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Scope of International Business Law

International business law governs the activities of multinational enterprises operating across borders. These activities include exports and imports as well as foreign direct investment. Exports involve selling goods and services produced domestically to foreign customers, while imports involve purchasing goods from foreign sellers. Foreign direct investment occurs when a multinational enterprise invests in production facilities or acquires companies in another country. Foreign direct investment is classified as either inward, involving investment in a country's local resources, or outward, involving a government protecting domestic investors investing abroad from risks.

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83 views2 pages

Scope of International Business Law

International business law governs the activities of multinational enterprises operating across borders. These activities include exports and imports as well as foreign direct investment. Exports involve selling goods and services produced domestically to foreign customers, while imports involve purchasing goods from foreign sellers. Foreign direct investment occurs when a multinational enterprise invests in production facilities or acquires companies in another country. Foreign direct investment is classified as either inward, involving investment in a country's local resources, or outward, involving a government protecting domestic investors investing abroad from risks.

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Vrk
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Scope of International business law:

1: The scope of International Business


Going global is the Mantra of today‟s economy. In the game of
globalization, Multinational Enterprises are those actors who
perform their task with full of their efficiency. Most of the
Multinational Enterprises perform different activities
International Business

and operations in other nations. These activities are generally


assorted in two categories:-
i. Exports and imports
ii. Foreign Direct Investments
(i) Exports and imports:- The meaning of export inferred from
the term shipment of goods and services out of the nation.
This transaction must be legitimate and fulfill all the
requirements of different laws. In the other words it is a task
to provide goods and services to foreign
customers/consumers by the domestic
manufacturers/traders.
On the other hand import is an activity where a domestic
buyer gets goods from the seller who is not trading in that
domestic economy. In this activity international products and
services are availed by the domestic users.
To reduce the fall off in any economy, both export and
import must be balanced. These two are major driving forces
of any economy. Countries like China reached at its high
economic conditions just because of its exports in different
nations. This all could take place due to International
Business.

(ii) Foreign Direct Investment:- In the very general sense


Foreign Direct Investment is an act to do investments in
other countries by any Multinational Enterprise. There can
be various ways to do this investment such as- investments
in the process of productions, acquiring an organization in
target nation, by acquiring shares etc.
Foreign Direct Investment is a major tool for any nation to
inflow international capital. It also enhances technical
advancements and job opportunities in different streams.

Foreign Direct Investment can be further classified in two types:-


a. Inward foreign direct investment- It is an investment
where Multinational Enterprises invest foreign capital in
different local resources.
b. Outward foreign direct investment- It is a protective mode
by the government where government protects investors from
all associated risks.

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