Submitted by: Submitted by maquil
Views: 101
Words: 901
Pages: 4
Category: Business and Industry
Date Submitted: 10/05/2014 03:43 PM
Chinese companies court disaster; doing business in America means also learning how to navigate the U.S. legal system
1) Which THREE knowledge concepts, ideas or issues do you think are the most important and why?
After reading the article by the Walls Street Journal, three important concepts resonated with me. First, it is important to understand the legal system of a foreign country. It is very easy thing to say, but difficult concept to follow. Many companies that operate abroad are focus towards market penetration through business platform and tend to marginalize the importance of understanding legal system of the foreign country. Main reason could be expense. Any legal consultation comes a with hefty price tag and companies would view this as an unnecessary expenses for a start up. Also it is important to view this for an eastern perspective, where legal system is not very strict and enclose many loopholes. Nonetheless, understanding the legal system is critical for the companies’ future success especially in North America, where laws are enforceable. I recently came across a Wall Street Journal article where the US government commission warned American investors of the high risk investment, if they buy shares in Chinese companies like e-commerce firm Alibaba Group Holding Ltd due to the company’s’ complex and highly risky scheme of legal arrangements. (Wall Street Journal, 2014). This is another example of foreign company, which has fail to comply with Americans legal standards, which potentially could lead in nasty lawsuits.
The second important concept in the article is the meaning of lawyers. Foreign companies tend to have generic understanding of lawyers and what they do. It is interesting to read that companies would hire lawyers when damages are already made. Lawyers are more than just legal representative but they can also help reduce cost and risk through consulting and risk assessments. According to the author, Chinese companies view lawyers...