The increased foreign availability of high-tech products
The speed of change and the rapid dissemination of information and innovation around the world
The issue of equipment size
Implementation and Enforcement of Export Controls
Export controls are increasingly difficult to implement and enforce.
The number of countries that are able to manufacture products of strategic importance has increased.
Products that are in need of control are developed and disseminated very quickly.
It is difficult to control the transfer of technology and know-how.
Regulation of International Business Behavior
Regulations on firms varies substantially among nations.
Nations may employ boycotts to govern business activities.
Antitrust Laws are a regulatory activity.
Bribery
Firms operating abroad are affected by laws against bribery and corruption.
International businesses may bribe to counterbalance poor product quality, to create a market for goods, or to stay competitive with other firms that bribe.
Host Country
Political Action and Risk
Varies widely from country to country
Economic Risk
Less dangerous, but more common
Three Types of Political Risk
Ownership Risk
Exposes property and life
Operating Risk
Interference with the ongoing operations of a firm
Transfer Risk
Limitations on the outflow of funds
Political Risk May Involve
Confiscation
The government takeover of a firm without compensation to the owners.
Expropriation
A form of government takeover in which the firm’s owners are compensated.
Domestication
The government demands transfer of ownership and management responsibility.
