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Evidence 7: Compliance with foreign law

Presented by:

Daniela Cárdenas Rubiano

José Gabriel Saldarriaga Villadiego

Herlein A. Chanci López

Instructor:

Carlos Andrés Jiménez

Instituto Nacional de Aprendizaje (SENA)

Tecnólogo en Negocios Internacionales Ficha 2193547

2021
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Evidence 7: Compliance with Foreign Law

Vocabulary

❖ Legislation: Set of laws by which a State or a specific activity is regulated.

Legislación: Conjunto de leyes por las que se regula un Estado o una actividad

específica.

❖ Profitability: Relationship between the benefits provided by a certain operation or

thing and the investment or effort that has been made; when it comes to financial

performance; it is usually expressed in percentages.

Rentabilidad: Relación entre los beneficios que brinda una determinada operación o

cosa y la inversión o esfuerzo que se ha realizado; cuando se trata de desempeño

financiero; generalmente se expresa en porcentajes.

❖ Prohibition: A ban that is imposed to do, use or touch something and that is based on a

norm, law or social consensus.

Prohibición: Veto que se impone para hacer, usar o tocar algo y que se apoya en una

norma, ley o consenso social.

❖ Garnishment: is a mandatory enforcement measure designed to identify enough assets

of the debtor's estate to provide an amount of money to the creditor.

Embargo: es una medida de ejecución obligatoria diseñada para identificar suficientes

bienes del patrimonio del deudor para proporcionar una cantidad de dinero al

acreedor.

❖ Fine: Penalty that consists of paying an amount of money, imposed for having broken a

law or having committed certain misdemeanors or crimes.

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Multa: Sanción que consiste en pagar una cantidad de dinero, impuesta por haber

infringido una ley o haber cometido determinadas faltas o delitos.

❖ Certification: It is a conformity assessment process, which allows to produce a written

report in relation to a product, a person or organization, ensuring that it meets certain

requirements.

Certificación: Es un proceso de evaluación de la conformidad, que permite producir un

informe escrito en relación a un producto, una persona u organización, asegurando que

cumple con ciertos requisitos.

❖ Taxes: The tax is a tribute or charge that people are obliged to pay to an organization

(government, king, etc.) without there being a direct consideration. This is, without a

direct benefit being delivered or assured for its payment.

Impuestos: El impuesto es un tributo o cargo que las personas están obligadas a pagar

a una organización (gobierno, rey, etc.) sin que exista una contraprestación directa.

Esto es, sin que se entregue o asegure un beneficio directo para su pago.

❖ Tariff: The tariff is a tribute that is imposed on a good or service when it crosses the

border of a country.

Arancel: El arancel es un tributo que se impone sobre un bien o servicio cuando cruza

la frontera de un país.

❖ Import: In economics, imports are the transport of goods and services from abroad,

which are acquired by a country to distribute them within it.

Importación: En economía, las importaciones son el transporte de bienes y servicios

del extranjero, los cuales son adquiridos por un país para distribuirlos en el interior de

este.
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❖ Export: In economics, an export is any good or service sent outside the national

territory. Exports are the set of goods and services sold by a country in foreign territory

for their use.

Exportación: En economía, una exportación es cualquier bien o servicio enviado fuera

del territorio nacional. Las exportaciones son el conjunto de bienes y servicios vendidos

por un país en territorio extranjero para su uso.

Summary

Compliance with foreign law

Before exporting to a foreign country, it is important to know the foreign laws that may affect

the sale. Also, this information should be obtained from reliable sources. Incorrect information on

foreign legislation may result in a ban on the importation of exporter's product, or it may mean

that the customer cannot resell the product profitably as expected. Some specific examples are as

follows:

Industry standards: One type of foreign safety standard that is gaining importance is the "CE"

mark required for the importation of certain products into the European Community: toys, simple

pressure vessels and telecommunications terminal equipment, machinery, appliances. gas,

electromagnetic compatibility, low voltage products and medical devices. Products that do not

conform to these directives are subject to seizure and evaluation for purposes. However, for some

products, the manufacturer must (and in all cases can choose) to engage an authorized

independent certification services company to perform the conformity assessment. The

manufacturer must maintain a technical construction file to support the statement and must have

an authorized representative located within the European Community. ISO 9000 quality standards

are increasingly important for European sales.

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Foreign customs laws: Export destination countries may have absolute quotas on the quantity

of products that can be imported. Import of excess products the quota will be prohibited.

Similarly, it is important to identify the amount of customs duties that will be assessed on the

product, which will imply determine the correct tariff classification for the product under foreign

law in to determine whether the tariff rate will be so high that it is unlikely that product sales will

be successful in that country and assess whether a distributor will be able to make a reasonable

profit if he resells to the current market price in that country. Some countries, do not fully adhere

to the GATT Valuation Code and may impose tariffs on fair market value instead of the invoice

price. Many countries impose severe penalties for import violations; This will generally take some

period of time, and the seller and buyer may have to adjust their production plans and delivery

accordingly.

Government contracting: Commissions may be prohibited or commission disclosure it may be

necessary to pay. Government purchases may qualify for customs duties, import license quotas or

exemptions. Barter or countertrade can be necessary.

Buy American Equivalent: Laws Foreign government agencies often enact regulations that are

designed to give preferential treatment to products supplied by manufacturers in their own

country.

Exchange controls and import licenses: Unlike the United States, many nations of the world

have exchange controls. Systems designed to limit the amount of your currency that can be used

to buy foreign products.

Value added taxes: Many countries impose a value added tax at the stages of production and

distribution. These taxes are generally applied to imported goods, so that the importer, in addition
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to paying customs duties, you must pay a value-added tax based on, generally on customs value

plus duties. When the importer marks and resell the merchandise, collect the tax from the buyer,

who must remit to the tax authorities after receiving a credit for import taxes.

Specialized laws: Foreign countries often enact specialized laws that prohibit the importation

of certain products except in compliance with those laws. In any case, like the United States,

foreign countries often have special laws that affect certain products or classes of products, and

the existence of such regulation must be verified before to manufacture, before entering into a

sales agreement, and even before Quoting prices or delivery dates to a customer. (Johnson and

bade, 2010) 1

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