International Business Law

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International Business Law

International Business Law


Current international law recognizes that preventing or punishing third party interference with the enjoyment of human rights and providing remedies to victims are a part of the state's duty to protect human rights. Unfortunately, though failure to take necessary steps to fulfill this duty may amount to a failure of the state to comply with its treaty obligation, effective sanction at the international level to deter noncompliance is still absent. As a result, states take different approaches and standards in providing access to remedy for victims. One of the most important means to seek remedy is through judicial mechanism.

The role of the judiciary to provide remedy for victims of corporate wrongdoing is crucial. The Committee on Economic, Social and Cultural Rights has strongly stressed that the enjoyment of some human rights cannot be made fully effective without the role of the judiciary. This is true because the judicial mechanism is not only capable of resolving allegations of human rights violation and of issuing judgment, but it is a mechanism through which an enforceable award of compensation can be secured. In particular, the judicial mechanism is the only device capable of granting specific redresses for different plaintiffs. Koh (1991) states that, plaintiffs in human rights cases may pursue two different goals. First, the tort plaintiff seeks compensation, deterrence, and denial of safe haven to the defendant'. Second, the institutional reform plaintiff aims at government policy reform.

Foreign Direct Investment

Foreign direct investment (FDI) plays an extraordinary and growing role in global business. It can provide a firm with new markets and marketing channels, cheaper production facilities, access to new technology, products, skills and financing. For a host country or the foreign firm which receives the investment, it can provide a source of new technologies, capital, processes, products, organizational technologies and management skills, and as such can provide a strong impetus to economic development.

Most governments now offer incentives and benefits to those companies that choose their country as a place to set up operations. These range from support services to investors, cheap labor, protection of property to tax exemptions.

Foreign direct investment involves a significant degree of influence by the investor on the management of the enterprise resident in another country. This investment relates to both the initial transaction between the two entities and all subsequent transactions between these entities and their foreign affiliates, both incorporated in capital companies or not.

In some cases, foreign investment extends beyond the enterprise; the advantages offered to foreign investment allow political control over society with great inequality. In these cases local elites are associated with foreign elites to maintain their privileges inmates. The latter cede control of strategic resources. Profits of foreign investment are mainly exported or retained in luxury consumption of local elites, but also result in military expenditures would contain a social explosion.


Given the central role of the judicial mechanism at the national level, examining the use of transnational litigation by victims of corporate human rights abuses is ...
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