INTERNATIONAL BUSINESS – LAWS AND PRACTICES

1 ISTUDY MATERIALPROFESSIONAL PROGRAMMEINTERNATIONALBUSINESS LAWSANDPRACTICESMODULE 3 ELECTIVE PAPER 9-5 ICSI House, 22, Institutional Area, Lodi Road, New Delhi 110 003tel 011-4534 1000, 4150 4444fax +91-11-2462 6727email THE INSTITUTE OF COMPANY SECRETARIES OF INDIATIMING OF HEADQUARTERSM onday to FridayOffice Timings to Dealing TimingsWithout financial transactions to financial transactions to , Typesetting by AArushi Graphics, Prashant Vihar, New Delhi, andPrinted at Tan Prints/July 2014iiiiiINTERNATIONAL BUSINESS - laws AND PRACTICEST oday globalization has dramatically re-shaped the markets and has changed the way BUSINESS is being has to keep pace with the customer s requirement and has to bring in services and products as per globalstandards.

2 INTERNATIONAL trade has become a vital component of development strategy, which can be used as aneffective instrument of economic growth. Moreover the establishment of institutions like World Trade Organisationhas ushered a new era of global economic co-operation reflecting the widespread desire to operate in a moreopen multilateral trading system. Participation in INTERNATIONAL trade has become necessity for all countries andas well as companies for it becomes important for professionals to acquire knowledge and skill to help work in INTERNATIONAL companiesand in global environment. Having updated knowledge of INTERNATIONAL BUSINESS laws and procedures becomeskey requisite for professionals.

3 So, in this study broad aspects related to INTERNATIONAL BUSINESS environment,export management, FDI policy, FTP policy, INTERNATIONAL trade theories, INTERNATIONAL trade bodies like WTO,UNCTAD, INTERNATIONAL logistics and supply chain etc. has been discussed in detail. Added emphasis has beenlaid on strategic alliances, foreign collaborations and joint ventures abroad, to enable the students to dischargeefficient services and to tackle practical this study every efforts has been made to give a comprehensive coverage of all the topics relevant to thesubject. At the end of each study lesson a brief about the lesson have been given under the caption LessonRound Up as well as questions have been given under the caption Self Test Questions for the practice ofstudents to test their study material has been published to aid the students in preparing for theINTERNATIONAL BUSINESS laws AND PRACTICES paper of the CS Professional Programme.

4 It is part of the education kit and takes thestudents step by step through each phase of preparation stressing key concepts, pointers and Secretaryship being a professional course, the examination standards are set very high, with emphasison knowledge of concepts, applications, procedures and case laws , for which sole reliance on the contents ofthis study material may not be , in order to supplement the information/contents given in the study material, students are advised torefer to the Suggested Readings mentioned in the study material, Student Company Secretary, BUSINESS Dailiesand the event of any doubt, students may write to the Directorate of Academics in the Institute for clarification due care has been taken in publishing this study material yet the possibility of errors, omissions and/or discrepancies cannot be ruled out.

5 This publication is released with an understanding that the Institute shallnot be responsible for any errors, omissions and/or discrepancies or any action taken in that there be any discrepancy, error or omission noted in the study material, the Institute shall be obliged ifthe same are brought to its notice for issue of the corrigendum in the e-bulletin Student Company is open book examination for this Elective Subject of Professional Programme. This is to inculcate anddevelop skills of creative thinking, problem solving and decision making amongst students of its professionalprogramme and to assess their analytical ability, real understanding of facts and concepts and mastery to apply,rather than to simply recall, replicate and reproduce concepts and principles in the 9-5 : INTERNATIONAL BUSINESS - laws AND PRACTICESL evel of Knowledge: Expert KnowledgeObjective.

6 To acquire specialized knowledge in INTERNATIONAL BUSINESS , law, procedure and INTERNATIONAL BUSINESS - Nature and Scope, Globalization - Meaning, Levels, Merits, Limitations and irreversibility of Globalization Need to go global Internationalization Decisions (entry modes) SEZ BUSINESS Environment Meaning of Environment Dimensions - PEST to STEEPLE Internal Environment and External Environment SWOT Analysis Various approaches to Assess competitiveness including MichaelPorter s 5- Forces Model Global Competitiveness National Enterprises (MNEs) and Foreign Direct Investment (FDI) Meaning and Characteristics Role of MNEs in host economy Trends in Global FDI Trends in FDI with reference to India Issues with MNEs - Taxation, Restrictive Trade PRACTICES ,Currency.

7 Jurisdiction and Technology Trade Policy and Procedures introduction to Foreign Trade Policy Institutional Framework for Export Promotion Export Incentives and Facilities EPZ/FTZ/100% EOUs Quality Control for Exports Export Prospects for Select Products and Services INCO Termsv INTERNATIONAL Commercial Arbitration-Shipment and Post Shipment Finance SEZ-Incentives and Benefits Method of Realizing Export Payments and Ensuring Guaranteed Export Payment Central Excise Clearance Formalities Customs Regulations and Clearance Formalities for Exports & Imports Duty Draw Back Claims Procedure Foreign Trade Financing - Export & Import Foreign Exchange Risk Management INTERNATIONAL Credit Management Warehousing Instruments of Trade Policy and India s Trade Trade and Regional Economic Integration Theory - Mercantilism, absolute advantage and comparative advantage Trends in Global Trade Trends in India s Trade Types of Regional Economic Integration - Free Trade Area,Custom Union, Common Market, EconomicUnion, Monitory Union and Political Union etc.

8 Trading Blocks- ASEAN,SAFTA,SAARC,NAFTA, Environment Pre WTO Scenario, difference between GATT and WTO Trade Related Institutions - WTO and UNCTAD WTO - Basic Principles, various agreements, Functions and Areas of Operations, Dispute SettlementMechanism (rules and procedures) IMF, IBRD, ADB Commodity Duties WTO Provisions on Anti-Dumping-, Anti-Dumping Duties, Procedure and Developments Regulatory Framework for Anti Dumping in India Recent Anti Dumping Cases in and Countervailing Duties WTO Provisions Administration Procedure and Emerging Trends Regulatory Framework for Subsidies & Countervailing duties in India Doha Development Collaborations and Joint Ventures Foreign Direct Investment Policy, Industrial Policy Kinds of Collaboration and Joint Ventures Drafting of Agreement Restrictive Clauses in the Foreign Collaboration/Joint Venture Agreements INTERNATIONAL Commercial Alliances Meaning, Rationale, Types.

9 Trends in Alliances in NewCompetitive Environment, Strategic AllianceFailures, ManagingStrategic Management Logistics Framework- Concept, Objective and Scope Transportation, Warehousing, Inventory Management, Packingand Unitization, Control andCommunication Role of IT in Logistics, Logistics Service Firms andThird Party LogisticsviiLIST OF RECOMMENDED BOOKSMODULE 3 ELECTIVEPAPER 9-5 : INTERNATIONAL BUSINESS - laws AND PRACTICESThe students may refer to the given books and websites for further knowledge and study of the subject :Books : INTERNATIONAL Trade and Export Management by Francis Cherunilam , Himalaya publishing House INTERNATIONAL BUSINESS by K Awasthappa, Mc Graw Hill Foreign Trade Policy and Handbook of Procedures by (17th Edition 2012) Anti Dumping Law and Procedures by (4th Edition 2013) INTERNATIONAL BUSINESS Justin Paul, PHI Publications A Guide to Export-Import Consultancy & Registration Services , Paper Bac Export Management, , Paper BackWebsites.

10 BUSINESS - laws AND PRACTICESLESSON 1 introduction TO INTERNATIONAL BUSINESSB usiness2 INTERNATIONAL Business2 Drivers of INTERNATIONAL Business2 Benefits of INTERNATIONAL Business4 Scope of INTERNATIONAL Business5 Difference between Domestic and INTERNATIONAL Business5 Globalisation8 Benefits of Globalisation9 Criticisms of Globalisation10 Myths about Globalization10 Stages of Globalisation11 Risks in Global Business13 Issues in Global Business13 Globalisation and INTERNATIONAL Trade14 Globalisation and Financial Markets15 Globalization, Income Inequality and Poverty15 Globalisation and Strategic Management16 The Future of Globalization18 India and Globalisation18 Needs to go Global22 From an individual company s viewpoint22 From the governments viewpoint23 Modes of Entry and Operation in INTERNATIONAL Business24 Exporting25 Licensing25 Franchising26 Special Modes28 Foreign Direct Investment without Alliances29 Foreign Direct Investment with Strategic Alliances30ixPageLESSON ROUND UP30 SELF TEST QUESTIONS31 LESSON 2 INTERNATIONAL BUSINESS ENVIRONMENTC oncept of INTERNATIONAL BUSINESS Environment34 Internal and external environment34 Economic Environment36 Technological Environment39