Legal Aspects of International Trade and Enterprises

This report discusses the legal regulatory framework of Nike and evaluates the treaties, conventions, and agreements made by the company. It also highlights the importance of managing legal issues and intellectual property in the global marketplace.

Running head: REPORT 0
LEGAL ASPECTS OF INTERNATIONAL TRADE AND
ENTERPRISES
MAY 2, 2019
STUDENT DETAILS:

REPORT 1
Executive Summary
The management point view over the international trade law is
rendered with the focus on the legal connotations of development or
advancement in the global marketplace. This report states the legal
regulatory framework of Nike. In the following parts, the treaties,
conventions and agreements made by the company is also evaluated.
The company runs functions very continently and effectively by
significantly managing the legal issues or problems by adopting
relevant laws, rules and regulations. It is very necessary for the
company It is very necessary for the company to end the problems
related to the intellectual property and to make the brand name and
image of company.

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Contents
Executive Summary..............................................................................1
Introduction............................................................................................3
Company Overview...............................................................................3
Legislative regulatory framework..........................................................3
Treaties, Conventions or Agreements..................................................5
Conclusion.............................................................................................7
References............................................................................................8

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Introduction
The international law provides to enhance the foreign trading,
investments and encourages the success. It is significant to know how
to adopt the various laws in different marketplaces and complete
every transaction and agreement without avoidable problems or
issues. With the help of international law, the companies will be able
to know the fundamental legal principles included in the business
conducted out of the country (Johnsongriffin, 2016). The companies
will also avoid the legal fights by recognising the fundamental rights
and duties of the purchasers and traders structured by international
rules. In the following parts, legislative regulatory framework of Nike,
and treaties, conventions and agreements made by Nike is discussed
and critically examined.
Company Overview
Nike, Inc. is casual wear and equipment dealer based in USA, which
was founded in January 1964. Nike, Inc. is a top designer, dealer, and
supplier of athletic footwear, casual clothing, tools, sports
accessories, and the accessories related to fitness. Nike, Inc. majorly
provides the consumer goods in various places like European
countries, African Countries, North America, Greater China, Middle
East, Asia Pacific, and Latin America (Mahdi, et. al, 2015). The
headquarters of this company are located near Beaverton, Oregon. It
has operated over one thousand retail stores everywhere in the world
like Africa, Europe, China, Asia and North America. Nike, Inc. hired
73,100 workers worldwide (Schrock, et. al, 2016). Nike Australia
wholesales and retails sports goods and clothing (Young, 2016).
There are 414 employees in Nike Australia Pty Ltd including the
workers from subsidiaries under control of company This Company
runs in sporting goods industry. In this industry, the competitors of
company are Reebok, Puma, and Adidas.
Legislative regulatory framework
Almost all the sportswear, footwear, tools, sports accessories, and the
fitness accessories are produced out of USA (Weast, et. al, 2017).
Also, mostly all the sportswear, equipment, footwear, sports
accessories, and the fitness accessories are traded out of USA. In this
way, Nike, Inc. has great risks normally connected with international
trade and conducting business out of the country. These risks involve
the international laws, rules, and regulations, different choices of

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consumers across geographical areas, political conflict, interruptions,
delay in cross-border shipment, and the modifications in economic
conditions in the nations where the goods are produced or in which
countries company sells the goods. It involves, for an instance, the
improbability surrounding the application and influence of Brexit,
involving the modifications to the legislature and regulatory
framework, which are applicable to UK and its relations with EU.
Additionally, occurrence of diseases, bomber activities and army
conflict and navy conflict has enhanced the risk of conducting
business in foreign countries. These elements, amongst others, can
influence the capacity to produce the goods or obtain resources, the
capacity to import goods, a capacity of trading the goods in foreign
marketplaces and the cost of conducting businesses. In a case where
one or all the elements create the conducts of business in the specific
nation unwanted or unreasonable, the business can be influenced in
negative manner (Segars, 2017).
Additionally, most of the imported goods are subject to tariff, duty, or
quota, which influence the quantities and costs of different kinds of
products imported in USA as well as other nations including Australia.
The nation, where the goods of company are manufactured and
traded can remove, regulate, or apply new quota, duty, and tariffs. It
may also remove, adjust, and secure actions, cargo restriction to stop
bomber activities, anti-dumping duty, and limitations over currency’s
transfer, laws related to changes in climate, goods security laws or
other limitations, and the activities that may have the negative impact
on the outcomes of functions and economic conditions (Dempsey,
2017).
Moreover, Nike, Inc. is subject to taxation laws, rules and regulations
in USA and various international dominions (Nayak, 2017). The latest
financial condition as well as the political condition creates the
taxation laws, rules, and regulations in any dominion, involving USA,
subject to important changes. There are certain offers to reform
taxation law of USA and international taxation laws, which can
expressively influence how USA MNCs are taxed on the international
earning. Though the company may not expect whether or in which
form the offers to apply, most of the offers taken into consideration, if
passed in laws, can have the negative influence over the cash flow
and income tax expenses of the company. Besides, the company gets
significant part of the earning in the international nationsand is subject
to the taxation rules, regulations, and laws of those dominions. In a
case where the capital or financing requirements in USA need to
deport income from international dominions over the present level, the

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current income tax rate for influenced period can be adversely
influenced.
In the ordinary course of business, the company is included in legal
actions in relation to contractual relations and service relations,
products accountability claim, the right related to trademark and the
varieties of different cases. The company records the contingent
liabilities resulting through the claim against it, involving related
authorised cost, while the losses are evaluated to be feasible and the
losses are properly venerable. Evaluating probability of the losses and
assessing possible loss needs evaluation of multiple elements,
involving in certain matters decisions regarding the possible acts of
third-party applicants and court. Further, the recorded contingent
liabilities are depended the good data available and real loss in the
upcoming period are integrally unclear. In a case where the future
adjustments to evaluated possible upcoming loss or real loss go
above the recorded liabilities for these claims, the company will record
the additional costs during a time where the real loss or changes in
estimates happened (Sornarajah, 2017).
The company is required to comply with the export and import
control laws and regulations of the nations where Nike runs business.
In addition to contingent liabilities documented for possible losses, the
company discloses contingent liabilities while there are appropriate
possibilities that the final losses would significantly go above recorded
liabilities. Besides, Nike, Inc. is called upon timely to protect itself
against the legislatures and regulatory framework relating to the
businesses of company. Because of the integral worries of lawsuit
and regulatory actions, it is not possible for the company to precisely
forecast the result of these actions. The adverse result can have the
negative influence over the business of company, economic position,
and outcomes of the functions related to business. Additionally, the
substantial lawsuit in an upcoming period irrespective of the merits
can avert the attention of administration from the functions and
outcomes in substantial legal charges (Bhala, 2015).
Treaties, Conventions or Agreements
One can understand the expressions like treaties, conventions, or
agreements through the website of Nike. The terms such as treaties,
conventions, or agreements create the legitimately binding
agreements between Nike, Inc. and the consumers. Throughout, and
next, the latest election of USA president, there have discussions and

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commentaries in relation to possible important modifications to the
trading policies, tariffs, laws and treaties, involving NAFTA and tariffs
and trading policies influencing China. There has also the discussion
in relation to disallowances of taxation deduction for traded goods or
the obligation of independent tariffs on the goods, which are imported.
This is not known at the period whether and to what extent new laws
would be enacted, due or original regulatory offers would be
implemented, the foreign trading agreements would be bargained, or
the consequence that these actions would have, either in positive way
or in negative way, on the business, or over the company. The
corporation, as same as various other MNCs, creates the
considerable amount of trade, which will be affected by these
modifications. In a case where, the new rules or laws are applied, or
in the case where present trading agreements are again bargained,
this can be time-taking and very costly for the company to change the
functions and processed related to business in order to follow to or
conform to these modifications. These functional modifications can
have the substance negative impact over the business of company,
economic position as well as outcomes of the functions (Childs and
Jin, 2018).
Further, the corporation has the agreements regarding the production
with independent contract manufacturers in India Brazil, Argentina,
Italy and Mexico to produce footwear for trading mainly within those
nations. For financial year 2017, five footwear contract producers
each accounted for higher than ten per cent of manufacturing of
footwear and in the aggregate accounted for about sixty nine per
cent of manufacturing of footwear of Nike Brand. Nike makes the
promotion of products by sponsorship agreements with celebrity’s
athletic team, specialized team and university athletic team. In the
addition of this, during a financial year 2017, Sojitz America rendered
funding and buying services for goods of Nike traded in some Nike
marketplaces involving Canada, India, Argentina, Thailand, Brazil,
Uruguay and South Africa, excluding the goods manufactured and
traded in the similar nation. The latest agreements with Sojitz America
end on 31st May 2018 and cover the provisions permitting the
company to expand the agreements to 31st May, 2019 (Cullet, 2017).
Furthermore, where the trading security measures are applied, it is
believed by the company that it has the capacity to establish, over the
time, proper substitute resources to supply the consumer goods
attained from the latest dealers. In a case where the occasions
stopped the company from getting goods through the dealers in the
specific nation, the functions can be provisionally interrupted and the
company can experience the negative economic influence. Though, it

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is also believed by the company that it can decrease these
disruptions, and that much of the negative influence on the supplies
will, consequently, be of the short run scope, even though alternating
supplying means may not be as money-making or commercial and
can have the ongoing negative effects on the productivity (Pauwelyn,
Guzman and Hillman, 2016).
Moreover, Nike, Inc. promotes for trading liberalization for casual
clothing and footwear various local and mutual free trading
agreements (Carr and Stone, 2017). In addition, in the certain nations
out of the USA, domestic legislatures need worker’s presentation by
the work councils (that can be entitled to data and discussion on
various decisions related to company) or through the entities as same
as the union. Additionally, in various nations of Europe, it is required
by the corporation through domestic laws to take entry within and
conform to industry-wide or country collective negotiating agreements.
The company has not practiced the material disruption of the
functions because of labour disagreement. Also, if some endorsers
were to prevent utilising the products in opposition to the supporting
agreements, the business of company can be negatively influenced.
The activities considered by athletes, team and endorser, linked with
the goods, which spoil the images of the athletes, team or association,
or endorser, can also severely damage the company’s brand image
with consumer and, as an outcome may have the negative influence
over the trading condition as well as economic condition of company
(Petrie, 2016).
Conclusion
As per the above analysis, it can be concluded that the legal features
of the international trading address the complex or critical international
legal structure that makes able the people, business, groups and
government of country to productively and lawfully exchange the
related services and products across the borders. It is very essential
for the company to reduce the issues related to the intellectual
properties and to keep control on the assets and brand of
organisations. The company may stay competitive in current
marketplaces by considering the knowledge and proper
understanding related to anti-trust laws and competitions. It is

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recommended to the company that it should keep the business
operating very easily and in effective manner through significantly
handling the legislative problems arising from E-commerce.
References
Bhala, R. (2015) Dictionary of International Trade Law, (2015). New
York: LexisNexis.
Carr, I. and Stone, P. (2017) International Trade Law. Cambridge:
Cambridge University Press.
Childs, M. and Jin, B. (2018) Nike: An Innovation Journey. In Product
Innovation in the Global Fashion Industry (pp. 79-111). Palgrave
Pivot, New York.
Cullet, P. (2017) Differential treatment in international environmental
law. New York: Routledge.
Dempsey, A.L. (2017) Evolutions in Corporate Governance: towards
an ethical framework for business conduct. New York: Routledge.
Johnsongriffin, J., Nike Inc, (2016) Shoe upper. U.S. Patent
Application 29/527,185.
Mahdi, A., Abbas, M., Mazar, T.I. and George, S.A. (2015) A
Comparative Analysis of Strategies and Business Models of Nike, Inc.
and Adidas Group with special reference to Competitive Advantage in
the context of a Dynamic and Competitive Environment. International
Journal of Business Management and Economic Research, 6(3), pp.
167-177.
Nayak, T. (2017) " Just Do It"@ Ad Campaign: The Case of Nike
Inc. Globsyn Management Journal, 11.
Pauwelyn, J.H., Guzman, A. and Hillman, J.A. (2016) International
trade law. USA: Wolters Kluwer Law & Business.
Petrie, J.G., Nike Inc, (2016) Shoe midsole. U.S. Patent Application
29/520,561.
Schrock, A.M., Nurse, M.A., Pisciotta, J.C., Amos, M.S., Owings, A.A.
and Meschter, J.C., Nike Inc, (2016) Footwear having sensor system.
U.S. Patent 9,462,844.

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Segars, J.L., Cognitive Scale Inc, (2017) Display screen with a
cognitive commerce personal shopping profile graphical user
interface. U.S. Patent Application 29/535,295.
Sornarajah, M. (2017) The international law on foreign investment.
Cambridge: Cambridge University Press.
Weast, A.B., Cobbett, J.R., Crankson, K., Kash, B., Oyibo, L., Lowe,
E.S., Micheletti, M., Buxton, B., Raven, D., Henderson, K. and
Zipperer, J., (2017) Wearable device having athletic functionality. U.S.
Patent, 9, pp. 734-477.
Young, M.A. (2016) International trade law compatibility of market-
related measures to combat illegal, unreported and unregulated (IUU)
fishing. Marine Policy, 69, pp. 209-219.