BUS706 International Business Law and Ethics - Short Response Task 3

This assignment solution addresses several key issues in international business law and ethics. It begins by examining the ethical approaches used by Donald Trump in the Huawei ban, contrasting Utilitarianism and Kantian ethics. It then delves into electronic contracts, analyzing the application of the ECC and CISG in scenarios involving Kettle Black and PuriTea, including offer acceptance, validity, and electronic signatures under MLES. The assignment also discusses Kate's personal order and the possibility of amending typographic errors under ECC. Finally, it examines the enforceability of an arbitration award under the New York Convention, considering arguments Wicks can use to challenge the decision based on the composition of the arbitral authority and the nature of the damages awarded. Desklib offers a wealth of similar solved assignments and past papers to support students in their studies.

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International Business Law and Ethics

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Part A
Question 1
Issue
What are the ethical approaches which are used by Donald Trump while making his
decision?
Rule
The Consequentialism or Utilitarianism ethical theory is part of normative ethical theories.
This theory argues that the morality of a situation is judged not by the actions taken by the
parties; instead, it is analysed based on the consequences of those actions (Mulgan, 2014).
The key element of this theory provides that ethical actions assist in achieving greater
happiness for a large number of people. As long as this element is fulfilled, the actions taken
by parties are justified even if they are considered as illegal (Westermarck, 2017).
Application
The decision taken by Donald Trump to blacklist Huawei is taken in order to ensure that the
company did not use its products to sell trade secrets, listens to the conventions of the US
military and spy on the US. These actions adversely harm the interest of millions of people
living in the US. Thus, this action is considered as ethical as per the principles of
Utilitarianism ethical theory. The key element is present in this scenario because this action
benefits a greater number of people living in the United States by ensuring that their private
data is not leaked by Huawei to the Chinese government which leads to negative
consequences.
Conclusion
To conclusion, the Utilitarianism ethical approach is used by Trump when he made the
decision to ban Huawei.
Question 2
Issue

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What ethical approach can Huawei use in order to challenge the decision made by President
Trump?
Rule
Kantian ethical approach or Deontology ethical theory was given by Immanuel Kant who
argued that the morality of a situation is judged based on the fact whether the parties have
violated their duties or not (Dion, 2012). This theory provides an opposing view than
compared to the Consequentialism by arguing that in order to create a just and ethical
society, it is important to ensure that people must comply with their duties. Kant provided
that every if the actions taken by a person leads to positive consequences is considered as
unethical in case he/she violates his/her moral duties while taking such decision (Crossan,
Mazutis and Seijts, 2013). This theory judges the maxim (moral behind taking the decision)
of parties in order to decide whether such action is ethical or not.
Application
The decision taken by President Trump to blacklist Huawei is made with any constructive
evidence against the company that prove its involvement with the Chinese government to
spy on the United States through its products. By blacklisting Huawei, the duty owed by the
President to protect the interest of corporations is violated, and his maxim is to benefit the
United States by negatively affecting Huawei. Thus, Huawei can argue based on the Kantian
ethical approach that this decision is not ethical since it violated the duties of President
Trump.
Conclusion
In conclusion, Huawei rely on Deontology ethical approach in order to challenge the
decision made by President Trump

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Part 2
Question 3
Issue
Whether the electronic contract made between Kettle Black and PuriTea is governed by the
provisions of the “United Nations Convention on the Use of Electronic Communications in
International Contracts” or Electronic Communications Convention (ECC)?
Rule
Article 1 of the ECC provides that it applies to “electronic communications” which are
formed between parties in which one of the parties has their place of business within a
Contracting State (Castellani, 2016). These provisions given in ECC applies only on
commercial contracts, and they did not apply on deeds of title, personal and family matters
as given under Article 2.
Application
Australia is a part of ECC, and it has implemented the Electronic Transactions Act 1999 (Cth)
in order to comply with these provisions. Since Kettle Black is operating in Australia, this
commercial contract is governed by ECC as per article 1.
Conclusion
In conclusion, the contract is governed by ECC since Australia is a part of ECC, and the
provisions given under Article 1 apply in this scenario.
Question 4
Issue
Whether a valid contract is formed between Kettle Black and PuriTea?
Rule
The ECC only provides provisions regarding the validity and enforceability of electronic
contracts, and it did not provide provisions regarding the determination of when offers and

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acceptance becomes effective. The UN Convention on Contracts for the International Sale of
Goods (CISG) provides regarding these policies. Section 18 (2) provides that an acceptance
become effective when it reaches the offeror (Gillette and Walt, 2016). In case time-period
is fixed by the offeror for receiving the acceptance, then the acceptance must be given
within such time to be considered as effective. Moreover, the general rule of acceptance
provides that it becomes effective when it is received by the offeror except for the postal
rule in which the acceptance becomes effective when it is sent. In Brinkibon Ltd v Stahag
Stahl GmbH [1983] 2 AC 34, it was held that electronic contracts are considered as an
instantaneous medium of communication; therefore, the acceptance takes place when it is
received.
Application
In the given case study, PuriTea specified that the acceptance should be given before 11:59
pm May 31, after which the offer will become ineffective. Although the acceptance was sent
by Kettle Black at 11:58 pm May 31; however, PuriTea received it at 12:05 am June 1. As per
the provisions discussed in CISG, the acceptance is not considered as valid since it is
received by PuriTea after the time period lapsed. Furthermore, this is also supported by the
judgement of Brinkibon Ltd v Stahag Stahl GmbH.
Conclusion
In conclusion, a valid contract is not formed between Kettle Black and PuriTea.
Question 5
Issue
Whether circumstances will change if PuriTea immediately responds by claiming that the
contract is not formed since the email is received after the deadline?
Rule
Article 18 of CISG provides provisions regarding the validity of an acceptance, which is
crucial while forming a valid contract through electronic communication (Kornet, 2012). It
provides that if acceptance is not received within the fixed time period, then a valid contract
is not formed.

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Application
Since the acceptance given by Kettle Black is not valid, the rejection made by PuriTea by
claiming that the email is received after the deadline would not change the circumstance.
Conclusion
In conclusion, the circumstances will not be changed because a contract is not formed
between parties.
Question 6
Issue
Whether the signature used by Lei is valid as per UNCITRAL Model Law on Electronic
Signatures (MLES)?
Rule
Article 6 (1) of MLES provides that in case the parties are using an electronic signature to
form a commercial contract, then it must be reliable in order to use for such reason based
on which the data message was generated by the parties (Srivastava and Koekemoer, 2013).
Subsection 3 provisions regarding specific criteria which must be fulfilled in order to
consider the electronic signature reliable for the purpose of satisfying the requirements.
Subsection 3 (a) provides that signature creation data are only linked with the signatory and
no one else and (b) such data must be in the control of signatory only. Subsection 3 (c)
provides that in case parties make changes in the electronic signature, then it must be
detectable (Todd, 2017). Article 9 provides provisions regarding the certification service
providers in which subsection 1 (b) provides that they must exercise reasonable care in
regards for ensuring that the accuracy and completeness of the representations made in the
certificate are correct.
Application
In the given case study, the contract which is sent by Lei did not meet the requirements
given under Article 6 of MLES. The contract can be freely edited, and the changes made in
the contract cannot be tracked, which violates the provisions given under Article 6 (3) (c).

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Furthermore, Lei did not exercise reasonable care, which is expected from him regarding the
accuracy and completeness of the contract since he forgets to update the time limit, which
violates Article 9 (1) (b).
Conclusion
Thus, the signature used by Lei is not valid as per MLES.
Question 7
Issue
Whether ECC applies on the personal order of Kate?
Rule
Article 2 of the ECC provides provisions regarding the electronic communications in which
the principles of this Convention did not apply. As per subsection 1 (a) of this article, the
provisions of this convention did not cover electronic communications which are made for
personal, family or household purposes (Pettenger, 2016).
Application
The order given by Kate to PuriTea is for her personal use since she wanted to try its
products herself based on which this the provision of this Convention did not apply as per
Article 2 (1).
Conclusion
To conclude, ECC did not apply to the personal order of Kate.
Question 8
Issue
Whether Kate will be able to amend her typographic error as per the provisions of ECC?
Rule
Article 12 of ECC provides provisions regarding interactions between “automated message
systems” (AMS) and a natural person (Castellani, 2016). As per this Article, these contracts

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are considered as valid. Article 14 provides that in case an error is made, then the person
corrects such error by notifying other party regarding the error as soon as possible.
Application
Kate contacted PuriTea the same day based on which she notified the company regarding
the error based on which she has the right to amend her typographic error under Article 14.
Conclusion
To conclude, Kate can amend her typographic error as per ECC.

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Part C
Question 9
Issue
Whether the arbitration award can be enforced by Styled based on the provisions of New
York Convention (“Convention on the Recognition and Enforcement of Foreign Arbitral
Awards”)? What arguments can be made by Wicks to challenge the enforcement of the
arbitration decision?
Rule
As per 1958 New York Convention, a relevant provision is given under Article V (1) (c) which
provides that the court can avoid recognising the award in case the agreement that formed
between the parties for the arbitration did not cover the matter that it resolved by the
award (Arfazadeh, 2014). For example, if the agreement is made between the parties to
resolve the dispute based on a contractual issue and the arbitration tribunal provided its
award based on damages given on tort law is considered as not enforceable under Article V
(1) (c) (Smutny, Smith and Pitt, 2015).
Furthermore, relevant provisions were given under Article V (1) (d) which provides that the
arbitration award is not recognised by the court in case the composition of the arbitral
authority that entertained the case or the arbitral procedure that is followed by the parties
is not as per the agreements which are made between the disputed parties (Smutny, Smith
and Pitt, 2015). As per this article, if the country in which the arbitration took place is wrong
or if the number of arbitrators is less, then the court can reject the application of the
arbitration awards. Furthermore, punitive damages are not awarded by the arbitrators, and
enforcement of these awards is denied.
Application
In the given case study, Styled and Wicks agreed to settle their dispute through arbitration
based on the provisions given under the agreement which was formed between them. As
per this agreement, they agreed that the arbitration tribunal must consist of five arbitrators;

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however, the case was entertained by only four arbitrators. Wicks can argue that the
awards are not enforceable under Article V (1) (d) since the composition was not made
according to the agreed made between the parties.
The payment of USD 50,000 is a punitive award which is not likely to be enforceable by the
court. Moreover, the decision given by the arbitration tribunal regarding the separate
recurring issue brought by Wicks regarding the removal of labels by Styled is not
enforceable as well as per the provisions given under V (1) (c). The parties agreed to resolve
their dispute regarding sending candles that did not smell like “Christmas Cookies”;
however, they did not agree to resolve the dispute regarding the removal of labels by
Styled; thus, this award is not enforceable as per V (1) (c).
Conclusion
In conclusion, Styled cannot enforce the arbitration award as per the provisions gave under
Article V (d) since the composition of the arbitration was not according to the agreement
and the arbitrator issued punitive awards. The award given regarding removal of labels is
also not enforceable since the agreement did not cover this matter as per V (1) (c).
Question 10
Issue
How would the arbitration proceedings differ, if parties relied on the ICC International Court
of Arbitration?
Rule
Since ICC Court is the world’s leading institution that provides dispute resolution facility to
parties, it offers unique services to parties. One of the key differences between the ICC
Court and New York Convention is the “appointment method” which is used to settle the
dispute (Webster and Buhler, 2014). The ICC Court is responsible for appointing the
arbitrators, or they are nominated by the parties, and it oversees the process to ensure that
an adequate number of arbitrators are available.
Application

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In case Styled and Wicks would have relied on ICC Court for the settlement of their dispute,
then it would have ensured that the number of arbitrators is enough to settle the dispute
which would have appointed the non-enforcement of the arbitration award.
Conclusion
To conclude, the arbitration award would have been enforceable if the parties would have
used the ICC Court.
Question 11
Issue
What are the contractual consequences which occur since Styled has not been legally
incorporated, and what are the benefits of incorporation?
Rule
After its incorporation, a company becomes a separate legal entity which provides it the
right to form a contractual relationship with third parties. In these contracts, the directors
and members of the company cannot be held personally liable (Lee, 2015). The benefit of
incorporation is the protection of members from liabilities and the ability to hold other
parties liable for contractual breach.
Application
Since Styled has not been incorporated, the company has not become a separate legal
entity, and it has not acquired the right to enter into a contract with third parties which
means its directors and members are personally liable for its debts. Otherwise, members
could have relied on the benefit of incorporation to limit their liability toward third parties.
Conclusion
To conclude, the members will be held personally liable since the company is not
incorporated.
Question 12
Issue

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Which is the appropriate international judicial body for Styled and Wicks to deal with
incorporation dispute?
Rule
The International Court of Justice (ICJ) is the principal judicial organ of the United Nation
(UN) that has the authority to entertain cases involving a dispute between two or more
States; however, it also allows organisations and individuals to access their jurisdiction as
well (Kolb, 2013).
Application
In this case, the selection of ICJ is the sustainable option since it will allow parties to resolve
their dispute appropriately while applying relevant laws and this decision will be
enforceable on them as well even though Styled is not incorporated.
Conclusion
To conclude, ICJ is the appropriate international judicial body for the parties.
Question 13
Issue
Which is the most appropriate option for Styled and Wicks between arbitration and
litigation for resolving their intellectual property (IP)?
Rule
Usually, international arbitration is not considered in disputes relating to IP law since
arbitration is the private and confidential procedure, and they are not used for the public
policy issued (Okediji, 2013). IP rights are monopolies granted by States, and they are also
registered with state authorities; thus, the dispute of IP is solved through litigation in most
countries (Okediji, 2013).
Application
Styled and Wicks should use litigation since arbitration laws are not suitable to resolve
disputes relating to IP.

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Conclusion
To conclude, litigation is a suitable option for Styled and Wicks.

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References
Arfazadeh, H. (2014) Arbitrability under the New York convention: The lex fori
revisited. Arbitration International, 17(1), pp.73-88.
Brinkibon Ltd v Stahag Stahl GmbH [1983] 2 AC 34
Castellani, L.G. (2016) The United Nations Convention on the Use of Electronic
Communications in International Contracts at ten: practical relevance and lessons
learned. Journal of Law, Society and Development, 3(1), pp.132-152.
Crossan, M., Mazutis, D. and Seijts, G. (2013) In search of virtue: The role of virtues, values
and character strengths in ethical decision making. Journal of Business Ethics, 113(4),
pp.567-581.
Dion, M. (2012) Are ethical theories relevant for ethical leadership?. Leadership &
Organization Development Journal, 33(1), pp.4-24.
Gillette, C.P. and Walt, S.D. (2016) The UN Convention on contracts for the international sale
of goods: theory and practice. Cambridge: Cambridge University Press.
Kolb, R. (2013) The International Court of Justice. London: Bloomsbury Publishing.
Kornet, N. (2012) The Common European Sales Law and the CISG—Complicating or
Simplifying the Legal Environment?. Maastricht Journal of European and Comparative
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Lee, J. (2015) Resolving concerns of treaty shopping in international investment
arbitration. Journal of International Dispute Settlement, 6(2), pp.355-379.
Mulgan, T. (2014) Understanding utilitarianism. Abingdon: Routledge.
Okediji, R.L. (2013) Is Intellectual Property Investment-Eli Lilly v. Canada and the
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Pettenger, M.E. ed. (2016) The social construction of climate change: Power, knowledge,
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Smutny, A.C., Smith, A.D. and Pitt, M. (2015) Enforcement of ICSID Convention Arbitral
Awards in US Courts. Pepp. L. Rev., 43, p.649.
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Todd, P. (2017) E-commerce Law. Abingdon: Routledge.
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