 809 810 810 797 Technology and Cash Flows C A S E : Dell Mercosur: Getting Real in Brazil 20 Human Resource Management CASE: Go Or No Go: Your Career? 813 Introduction 8 17 What Is HRM? 817 The Strategic Function of International HRM Strategizing HRM 819 812 818 Developing Staffing Policies Managing Expatriates 826 Selecting Expatriates Expatriate Failure Training Expatriates 827 828 829 821 20 Contents Learning a Foreign Language—Still Useful? Compensating Expatriates Repatriating Expatriates International Labor Relations How Labor Looks at the MNE 832 836 839 ~840 842 83 I How Labor Responds to the MNE Looking to the Future: The Labor Struggle: Barriers to International Unanimity 843 Which Countries Will Have the Jobs of the Future? 845 Trends in MNE-Labor Relations 845 847 C A S E : Tel-Comm-Tek (TCT) Summary Key Terms Endnotes Glossary Photo Credits Name Index Subject Index 851 853 853 857 873 875 879 887 Company Index and Trademarks