If you are currently operating an International Business or are considering starting one, you should be aware of the major legal principles that fall under International Business Law. There are three main legal principles that are recognized in much of international law. These are not actually required but are based primarily on courtesy and respect. The three main principles are: the Principal of Comity, the Act of State Doctrine and the Doctrine of Sovereign Immunity. Each one of these is described as follows.
PRINCIPLE OF COMITY
The term comity means legal reciprocity. This means that various jurisdictions will extend courtesies to other jurisdictions in other nations or different jurisdictions within the same nation.
In the instance where two nations share common public policy ideas, one nation or jurisdiction will submit to the laws and judicial decrees of the other. They agree to recognize the legally binding decisions of the other nation’s executive, legislative, and judicial branches of government.
Comity is a courtesy and a show of respect to the other jurisdictions in which you agree with the decisions and laws set forth by other courts. Comity is an essential part of international business.
ACT OF STATE DOCTRINE
The Act of State Doctrine simply means that every sovereign state is entitled to the respect of every other sovereign state. Each state is independent and courts do not have the right to sit in judgment on the acts of others in government done within their own territory. All nations are sovereign in their own territory and therefore, any official actions that occur there may not be questioned by the judicial bodies of another country. This is extremely important because it dissuades courts that are outside of the jurisdiction from deciding cases that would interfere with the country’s foreign policy. This policy has been questioned several times by the United States Supreme Court in various cases. Although, the Act of State Doctrine is not required in international law, it is acknowledged and followed by the United States Federal Courts.
DOCTRINE OF SOVEREIGN IMMUNITY
Sovereign immunity is a legal doctrine. It protects the rights of each sovereign state against both civil and criminal prosecution. No sovereign state can commit a wrong and is immune from prosecution.
In international law sovereign immunity deals with the actions brought to the courts of one nation against another foreign nation. It prevents the sovereign state from being tried in the court without its permission.
In the United States this act is governed by the Foreign Sovereign Immunities Act of 1976. This act establishes the specific procedures required to serve process, attach property in a foreign nation and to the execution of judgment in any proceedings involving a foreign nation. This act contains the legal basis to bring a lawsuit against a foreign sovereign. It was signed into law by former President Gerald Ford on October 21, 1976. Due to the numerous legal issues that have arisen out of this act, the American Bar Association has formed a working group in an attempt to reform the act.
International Business Law is a very complex area of the law. Any time in which multiple jurisdictions in foreign nations are involved the legal issues involved became complicated. The highly qualified international business professionals at Gonzalo Law LLC are available to help you with any of the multifaceted legal issues that may arise while conducting international business.
DISCLAIMER: The information contained herein is not intended to be specific legal advice for your particular situation. It is meant to provide general information on the changing landscape of the law. You are encouraged to contact legal counsel for legal advice specific to your particular legal situation.