Legal Aspects of International Trade and Enterprise

Running head: LEGAL ASPECTS OF INTERNATIONAL TRADE AND ENTERPRISE
LEGAL ASPECTS OF INTERNATIONAL TRADE AND ENTERPRISE
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1LEGAL ASPECTS OF INTERNATIONAL TRADE AND ENTERPRISE
Table of Contents
Introduction:...............................................................................................................................3
Legislative Regulatory Frameworks affecting Business:...........................................................3
Treaties, conventions or agreements affecting on the products:................................................5
Conclusion:................................................................................................................................6
References..................................................................................................................................7

2LEGAL ASPECTS OF INTERNATIONAL TRADE AND ENTERPRISE
Introduction:
This report consists of a detailed research on the multinational company LVMH SA
Louis Vuitton Moet Hennessy (LVMH) S.A. is a French multinational luxury goods
conglomerate from Paris founded in 1987 as a result of a merger between Moet Hennessy and
Louis Vuitton. Its brand and subsidiaries include more than 60 prestigious brands like
Christian Dior, Louis Vuitton, Moet & Chandon and Tag and Heuer.
LVMH mainly operates in the luxury goods industry and its products are divided into
five fields: wines and spirits, fashion and leather goods, perfumes and cosmetics, watches and
jewelleries and selective retailing (Corominas and Armengol, 2013).
The group, headquartered in Paris, currently employs over 100,000 people in about
2400 stores globally. In Australia, nearly 400 employees work in all the subsidiaries of the
company. LVMH Moet Hennessy Louis Vuitton SE is mainly considered to be a luxury
goods manufacturing and retailing organisation. The business activities of the organisation
are divided in to business categories like wines and spirits, perfumes and cosmetics, fashion
products including leather goods, and lastly watches as well as jewellery. There are more than
3900 stores of the company pertaining to the 70 unique brands of the organisation
(Lvmh.com, 2019). The business category of Leather and fashion products of the LVMH
Moet Hennessy Louis Vuitton SE includes Louis Vuitton, Donna Karan, Celine, Edun and
Loewe. The organisation also incorporates make up, skin care as well as perfumes brands like
Christian Dior, Kenzo or Guerlain. The sector of watches and jewellery sector includes two
business domains, namely high quality watch making and their jewellery as well as high
jewellery sector. The selective retailing agencies of the organisation include areas like
Europe, Asia, Middle East as well as North America and Australia (Lvmh.com 2019).

3LEGAL ASPECTS OF INTERNATIONAL TRADE AND ENTERPRISE
Legislative Regulatory Frameworks affecting Business:
Rules and regulations imposed by the Government affect both small and large scale
business. The regulations are essential for any business to ensure fair competition, sufficient
protection for the relevant parties and integrity in market.
Different laws and regulations affect a business in different ways. Taxation policies
affect the business directly. An increase in the corporation taxes focussing on business profits
result to increase in cost. Following the regulations relating towards the treatment and hiring
of employees by the employers are mandatory. Law related to international trade tariffs
enforce strict guidelines for taking part in international trade.
The principal legislation that regulates all companies including LVMH is the
Corporations Act 2001. The Corporations Act is a legislative act of the Parliament of
Commonwealth of Australia.
Under the taxation system in Australia a multinational company is subjected to pay 30
per cent corporate tax. Corporate tax can affect a company’s financial and operational
positions adversely, that is with increase of the statutory or policy rate of tax there will be a
reduction in the conditional location. Location probability of 1.15% can be seen in the year
2017 with an increase of 1% tax rate (Kornprobst and Douady, 2017). There has been a
negative effect on the location having an increase in marginal effect showing low tax rates.
In 2008 a regulatory framework was adopted to measure the market surveillance to
improve the quality of conformity assessment of the company (Gerber and Sriramesh 2016).
In accordance with the regulation (EC) 765/2008, the Australian government sets out for
market surveillance and accreditation of products. The standards for this framework are
enforced by the Australian Competition and Consumer Commission.