The risks faced by a company conducting business in the international market with operations in multiple regions pertain to risks of political uncertainty in the international market as well as the risks relating to culture clash and legislation and laws of the countries in the international market. However, “for corporations intent on developing an effective worldwide strategy, ultimate success may hinge on the company’s mastery of the legal environment.” (Pincus & Belohlav, 1996)
The jurisdiction for dealing with the legal issues of the international is dependent on the nature of the business. If the business is present or located in the home country and only provides products and services to the international market then the business is liable to report to the local trade associations and authorities like the US Department of Commerce. However if the country has operations in foreign countries as well then the business has to report to the regional authorities as well as the authorities like the US department of commerce and the International Trade Administration in case presence of conflicting legal issues. “The U.S. Securities Act of 1933 and the Securities and Exchange Act of 1934 provide a comprehensive structure for controlling security trades.U.S.companies that become multinational enterprises must make full disclosure of all material facts to investors through filings with the Securities and Exchange Commission. Failure to do so may result in financial penalties. For a geographically dispersed company, identifying and communicating relevant knowledge of all material matters is a complex task.” (Pincus & Belohlav, 1996)
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