Legal and Political Risks in International Business

This assignment examines the legal and political challenges faced by BHP Billiton, a multinational mining and metals corporation. It explores issues such as non-compliance with government sanctions and regulations, high regulatory instability risk in Australia, and civil disorder impacting employee safety. The assignment proposes solutions for mitigating these risks, including adhering to United Nations Security Council guidelines, utilizing resources from the Department of Foreign Affairs and Trade (DFAT), and seeking assistance from Export Finance and Insurance Corporation (EFIC).

International Business
Management

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
REFERENCES................................................................................................................................2

INTRODUCTION
International business entities are more likely to have political and legal issues. In order
to understand these problems the selected organisation is BHP Billiton, a diversified metals'
global trade player Fooks & Gilmore (2014)
MAIN BODY
The legal problems that are being faced by the entity are due to the poor compliance with
the government sanctions and regulations. It is necessary for them to be aware of United Nations
Security Council countenance and bilateral visage Nonet, (2017). In addition to this, organisation
needs to maintain the rules when competing with other similar entities Boubakri, Mansi & Saffar,
(2013) Whereas the political issues that are impacting the business value is the high regulatory
instability risk in Australia. Furthermore, civil disorders are affecting personal security of BHP
Billiton's employees.
The legal issues can be resolved using numerous factors such as defining all the rules
before implementing a single operation, limiting agreement to the contract, explaining clauses of
payment and getting out of disputes. However, the major legal risk can be resolved by following
all the legal sanctions as stated in United Nations Security Council Head, (2014). This visage
covers teh laws for export/import, technical assistance, travel laws and financial sanctions.
Besides this, the political risk of high instability can be managed by taking help from the
Department of Foreign Affairs and Trade(DFAT) which monitors all the effects of political
changes of entire business groups of Australia (Australian Government, 2017). Further, EFIC can
also assists in recovering from the losses that causes due to regulatory instability.
1

REFERENCES
Boos and Journals
Boubakri, N., Mansi, S. A., & Saffar, W. (2013). Political institutions, connectedness, and
corporate risk-taking. Journal of International Business Studies. 44(3). 195-215.
Fooks, G., & Gilmore, A. B. (2014). International trade law, plain packaging and tobacco
industry political activity: the Trans-Pacific Partnership. Tobacco control. 23(1). e1-e1.
Head, B. W. (2014). Evidence, uncertainty, and wicked problems in climate change decision
making in Australia. Environment and Planning C: Government and Policy. 32(4). 663-
679.
Nonet, P. (2017). Law and society in transition: Toward responsive law. Routledge.
Online
Australian Government, 2017. [Online]. Available through
<https://www.austrade.gov.au/Australian/Export/Guide-to-exporting/Risk-
management>. Accessed On 22nd August, 2017
2