Legal Aspects of International Trade

This report analyzes the legal aspects of international trade and enterprise, focusing on the Australian multinational company BHP Billiton. It examines the legislative regulatory framework affecting the company's operations, including environmental protection, electricity regulation, and greenhouse gas reporting. The report also explores the impact of bilateral and multilateral treaties on the company's provision of products and services in the global market.

Legal Aspects of International
Trade and Enterprise

Table of Contents
EXECUTIVE SUMMARY.............................................................................................................1
QUESTIONS...................................................................................................................................1
1 BHP Billiton in brief detail.......................................................................................................1
2 Legislative regulatory framework affecting the company........................................................1
3 Different treaties, agreements and conventions which affects and impacts the provision of
the products and services of the company...................................................................................4
REFERENCES................................................................................................................................7

EXECUTIVE SUMMARY
The legal aspects are the laws which may affect the company's operation and
management either positively or may be negatively. Firstly the report outlined the detail of the
Australian multinational company that is BHT Billiton in brief. Further the report discussed
some laws which are applicable on the company's operations and working. Lastly the report
highlighted the treaties that is the bilateral and the multilateral treaty.
QUESTIONS
1 BHP Billiton in brief detail
The Australian multinational company BHP Billiton is an Anglo- Australian company
which deals in the business of petroleum, mining and metals and is a type of dual listed public
company. The company was founded in 2001 by the merger of the Australian Broken Hill
Proprietary Company Limited (BHP) with the company named Anglo- Dutch Billiton Plc which
forms a dual listed company and is headquartered in Melbourne, Australia. The products of the
company are coal, petroleum, iron ore, natural gas, uranium, nickel and many more. The
company deals in mining industry and this industry is a primary, significant industry and is also a
great contributor of the Australian economy. Many types of minerals, metals and ores have been
mined throughout the whole country. The company has approximately 100,000 number of all
over the countries out of which 62,000 of business in Australia. The company is globally situated
in around 26 countries like Japan, China, India, Manila, Philippines, United Kingdom, Colombia,
Singapore and many more countries. According to Lester, Mercurio and Davies, 2018, the
policies of the company works in direction of encouraging openness, mutual understanding,
trust, promoting team work and team spirit and coordination among the employees, diversifying
inter- personal relationships which are beneficial for the company in creating a competitive
advantage over the competitors to stand and face the cut- throat competition in the market.
2 Legislative regulatory framework affecting the company
The legislative regulatory framework includes all the regulations, rules and regulations,
acts, procedures and policies which are mandatory to be followed by the company for
successfully operating and conducting its business. These laws and regulations have been made
due to the reason that the laws make sure that the organization and all the employees and the
individual must abide by the law to meet the minimum standards which the company needs to
1

achieve in order to survive. The different types of the legal framework affecting and impacting
the BHP Billiton is as follows-
 Environment protection (sea dumping) act, 1981- it is an act designed and
implemented in order to protect the environment by channelizing and regulating the
dumping of the waste and by- products into the sea. Also, protecting the sea from
artificial reef placements and incineration at the sea. This act is applicable to all types of
platforms, aircraft & vessels which are allowed in the Australian waters and also to all
other Australian vessels and aircraft in any part of the sea other than Australia at any
place other than Australia. It also involves transferring the material and stuffs, work in
progress and products by shipping vehicles through the Australian seaway. The BHP
Billiton needs to take special permission to dump or destroy any controlled material into
the Australian waters from any aircraft or platform or the vessel.
 National electricity law and rules- it is an act designed to provide assistance in the
operations of a national electricity market (Besson and d'Aspremont, 2017). It involves
operating and constructing the gas- fired power plant, co generation plant and additional
electricity transmission line and many other electrical structure like substation, cabling,
transformers etc. The administering agency or body is the Department for Transport,
Energy and infrastructure (South Australia). If the company needs to operate, have
control and wants to own the proposed electricity transmission system and the generation
plant then it needs to be a registered participant.
 National greenhouse and energy reporting act, 2007- it is an act to establish the
national framework for all the Australian corporation which reports the reductions,
removals and offsets, green house gas emission and energy consumption and production.
The national green house and energy reporting scheme was introduced in the year 2007
by the Australian government in order to provide accounting and data in context of the
green house gas emission and the energy consumption and production of large
corporations. It is governed and administered by the Australian Government department
of the climate change. The existing operations of the company reports the quantity and
also the projected increase and this will result in an addition in the discharge of the green
house gases above the trigger level. According to this law the company is required to
2

report its all the green house gas which has been emitted as well as all the energy
produced and consumed by the company.
 Environment protection act, 1993- it is a collection of law which is applicable in the
Australian state of South Australia. This act aims at protecting and conserving the
environment and also to set up the authoritative body which will protect the environment
along with the powers and functions resting in the hands of the company. This act is
designed to protect and promote the environment and the principle of sustainable
development and conservation of the scare resources. This act also makes sure that all the
reasonable and the practical measures which are taken into consideration are taken with
the aim of protecting, maintaining, enhancing and the attribute and restoring the quality
of the environment. The company involves undertaking of all the prescribed activities of
the environmental implication which is listed in the Schedule 1 of this act. According to
the provision of the act the company includes metallurgical metals and minerals work.
 Electricity act, 1996 and Electricity (general) Regulation, 1997- this act is made with
the purpose of regulating the electricity industry and also to supply for the improvement
of technological and safety regulation for electrical beginning. The provisions of this act
is governed by the Essential Services Commission of South Australia (ESCOSA).
According to this act the company needs to involve the construction and operation of a
gas-fired power plant, additional electricity transmission line, co generation plant and
other electrical infrastructure (Blanpain and Bisom-Rapp, 2014). For the company either
a new license or a little variation in the existing license which may be required by the
company to operate the transmission lines and to generate more and more electricity.
Also, the company under this act needs to take a mandatory support to accomplish the
work near the electrical set up which is not already authorized under the company.
3 Different treaties, agreements and conventions which affects and impacts the provision of the
products and services of the company
A treaty refers to an agreement which comes under the international law entered into by
the companies in the international markets mainly as sovereign states and the international
organization. It can also be defined as a international protocol, convention, pact or an agreement
signed in by two or more countries or companies (Dolzer and Stevens, 1995). A treaty may also
be discussed as an official document which expresses the agreement in terms of words and it is
3

also specifies the objective of the outcome of the event which communicates and acknowledges
the parties and their predetermined relationships. The treaties and conventions create
international rules and standards that the international companies should abide and follow. The
treaties are of two different types which are bilateral treaty and the multilateral treaty. In the
modern international convention law, the importance of treaties is increasing trends and new
global regulations has been increased. In the following points there is an explanation of
international treaties and agreements and their impacts on the products and services provided by
multinational company BHT Billiton in the Australian market.
Bilateral treaty- a bilateral treaty is referred to as a treaty or an agreement which is strictly
signed between the two state parties only. These two parties can may be any of the two different
states or any two international organizations or a combination of either of one state and one
international organization. Australia has bilateral agreements with other countries namely
Denmark, Poland, Turkey, Thailand, and among others. The bilateral agreements between the
Government of Australia and the multinational corporations lead to improved and maintained
access to tax exemption and foreign market entry requirements to the Australian market. The
trade barriers coming in the way of international trade were reduced and this led to the increase
in the free trade agreements between Australia and the other international firms (Pauwelyn,
2003). One of the major bilateral contract of BHT Billiton is selling uranium to China. The BHP
Billiton company is the world's largest mining company which is positioning itself high by
supplying China with uranium for last few decades. The company has increased the trade of
uranium with China because the country is now developing its nuclear business where uranium is
a main raw material required. Now the company also has good trade relation with other countries
for uranium to customers like in France, Sweden, Finland, Japan, South Korea, Belgium,
Taiwan, the United States United Kingdom and many more countries.
Also, there is a preferential trade agreement signed between country like Australia with
the Republic of Korea. This bilateral agreement was signed in order to liberalize the access to the
market for different types of goods and services and investment between both the two parties.
The preferential trading area treaty (PTA) provides numerous types of opportunities for the
Korean firms to save costs and to improve their operations in Australia (Blake, 2015). Also,
another benefit from this bilateral convention or contract is that foreign players especially the
4

Republic of Korea is able to fulfill the rules of origin, and this lead to an exemption from import
duties because of the reason that it is trading with the multinational companies.
Multilateral treaty- it is a type of treaty wherein three or more sovereign states comes into a
business contract or a business relationship. In this type of treaty each and every party owes
some or the other obligation against all the other parties. These type of treaties covers practically
almost every substantive part of the international law ranging from human rights to inter state
agreements. Australia is a member of world trade organizations (WTO), which is a multilateral
organization which currently has approx 159 member countries. Australia is also a founder
member of WTO together with General Agreement on Trade and Tariffs (GAAT) its
predecessor. With help of the WTO, Australia is being able to discuss and negotiate different
trade rules applicable and have access to negotiations jointly with the other member nations.
Because of the establishment of business rules it led to lowering down of the cost for products
offered by the multinational firms like BHT Billiton in Australia. Also, WTO encourages and
promotes company to enlarge the production and trading of goods and services which leads to
sustainable development of BHT Billiton comapny in Australia.
The one of the greatest multilateral trade deal for Australia is the Australian-New
Zealand Free Trade Area (ASEAN) whose members include Brunei, Indonesia, Laos, Malaysia,
the Philippines, Thailand, Myanmar, Vietnam, Cambodia, and Laos. The establishment of this
multilateral treaty has created a different market share for the members in the world's economic
region. As a result of which the goods and services in Australia have become more affordable
and of high quality and it satisfies the customer base within the country. Recently, the
government of Australia has signed a multilateral agreement or treaty or a contract with China,
Japan, Korea, and the trans-pacific partnership countries. According to Giegerich, 2017, the
signing of this treaty ensures a smooth flow of exports from the participating companies with
reduced sanctions, and this makes the price of goods and services in Australia as cheap as much
as possible. Further, international monetary organizations (IMF) provides sources of capital for
the firms, and this leads to increased production of goods and services within the country in
order to empower the economy of the country.
5

REFERENCES
Books and journals
Besson, S. and d'Aspremont, J., 2017. The Sources of International Law. In The Oxford
handbook on the sources of international law (pp. 1-39). Oxford University Press.
Blake, J., 2015. International cultural heritage law. OUP Oxford.
Blanpain, R. and Bisom-Rapp, S., 2014. Global Workplace: International and Comparative
Employment Law Cases and Materials. Wolters Kluwer Law & Business.
Dolzer, R. and Stevens, M., 1995. Bilateral investment treaties. Martinus Nijhoff Publishers.
Giegerich, T., 2017. Treaties, multilateral, reservations to. T. Giegerich/Max Planck
encyclopedia of public international law [Electronic resource].–Available at:
http://opil. ouplaw. com/view/10.1093/law: epil/9780199231690/law-9780199231690-
e1680.
Lester, S., Mercurio, B. and Davies, A., 2018. World trade law: text, materials and commentary.
Bloomsbury Publishing.
Omar, P. ed., 2016. International insolvency law: Themes and perspectives. Routledge.
Pauwelyn, J., 2003. A typology of multilateral treaty obligations: are WTO obligations bilateral
or collective in nature?. European Journal of International Law. 14(5). pp.907-951.
6