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Business Law

BUS I NESS ENG LlSH

Tricia Smith

FINANCIAL TIMES

World buelnees iniWtipHpE:r.

Contents

Unit 1 Unit 2 unlt j Unit'! Unit 5 Unit6 Unit7 UnitS Unit 9 Ilnit io Unit1! Unit 12 Unit 13 Unit14 Unit15 Unit 16 Unit 17 Unit18

Arbitration Dlscrirni nation Competition Brand names

Patents and intellectual property Land ownership

111 confidence

Licences

Fraud

Telephone crime Money laundering Cyberspace fraud The Magic Ki ngrlom Civil litigation Liability

Who's to blame? Busi!H~SS lawyers

lnhertance tax and the family company

4 8 i2 16 20 2ft 28 32 )6 ,,0

"" ,,8

52 S6 60

6" 68

7"

Glossary Key

Check Tests Check Tests Key

· "" 1 J Arbitration

Before you read '

Discuss these questions.

:1 Have you ever been in dispute with another person over an agreement or a contract?

What was the proble-m?

2 What steps can you take, apart from going to court, to settle a commercial disagreement?

Reading tasks '

A Understanding main points

Read the text on the opposite page about 11m·\.' internatiorral disputes between companies arc resolved and answer t hese questions.

1 Why might you prefer not to go to court in the country of your bust-tess partner?

2 Whal, Cor€. H"\Q thr-ee ma\\'\ busir.ess o:\..-eas w\->.kh beve tr.c.-d~t\cr.i:llt¥ been H~.S-Qlve.J bY:J[bit[:atio!l? 3 How is a forum made up for a neutral arbitration?

4 What is the main difference between arbitration and litigation, according to the text?

Which ale the main arbitration centres?

6 In which city would you choose to arbitrate an east-west trading dispute?

Wflich specific aspects ofa contract are named in the text? 8 What do clients look for from an arbitration service?

9 What examples ol expert witnesses are given in the text? 10 Do ali th€ venues share lhe same clrbitration rules?

B Llndcrstandtng details

Murk these statements T (true) 01' F (false} <lccoJ'ding to the informnrion in the text. Find the part of the (ext that gives the: correct Information

1. Disputes only arise in commercial transactions.

2 Commodities are things traders buy and sell, usunllv raw materials, like cuffee, wool or copper. 3 A neutral Forum has a balanced composition to ensure fairness to both parties.

4 New York is the only America n arbitrati on ve nue named 1 n U1e text,

5 Arbitration is a business ill ~lseIF, for lawyer'S and their associates.

6 Name recognition for arbitration is like brand awareness for consumer goods.

7 International business depends on rapid resolution of contractual disagreements. 8 The courts of law in each country are less powerful than arbuotron panels

BUSINESS AND THE LAW DISPUTES

Arbitration J

Resolution in a neutral forum

Arbitration semes international commercial cases, says Jeremy Winter

-E You have been in a confer~ ~ ell~e ]"Q?m ill. your lawyer's l'l office lor the whole day, negotiating a crucial international

5 contract. Term by term, detail by detail, the lawyers have argued it out Someone says: 'What an: we going to put in for dispute resolution?' when YOlI started the. negoti-

HI attons you thought that the deed W<lS a certain moneyspinner for both parties, .::;0 110 disputes could arise, Now you arc not so sure. So what do you say';' W-hat do your

rslawyers advise? Ideally, you might want to be able to have recourse to t11<': muds in YOU]' own country: the other party would probably like to do the sallie in 'its horne country

20 Neither is acceptable to the other. [or Iear of hom-e-team advantage or even local bias

The answer is 10 opt for arbitration. This is not really a difficult

25 decision, and that is why arbitration is the. recognis-ed way of resolving international commercial disputes. For at least R centur-y, it has been the dominant force in dis-

3D pute resolution in areas such as shipping, commoc lues and construction. You can opt for a neutral Ioruru and have oil panel of three arbitrators. OOE;. chosen bv each

35 party, and the third (the ch~ir!llan) chosen either by the parties or the two party-appolntad arbitrators. In addition, you can keep your disputes away frcru the public eye

eo because arbitration takes place ill private, unhke litigation in the

main centres for mterna-

tlcnal arbitration are; Paris,

45 London, Geneva, Stockholm, New York. Hong Kong and Singapore, Which is used depends on the background and businesses of the parties. Stockholm, for example, W;:I.S

(ill always the olace fur arbitrating east_":west tr[ule displLtes, Lorulon 1'01" shipping and commodities Singapore looks set for a busy time. in the coming months and years

5:i after the Asian financial crisis These locations. and the arbitra-

tion centres and lawyers working rants and engineers

there, compete intensely - the cost of these people

Arbitration bodies try hard to get - the support or otherwise that

sctheir standard artnu-atlon clause snthe local legal system gives to nrbt-

put into people's contracts, so uicv tratton. (For example, if the arbt-

have a captive market once dts- tratton g-.etsbogged down as a

pules arise. They do this by publl- result of delaying tactics hy one

cts-ng their acttvtttcs LInd their party, what powers does the <ubi-

ss rules. aasratcc. or court, have to speed

What they are looking fOT is things up? \ViIl the courts readily

'name recognition'. In Europe, interfere or overturn arbitrators'

Pari~ (home of the lntemational decisionsv)

Chamber of Commerce and its - accessibility - basic things like

vnrules) probably has the best name roomgbt access, good Iactltttes (some

recognition, followed, by London of the best are now in the Gull

(horne of the London Court of states), administrative back-up,

tnternattonat Arbitration), and good telecommunications. IT sup

Geneva. What people look for tn au 110rt and even climate

vsarbitration is sp-eed, cost effective- I,O,=' National legislation also has to

ness, confidentiality and reliability lend its support to such an imp Dr-

of the arbitrators and hence their tant HCOnOm~c:. activity as arbitra-

decisions, tlon. England has taken St8PS to

The choice of venue involves a unprovc English arbitration law in

sncumplex balancing of J. number of unthe form of the Arbitration Act

factors: 1996, which came Into force at the

- the availability or good expert- beginning of 19'97.

enced arbitrators

- the avallablllty of good experi-

snenced arbitration lawyers, and FINANCIAL TI1\1ES

expert witnesses such as accoun- Wo;rl~ busjness newspaper_

Arbitr.ation

tMf1mMDmN

A Definitions

Match these terms with their definitions.

1 ~i5pul~ r~5c\utiDn (\in~ B) - a}

2 a money-spinner (line 11) ~ b)

3 have recourse to the courts (line 16) ~ c)

4 home-team advantage (line 21)· d)

5 local bias (line 22) e)

6 financial crisis (line 55) f)

7 delaying tactic> (line 93) g)

B speed things up (line 95) h)

9 interfere (line 97) i)

10 overturn decisions (line 97)' i)

!1 take steps (line 108) k)

12 come into force Olne 111) I)

unfoir treatm-e:nt accelerate

reverse something alreadv decided settling disagreement,

make use of the legat svstem

benefit from being local or on home ground meddle or get involved with

something that makes profits fa r everyo ne ways of making things take a long time become operational

serious money problems

Institute action

B Terms of disagreement and dispute

Use an appropri ate word 0 r ph rase from the box to complete each sentence.

resolve resolution dispute settle arbitrate afb.~t~atil).r. arbit~atm agree -disagre.-e G-e.1a'.l'il1',& tQ'\..tics

1 There is a serious problem we rnust trv to . ..r~5.olv.~ .

2 He was a distinguished lawyer who was an expert .

3 The. .. process took far longer than the partie; had expected.

4- This was due to the HH". employed by one of the companies invo~ved.

The question is: how are we going to this dilemma?

6 When the goods arrlved in poor condition, ace c arose over whose Fault this was, and who should bear the cost.

The best way is not to go to ccurt, which is public and costly, but to c" •••• an agreement

8 I believe you are wrong on that point - we....... . on the interpretation,

9 There is alwavs -all answe.r it yQU tl'{ hard to fi(J,d il: ~'1~PI dt{ficu~W has a .....

10 You cannot assume he will _T' •••••• to those terms: you must check with him first.

Arbitration I

C Parties to an agreement

In law. it is important to distinguish between the parties involved in a transaction or an action. Complete the sentences below, using wards from the box. Not au tne words will be needed.

sign atones buve r /selle r borrows rJleiide r supplier/prod ucer wh olesa letsjretailer s

IJwyer / (I lent teach er /student pia intif /defendant licensee /Iicen sor

franc hiser I Franch isees unc.erstgned parties to the agreement

1 Everyone promises to obey the treaty - all major countries are .. ?:i9n.~tQr.j.e.~ . to it.

2 In the civil case, the brought an action against the .

his car on purpose.

3 The price was negotiated between the private sale.

4 The bank agreed that the. made a fair profit!

. . for damaging

and the

...... of the house. in a

should pay 12% on the loan, so the

Manufacturers sell their goods to , and in turn, buy from them.

6 The relationship between 2l . .. .. and ls bound by confidentiality.

7 The beer can be produced under licence but the must lullll all the requlrernents

imposed by the.

B Some clothes cornpanles sell their products on 3 franchise basis: each country has a main ............ , with numerous people working: as ..

9 A letter was sent to the manager complaining about working condltiur.s. AU the members wrote

their names. The letter read: 'We, the. , strongly protest about conditions. at work:

10 Many projects require the coope-ration of various partners. [f they all agree to work together, they becom€'

D Word families.

Comp tete the chart. verb

arbitrate

license

person

1 . .cn:~!·tr·qtor ...

3· 6.

4 franchise

1 Recently there was a. case of a mail-order company selling televisions over [he Internet where the price of a top-line television was shown as $3 instead of$300. The web page was seen in many countries. and several customers placed nrders for the 'cheap TV', but the company said they had no obligation tD supply as the price was a mistake. What do you think? Should the company honour the orders? Vva~ it a contract? [fit was, where was it made: - in the country of origin or where the customer lives and ordered [he goods? Is. this a case for arbitration?

""" 2 J Discrimination

Discuss- these questions.

1 Employment discrimination can be based on age, gender and race - are there other categories you can think of?

2 Are women and rnen.emptoveo as equals in your country, ill terms of pay and conditions?

Reading tasks I

A Ur-dcrstanding main points

Read the text On the opposite page about an important esse about discrimination dgdlniit women in the workplace and answer these questions.

1 What is the case about?

:2 Where is the case being he~rd?

3 Who brought the appeal- the ADA or Ms Kolstad'

4 What types of discrimmatlon a-e mentioned in the text? 5 Why did Ms Kolstad sue the ADA?

6 Was (here any dispute about the facts of the dtscrimination against Ms Kolstad? 7 WhDt was. the lower Appeals Court's decision?

8 Which organisation ls mentioned that supports the ADA?

9 If the Supreme Court decides in favour of Ms Kulstad. how much may she receive in damages?

B Understanding expressions

Choose the best expl ana uo n for each of these word 5 or phrases. from the text

1 knock-on -effect {line 16)

a) blow to the body

b) wider consequences. .I () 'entry reC\lI\n=mell~

2 malice (line 32)

a) friendliness

b) wl ttl bad Or cruel intention

c) unintentional

3 reckless indifference (line 32) a} ddvir.~ withGIJt care

b) heartless and cruel

c) no! caring abcut t-ie consequences

4 upholds (line 47)

a) reverses

b) agrees with and supports

c) Se-b a 3tar.Gi:lId brier (Iille 7')

a) short letter

b) legal document c} kind of case

6 caps (lin e 85)

a) S'2.ts 2.1'1 upper lim"lt

b) interferes

c) is the head

By Patti Waldmeir in Washing-ton

Court to hear key case on discrimination

The us Supreme Cour-t today hears a case which could have <:J. big impact on the size of damages paid by US employers ill employ-

5 mcnt discrimination lawsuits. The court agreed to hB;H· the case, Carole Holstad vs' the Amer ican Denial Association (ADA), to clarity what kind of employer conduct

10 will gtve rtse to punitive damages - damages awarded to punish and deter an orrender >- in, Iawsutts involving sex discrimination. However, law employment experts

15 said that the suit was also likely to have a knock-on effect on race, age and other employment dtscrtmtnation suits brought under Title VU of the 19m Civil Right') Act

20 TIle case Involves a Iemalo lawyer employee] as a lobbyist for the! ADA, a professional trade association. A jury found that Ms Kolstad was denied promotion

25 because of intentional sex dlscrim illation. The issue before the court is not whether this is so, but whether such dtscmutuatlon must be 'egregious" before punitive

::II} damages are awarded.

Title VII permits su-ch damages where there was 'malice or ... reckless tndirierence to the federally protected rights of an individual'.

3.5 But in Ms Holstad's case an Appeals COUl"t found that the ADA's conduct was neither 'cgre gtous' nor 'truly outrageous' enough to merit punitive damages.

4Q At the moment. there is conru-

sfon over the standard of conduct necessary to attract punitive damages, with the various circuit Courts applying differing stan-

45 darda to define 'reckless inrtlfference' 1£ the Suprema Court upholds the Appeals. Court's declslon in Kolstad - that the conduct clirl not meet thts standard of

sn'egregtous' - this would set a new standard nationwide that could limit the size of both jury awards and pre-tnal settlements

'Our concern is that punitive damages would become the norm'

Conversely. if Ma Eolstad wins.

ssuu-y awards and settlements could shoot up. Her lawyers argue 'in their bri-ef that 'egregtous' is tao high a standard, and, that employ ees need only show that their

enemployers knew or should have known their conduct was probably unlawful in order to have claims

• _.a~

..,.. ,~ .. ~ _. .~~ .'1.

Ior puntttve damages put before a jill·Y.

65 'if adopted, this standard would subject employers to punitive darnages virtually every time an employee engages in intentional discrhnination against another:

70 the US Chamber of COmmerce argues in a brief Iller! to support the ADA. 'OUI' concern is that punitive damages would become the norm, not the exception,

tswheteas the law clearly intends them to be the exception,' says Stephen Bokat of the National Chamber Litigation Center; which has also backed the ADA.

80 According to Jury verdict Research, which tracks jury awards, 40% of verdicts in gender discrimination cases in the last six years bave included rJunitiv€ dam-

85 ages. The Law caps damages at $5(),O{)O-$300,OOO per plaintiff depending on the size of the employer.

A. lower court jury awarded Ms

9OKoistad back (Jay after a male employee tn the same office was, according to her lawyer's brief, 'preselected' for a promotion for which he was less qunltfied than she was.

FINANCIAL TIMES

World bus.ines:s nowspaper .

1 an "bl.m:vi~! i(lI) tOI' versus, rl1e~lIing ~!}'I.ill~L

'1 V€:T}' bad indeed, disgraceful (h'iddy used in k'g~l terrni nolcgy ill il.rneriCi., ~.)g_li'_h)

Leg,1 brief

D i scrim i natio n is unfair treatment Dr den ial of norm al privileges to peep le because of th err race. a~e, sex, n ati nnalltv or rengio n. In th IS case. the U 5 J ppeal judges. we re asked to d ec.ide if the u nfa i r treatment had been so bad as to warrant an extremely stiff penalty (punitive damages), which should deter others from similar behaviour, Note- that e-ach US stare _[Jdminjsters Irs own justice system but the system of appeal is from trial (Our! to Appeals Court and then the Supreme Court. whi-ch is thehighest appeal court in ti,. US.

Discrimination

A Complete the: sentence

U5e an appropridtt: ward or phrase from the box w complete each sentence,

limit punitive damages egregious circuit judge Act settlement jury lawsuit brief cap appeal federal rights

------------------~

1 The amount of money awarded to a vlctim has a !(t:Dit., .

2 The courts are in session at different times during the year ill different places, so that the c c can wo rk in a variety of places.

3- Wh'2.\"'\ P3r~\am'C_nt voles to pass ill Bill it be-comes il1"o ••••••.•••••••••••••

4 There is no

......... on the liability of owners in a private partnership.

5 Many people think there should be a speclatlsr .... for complex fraud case'S.

6. I\mer"\-(a'ii c~tizer.s shou\d study their H <", SG that they kl'lGW whL,l.t lawr; pcctect them

from abuse.

7 Damages set very high ill order to deter others are called.

8 A special term for very bad behaviour in the us IS

. ...... behaviour.

9 Every court decision may be sent for if circumstances justify it.

10 An out-of-court is desirable if posslhle.

11 Anyone call bring a .' that cannot be settled easily. 12 A barrister cannot work in a court without 8

". agai nst SO meone else if they fe-el they have- suffered a wran g

from a solicitor.

Ii Opposites

Match the opposites.

1 lawful ~ a) illegal

" clarity "',,- b) female

3 legal "---- c) unlawful

4 malice d) nne-off

5 pres.ele.c.tion e) c.Qllfes.5Ion.

6 male f) confu se

7 punitive g) token

8 knock-on effect h) kind intentions

9 discriminate against 10 denial

i) fair job promotion procedures

j) act fairly

( Prepositions

C:omplc[e the'ie sentence!;. with a preposition from the box.

I up under against on .;~- at-- --]

1 If she wins this case, awards and settlements could shoot £:JR .

2 Th. suits are brought....... . Title VII of the 1991 Civil Rights Act.

3 There may be a knock- n'.' •••• effect other types of discrlmlnatlcn suits will be affected.

4 The decision win have a major impact

.. employers nation-wide

5 Some companies. may be subject ... _ enormous claims.

6 The law caps damages a certain sum of maney, depending T ••••••••••• the size

of lhe (om pa ny.

7 According . the researchers, juries often award punitive damages in cases where

theTe has been dtscrimlnatlon women in the workplace.

8 What kind of conduct could give rlse .

. ..... punitive damages?

D Different outcomes

Use an appropriate word Or phrase from the box to complete each sentence.

however on the other hand if whereas should conversely might

1 The court could decide- to award punitive damages for any justified complaint. .... {iQY'!f:I(?:r: ... c, if that happened. companies would soon go bankrupt.

2 On the one hand, the-lower court may decide in favour of the plaintiff; ..

Court may decide differently.

3 The verdict may be to limit ott types. of damages ,.,' ", the verdict may be to award the

maximum possible to deter others.

4 .. they had not complained about the award, there would not have been an appeal.

5 A successful outcome for the company involved would be a limitation on the damages,

.... a worst-case scenario would be that they have to pay punitive damages.

6 . the worst co me to the worst, the ADA. . f nd themselves paying Ms

. ..... , the appeal

Kolstad punitive damages - and others too, if they file suit!

1 Check what the law in your country says about employment and equal opportunities. How do these affect disabled people? Write a brief report.

2 Research some advertisements on ·IV or ; n magazines. Can you find any which use thoughrprovoking or socially challeng.ng irn::lgt:,? l.ist thc kinds of discrimination the advertisements. try to make the: public aware- of

-~lJ Competition

Before you read

Di'iCLlSS these q uestions

1. DOES YOlLr country have a national airline? Does it have special privileges, like a subsidv or spec: i.:J ! airport facilities?

2 Do you travel by air frequently? What was the reason for your latest flight? Could you choose between several d-Ifferent airlines for the Same tripe!

3 Should all alrhnas be allowed to compete on fare pnces. as other Industries do?

4 Do you agree with free trade and competition. or is there a good reason to regulate some markets?

'ittG Hrtjfi11l

A Understanding main points

Mark these statements T (true) or F (false) eccc rding to the information in the text on the opposite page. Find the pan of the text that g"lves. the: correct mfor-uau a n.

:2 The European Commission is ill Brussels. T

:2 An alliance rs the same as a merger

3 Washington and Brussels are holding discussions at the moment on an open skies policy. 4 Open skies policy means anv airline can fly anywhere.

5 SA and American Airlines agree how much the fares should be on each other's flights.

B Uuderseanding deta i ls Answer these questions.

1 Which organisation is taking eight ElIlOpean countries to court?

2. Find the exact words that say what aspect of the law has been broken.

3 Wh.y does the EU object to agreements between an individual European country and the US? 4 What does BA hope to do with American Airlines?

5 What does the [ompetitJoi1 Commissioner do in the European Cornrnlsslon?

6 Wh-eI'J does IDA \nter.O to (,cr.c\uoe -a -Cl)d~~sh(IJ\r.g 0'2:20\ wIth P-.merical"\ A_\~\i\"\~'S?

Competition J

the rights .to fly to and tnsfde 60 another country's territory - and will not negotiate a rteal unless the terms are widened.

In London, BA said it was still committed to getting a full deal

5.5 with American Airlines in the long run. 'We want an alliance with American because the customer new thinks and trav-els globally; it said. 'But the terms put

to forward by the European

Competition Commissioner are not acceptable to us commercially:

The Competition Commissioner has demanded that BA. and

'15 American should give up 267 weekly slots free of charge at London's Heathrow and Catwtck airports 11:1 the transition period towards full ltberaltsatton, DA plans to COI1-

C'H.:.\n~1': a "l'.ode·'",.h?r\r.~ <.l.g!l.:l2.m~YY'with American. This would allow them to sell s-eats on each other's flights, but they would not set (ares jointly

By Michael Smith fn Brussels

Brussels files suit over bilateral aviation deals

The European Commission is taking eight European countries to the European Court of Justice over their bilateral aviation. deals

5 with the US. The EU'.., executivesaid yesterday that the deals distorted the EIJ air market to the detriment' of Europ-ean carriers.

Disclosure of the move coincid-

III erl with confirmation by British Airways (BA) that it was scaling back plans for a full alliance with Aruarican Airlines because: of reg. ulatorv difficulties. BA is also

15 pressing the British government to reach an agreement with the US for a grndual Ifberaltsation of the US air market. Talks between Brussels and Washington on a Iull

'2~ G'jV2I.\ sktes llQ!k;y IJtlJke d-:::.vm \"'%l month.

The Europe-an Commission's deciston to file suit against the UK, Austria, Belgium, Denmark,

2~ Finland, Germany, Luxembourg and Sweden follows a long campaign to win the approval of ED member states for seeking 1111 EU-

L d\s:>.ck\J"\ugl:

Zmadi: us<:les~ Cl PUI ~[ri~k

wide deal wlth the US. "I'here need

fI{I be no tell-back,' the Commission said. 'These individual agreemente can be written into a wider deal.'

The European Transport

3.'\ Commissioner sail! member states created serious competition.distorHom by unilaterally granting US carriers rights while ensuring exclustvtty for their own carriers.

40 EU rules were rendered

ineftectrset by the deals, he snid. The Corn mission warned member states four years ago that bllateral deals with the US would he illegal

'15 and would jeopardise' the creation of an Ell-wide (leal with Washington.

Most of the bilateral agreements 11<:lVe been signed since

;;Q, th~n. H{)w"t!\:-ey, 1.Th" Cl)mml.~-;:,l.\m held off taking legal action after winning approval from member states for starting 'ODEll sky' talks. It re-activated legal proceedings

55 after EU countnes last spring rejected its request for wmening the scope of the talks to Include market access and traffic rights -

FINANCIAL TIMES

World bl-i."ine';i"s newspaper,

C How the text .s organised

Wh.Jt do these underlined words refer to in the: text?

1 disclosure of the move (11ee9J taKing eight furopedl1 countries to court 2 I1 was sce.lng back plans (line r'i)

3 These individual agreements (line 3.1) 4 their own carriers (line 39)

5 It re-activated legal proceedings (line 54J 6 .l!2 request for widening the scope (line 56)

L Competition

Legal brief

The purpose of the ED 'IS to form a common market between members that -IS unrestr'cteo by tariif barriers. In 1986, a Single Market Act proposed the removal of all trade barriers and tariffs by 1992. The European Commission works on behalf of the EU to make routine decisions and to propose new laws that will apply to all members. The Commissioner responsible for transport policy has disciplined eight EU member states for trying to make private deals with the US, rather than cooperating in the Common Aviation Policy.

'Vttt'MlMhrt1.

A Understanding expressions

Choose t\ie best f"~p\an-ati on for e~n::h Df these worrls ar-c pnr~s't:s fmm th'i! tf:'At. roll-back (line 30)

a) delay

b) gains back on presem deals

c) limiting the agreements ensuring exdustvrrv (line 38)

a) pa'li'i\'l, ir.smant'2.

b) offering deals to several parties

c} guaranteeing a deal with only one partner transition period {line 78)

a) Ii me of no change

b) ill the middle of change e) after change has finished

1 disclosure (line 9) 4
a) telling the public
b) keep·mg a secret
c) ending a meeting
z regulatory difficulties (line 13)
a) prob\ems with the. al.ltr.orili-e.s
b) rivalry between competitors
c) financial disputes
3 gradual ltberallsatton (line 1.7) 6
a) rapid change of policy
b) refusal to change potlcv
e) slow relaxation of policy B Definitions

Match these: terms with their defi nitions.

~ bilateral (line 4) ---------._-~....._---------- a) go to (Qurt
2 distort (line 6) b) two sides
3 detriment (line 8) C) extend the limits
4 file suit (line 23) d) negative effect
5 unilateral (line 37) e) made useless
6 rendered ineffective (line 40) f) changed, in a bad way
7 held off (line Sl) g) waited 10 act
B widen the scope (line 56) h) done by one person or company C Competition words

Use an appropriate \Vo,a or phrase rrom the box to compkte c3ch sentence.

monopoly ccmpetltian regulation regulated deregulated free trade unfair compel~tion protectionism

1 Tobacco ca n only be sold at state shops in Spain: it is a c rrJPn9.p.P1y

2 When two or more companies want to sell their goods to the same customers, they are in cc '"'"cccc'" with each other.

3 tt is ,. when the rules of business do not apply equally to all participants.

4 When the European Commission issues rules about haw firms do business, the market IS sajd to be

5 When those rules are removed and the market IS free. the market is said to be , .

6 ... . .... is the concept of doing international business with no barriers Dr restrictions. 7 Hone country tries to keep out foreign c.ompetitors 50 that national industries will be safe. it is

called

8 The concept of is that of ordering and controlling how business IS conducted.

Over to you

1 Are there any protected industries in your country? Why do you think these industries are protected? Are there aliy advantages In keeping out competitors? Make a list of points for and against the regulation of competition

2- You have decided to s.tijrt a sports shoe retail business. Are you going to sell locally-made shoes or import them from other countries at a lower price? Think of 5Om~ legal factors you should consider when emering the market: for example) are there import taxes on for-eign goods? What government protection for local industry is. there?

''''4 1 Brand names

I:G,,-,;,_,"I.'1' .•

Discuss these questions.

1_ 'A rose by any other name would smell as sweet: wrote William Shakespeare. Do you agree?

How important and valuable are brand name-s'

2 In your country, are there many l-rtetnatlonal brands? Do you know where the brands originate?

p., Uoderstanctog ma\n PQlnts

Read rhe text on the oppos! ce page about e dispute betwee t1 rwo intern ational ccmpanics wi th very similar brand names and answer these questions

1 What r haracteristlcs of a trademark must be taken into account in this dispute? 2 Which treaty does the case re-Fer to?

:3 What products are made by Hle two companies in the text? 4 Why did (anan oppose the German (I~gl:;_trat[r)n of Cannon?

5 Which company used the trademark first- the lapal1ese companv (Canon) ct the US One {MGM)? 6 Which two main questions did the court consider?

7 What is the esser.ti:a.~ ew.cttcn of a \1i3del"\\~~k?

8 What confusion must the public be protected against?

9 What kind of competition does the Treaty <Jim 10 establish?

ro INtis MGM a~~[)wed to tegiste t i-s traoE:mark (annDn in German'y? Who won the- "Case?

B Understanding details Answer these questions.

1 Why is reputation important for trademarks?

2 Why does the earlier trademark flav€.' a stronger claim than the later one? 3 What is included in the concept of contusior. on the part of the public?

4 Why does the case law mention the distinctive nature of the trademark? 5 What exactly does a single undertakin'g refer to? (line 121)

6 Is ~t true tnat trademarks which are very distinctive have gTeater protection under the law than unmemorable or vague ones?

Does undiuosted competition mean the same as unfalr competition?

8 How does a trademark enable a consumer to distinguish between similar products or services?

European La w Report

Luxembourg

Can 'Cannon' be confused with 'Canon'?

public could be mistaken as to the origin of the goods or services

Canon Habushik! Katsha vs 'A trademark shall not be regis- Hl5 The essenttal function of the

Metro-Ooldwyn-Meyer Inc tered or, If regtstei-srt, shall be trademark was to guaran tee the

Case C-3Sj9i liable to be declurett Invaltd. it identity of the ortgrn nf the

Before the COlU"t of Justice of the 55 be-cause of its identity with or shu marked product to the consumer

n European Communities ilarrty to, the earlier trademark or end user by enabling him, wtth-

Luxembourg and the ldenf ty or stmtlarity of IlO out any possihtlttv of confusion, to

[Judgment 29 September 1998] the goods 01" SE'TvicE!& covered by distinguish the product or service

The distinctive character of a the trademarks, there extsts a like- from others which had another

trademark, in particular its repu- snlibocd of confusion on the part of origin.

10 tatton. had to be taken into the public, which includes the like- For the trademark to be able La

account in determining whether llbcod of association with the ear- 115 fulfil its essential role- in the sys-

there was surucient shnilarttv lter trademark.' tent of undiatorted competition

between the goods and services In its Judgment the Court of which the Treaty sought to estab-

covered by that and another pro- Gil Justice held: lis-h. it had to offer J. guarantee

1.& posed mark to give rise to tbeltke- 'The first question was whether that all the goods or services bear-

lihood of cunluslon. the distinctive character or the ize ing il had ovigtnated under: the

The: Court of Jnstic€ of the earlier mark. and in particular Its control of a single undertaking

European Communities so held. reputation, WHrB to be taken into which was responsible for their

Inter alta L, on a reference by the 70 account in determining the issue quality.

2(l German Federal Court of JUstice of slnularttv Accordtngly, the rtsk that tbe

[or a preluninary ruling under Furthermore. according to the 1251HlbHc might believe that the

A..cUd€ 177 of the Ee 'i'reB,(Y rIO!: case law of t!:1~ Court. tile rnore goods \JI· services tn question came

Article 'l(Db of the Directive of 21 distinctive the enrher mark. the from the same undertaking or "co

December 1988 relating to tr-ade- -s sreeter the risk of confustou nomically linked undertakings

::<!5 marks. since protection of a trademark constituted a likelthooc of confu

MGM applied in Germany for depended, ill accordance with ]-30 sion within tbe meamng or Article

registration of the word trade. Article 4(1)b of the Directive. on 40)1)

mark 'Cannon' to he used far video there being a llhellhood of confu- Consequently, in order to-

Itlm cassettes- and film production sustcn: marks with a btghlv dlsnnc- demonstrate that then was no

au distribution and projection for cin- ttve character, either per sa' or likelihood of confusion, it was not

ern as and television because of the reputation they 135 sufficient to show simply that

Canon Kabushlkt Kaisha possessed on the market. enjoyed there was no llkelthood -of the pub-

opposed tbe application on the broader protection than marks lie being confused as to the place

ground that it infringed its earlier 8.1i with <I less distinctive character. of production 01' the goads -or ser-

35 world trademark 'Canon' regis it followed that, fOI" the purpos VK'eS.

tered in Garmany in respect of. es of Article 4(l)b, registmtron ol 140 On those grounds the Court: of

inter alia, still mel motion picture a trademark might have to be Justice ruled:

~s,.a.ud, projectors, and tale- ref-Uf.e_d.. .. des..pLte aIesser degree of There could. be likelihood of

vision [ilming, recording, trans- eostmtlarttv between the goods and conlustou within the meaning 01"

"IfJ mission, receiving and reproduc- services covered, where the marks Arttcle 4(1)b even where the public

tion devices, including tape and were very similar and the earlier '·1,0; perception was that. the goods or

ruse devices mark, in particular its reputation, services had different places of

In the course of the proce-edings, was highly distinctive. production. By contrast. there:

it was held, inter alia, that the 95 The second question was could be no such llkeltbood where

'15 mark 'Canon' had a reputation, whether there- could be a Iikelt H did not appear that the public

but no importance was to be hood of confusion within the 150 could believe that goods or ser-

attached to that jaet ill deciding meaning-of Article 40)b where the vices CHmB Jrom ibe sam!"! unrler-

whether the marks were relevant- public perception Was that the: biking Or from econcmicallv

Iy similar. ioagoods or services had different linked undertakings

;10 Article -'l(1}"O[ Directive 89[104 places of origin. 'I'hera was such

provides: likelihood of coni US-lull where the

-- ... ----_..~-....----..-- '

1 -ilL11'-'rI); v,her thi 11g~ {tAtiI1) 2; ~11 itself (L1linj

Legal brief

In this case, the European Court of justlce ruled that the pubtic rculd easilv mistake Canon and Cannon as being the same company selling the same products and, therefore, did not allow Cannon to be registered as a legat brand name in. Europe. Canon was the winner for having established its name and brand already' in the market ln English law. where a trademark, label. logo Or design is used to tntentto nallv contuse the lJ.ublk. into thinkirlg that the. product belongs to a welt-known brand the crime is called 'passing off'.

Vocabu lary tasks

A Collocations

Match these words as they occur In the text

1 public. ~ a) of confusion

2 Buods - 1» neu.eptiou

3 world c) cornpet.tlon

4 course d) trademark

5 take e) or sef\li~es

6 likelihood f) into account

7 undistorted g) of proceedings

4 What businesses do is to provide ..

for consumers and customers.

B Complete the sentence

Use an appropriate phrase from Exercise A to complete each sentence. 1 . pu~!i.;:. N;f(~p.tiQn. is what the court thinks people generally thtnk.

2 The (curt has to.".. . _ the _repl.1tatior. 'Of th-e- t~ade\T\~rk.

3 The judge held, during the.. .. ....... , tt-e.t the company was a monopoly.

5 I n the case of s lmilar trade-narks, there. ts a strong ( Verbs of mixleading

Llse an appropriate: word or phrase from the box to complete each sentence

passing oFf impersollate copy lead (someone) tothink

1 .Pq$~JfJ9.9ff .. i5 a crime. It involves making a new product look like a well-established One.

2 ThE'- judgE' a,kE'o tue prisoner whal: ..

3 The pictu re r have on my wa II is only a .

4 The dictator hired several men to .

. . he o esE'I'Jed i;J Ie 5:;E'1 pun.snmern.

. or a Carat - I wis h it we re the real thing!

. him at official functions to confuse his enemies.

Brand names J

D Giving reasons and justifying decisions

Use an appropriate word or phrase from the box to complete each sentence.

on the grounds it was held according to case law for the purpose of proper construction within the meaning of

1 The case was dismissed .. qr.. th~. 9r.Q~jl1.q~. of inadmissible evidence

2 There are several views but. .. ..... "", it must be seen that an infringement occurred.

3 The High Court reported that, the Article, there was no likelihood of confusion.

4 On a.. .. ...... of Article 4(C) of the Directive, the distinctive nature of the trademark had

to be demonstrate-d .

.... .... that only within a rather restricted understanding could there be confusion.

6 More evidence was needed ..... .. ........ clarifying exactly what happened.

E Prepositions

Complete these sentences. with an appropriate preposition.

1 A similar trademark could give rise ,t,q , the likelihood PJ. confusion.

2 The name was registered , " respect , cameras and films.

3 The law depends......... .. the interpretation.

4- Canon was originally registered Germany.

5 A trademark may be invalid because of its identification

................. , an earlier trademark.

6 The Federal Court Justice Germany asked. . , a

preliminary ruling Article 177 of the 'EC Treaty .

.... , ... , the meaning of the same Article. there was the second question relating

the place, '> origin.

S The trademark should clearly guarantee that goods bearing it had originated. "" the

control " a 'single company.

. .... certain Articles.

. a Japanese company.

....... or similarity

1 Have you ever bought something which you thought was a branded item, or a famous. make. only to discover it was a fake? What did you do? Does having [he 'real' thing matter?

2 Write a letter to your local Consumers' Association complaining that in your local market there are numerous watches on sale that seem to be a f<1ITIOUS brand but turn out to be fakes.

t:::~ J Patents and intellectual property

1,;Gt.liJi,,'i"¥',_

D lSCUSS chcsc questions. 1_ wnat is a patent?

2 Are there laws in your country forbidding the cloning - makjng exact genetic copies. - of humans?

3 Call VOl! see any dangers In the 'ow('I.€:rsh(p' at scientific knowledge? It a new medical breakthrough ls made by a st.ientiflc team, should they be able to keep it 10 themselves until the prke is right and profit frorn ~t7

A. Under,tanding main point::>

Mark these statements T (true) or F (false) according to the information in the [ext on the opposite pi1g~. Find the part of the text that gives the correct information:

1 SGlicitms like v-er'j ~e-thr.i(a\ arlo sp~da\i5e-d erees o-f law. f

2 It 15 ~egal to clone humans Ior.spare parts at present in the UK

3 Patents protect the Formt..d.oe of drugs tor ever.

4 »ntr-n: lawIs WE't\ understood by must small research companies in the UK.

:5 The most critical part of an lnreliectual Property protection programme is 0 complete set of coni raclua I docurne ntaticn.

6 "ue in-ve-nthlene5s Df ';cief1tists wm nerve to be rna-cueo by lhl:: (hanges in th-e:: 1a.'1t

is Undersland:':ng derails Answer these questions.

1 What were the two events referred to in "line 5?

2 How many offic'lal bornes are named that deal with clornng and gene'"lcs] What are they? 3 Whatdo the Firms need to produce n thevwa-rt rcmp.ete tp nrnter.tion?

4 What kind of effer:t should this report have on the small research-based companies?

5 What kind at discussions are there likely 10 be about making money out of scientlflc research? 6 What rrdght larger (ampa(l.l~s- de if lh~¥ find a dtscoverv is nat patented?

7 Which phrase in the last paragmph means the same 85 5e€ Daly [he tip of the iceberq? 8 What kind oflegal issues does the cloning debate cause?

Patents and intellectuoiIl propert~_ J

65 duced by their research developmeut are adequately protected And many that hav€ all IP protection prog:ramme do not produce a complete set of contractual (LOCll'

ill mentation to cover (Lea lings in l.P rights. even though this. is poten t.ially the most eri tical component 01" ",11

The report is a wake-up call to

7& smaller research-based companies to take the legal unplicatlcns of their work seriously. while there are bound to be ethical debates about the: tig-ht to make uiouev out

su of this kind of activity, there ls no question that larger eompantes will have J lttle hesitation in capitalising on discoveries not properly protected, I>-ls GBbe~·t believes

&5 that we are only starting to scratch the surface of developments in this field. How il turns out will be shaped as much hy th-e application of the law as by the

90 tuventtveuess of scientists. And though the Biotechnology Directive excludes human cloning processes from patentability, conimerclal companies will not stou

95 doing the work. nor stop generating complex and puzaliug legal iSSUeS.

Our bodies patently lack protection

Intellectual property needs proper safeguarding, says Edward Fennell

Tho: marriage of intcl~ectll~l properly (IP) and hfe Beleuces creates one of these niche practices of law that most

;5 s-olicitors Iike La avoid, But two events racenuv brought home the importance or this area of law, First. the rcconuncndanon by the UK Human Fertilisation and

1{J Embry-ology Authority to permit human cloning (or 'spare parts' 1:5 ttkety to create a huge wave of research leading to a flood of patent registrations and subse-

[5 qitent. HUgatiou, PL:l11IY GHtle-rt, o[ the IP finn Brtstcws, 5-l3yS that though the European Comtuissiou Biotechnology DIrective specifically excludes ilumancloning

20 processes from patentability, it does not apply to such parts of the human bodv 3.'i tissue. 'There are'. she says, 'potcutlally valuable patents in this HeW and Litigation

2-5 between rival researchers is almost Inevitable.'

Elsewhere ill the market, the pharmaceutical companies Zeneca and Astra were deep In talks about

30 a merger. Both face the imminent end of the patent on several drugs, and heed more resources to plug the gaps. Patents are probably these companies' mast. important

3.'3 single resource and the big pltar

maceuttcal companies and life scienccs firms jealously guard them. Larger law firma such as Cameron Mclienna and Herbert Smith aJ€

Ml often engaged in litigattcn 10 Protect rights that may have beeu lntrlngerl.

Smaller research-basso companies are not always so alert to the

45 dangers ann opportuntttes of patent law. A recent report, COI11- missioned by Taylor Joynsen Garrett nom the Lonoon Business School, says: There is evidenc€ of

5(j n s~I_rPl"jSilig lack of" r'~CQ6'lJ_Hl[m of the importance of TP protection . Almost a third of companies think their investors 'understand little' or- 'not at nll' the natura of their IP

ss rights.

'Litigation between rival researchers is almost inevitable'

Only two-thirds of companies said that when it came to [P, duediligence' had been undertaken by their investors where it was rele-

00 "ant before financing their most recent investment.

Just over half the smaller cornnantes have a programme in place to ensure that all IF rights pro-

1 the oppostre "f 11~.~lj9"~CI'; used by audtrors .111d 1.1\-.ryers to show chcy have checked very carefully ill! the available documents in order LO determine LF 9 Iacc OJ" figure is correct, or who is rhc current anti lrgJI owner of [and, pTOprrry or ideas

I Patents ar1d intellectual property

rfm@@mw

A. Defmitions

Match these terms with their definitions.

1 proper safeguarding (title) \ a) complete set of details about I P rJghts dealings

2 niche practices (line 4) \ b) break a law or regulation

3 pate-nt registrauon (~\nE 14) "- 'C) adequate protecfmn

4 patentability (line 20) d) begin 10 understand something

litigation (line 24} e) taking advantage of a commercial opportunity

6 lnmnge (line 42) f) application for the sole rights of ownership

7 due d'll'lgence (line 57) g) allowing an .nvennon to be reglstereu

B contractual documentation {line 69) h) bringing a lawsuit against SOmeone

9 capitalising (line 82) i) thorough investigation

10 scratch the surface (line 86) iJ specialised areas of expertise

B Metaphor>

Use an appropriate ph rase from the box to complete each sentence.

wave of research flood of patent reglstratlons stop the leak plug the gap -:,~rat(.h the sl,IJfac.-e gOIl'C. U? ·m smok'e 'Ov'O\wrhe ()~ o;::omp\o.illts

landmark case cast a shadow over dawned on

1 Permission from the European Courts to allow cloning will bring a ... 1:J.(!XIl- .. Qf r.~$.e;9.r:t;.h .... which

will lead to a .f!r.qd. vi.p,qtmi .I:~9~$tratiol)~ ...

;2 This problem is bigger than you think. We have only just begun to 3 Our rivals have copied our work, All our hopes have

If The drug caused SEvere headaches and vomiting. There was an .. doctors and patents.

from

5 The judges' dedsion was sa 'Important that 'It changed rue way the tawwas to be lnterpreted. \'1. was a .

6 Information about the new drug was given to the press by a. laboratory technician. The manager decid ed to Suck h irn in crds r to

7 The tragic. acc.tdent """ ,"" an otherwise ha\lPY event.

8 The major drugs companies need a way to replace the money they earn from patents that are explrl.rg. They need newpatents to ."

9 The law about intellectual property IS very complex but essential to the success of the companv It

tinallv .... . thE' Managing Director that he should consult a legal expert

.Patents and lntallertual property J

C Definitions

Match these terms with their definitions.

1 permit (line 10) -~ a) competing

2 excludes [line '9) b) creativity

3 tissue (line 22) - c) allow

4 rival (line 25) d) safeguard

5 protect (line 40) e) aware
6 alert (line 44) f) skin and flesh
7 investors (line 53) g) leaves out
8. lnver.t\IJ~r.-ess (line 90) h) ?e~?1e risking money D Metaphors from water

Englis h uses a lot of metaphors from water to describe the scale of events, Eke Q flood of complaints ilnd Q huge wave of research. Complete these sentences with words from the box.

I drop flood trickle stream torre nts cascade I

1 It was tao tittle, too late - a ~f9.P. in th-e ocean.

::z The complaints started off LIS a . .. .but soon became a flood.

3 The benefits down from the upper rnanagsrner t to the whole workforce

4 There was a steady •••.. . of vlsttors when the new Centre was opened to the public.

S The rain fell in such . you could hardly see well enough to drive.

6 There was a ..... . .. of applications for the Job when the s.alary was announced.

E Metaphors from the body

Match the pam of the body with the correct phrase.

I head a) of the law

2 long arm b) for fighting

3 hand 411.art

5 no stomach

c) of the company

d) of rato

e) of the matter

Over to you

1. Make a list of the main steps a small research company should take in order to ensure that their discoveries are not stolen or copied.

2 Why do you think the Biotechnology Directive excludes human cloning pTDCe5Ses. from patentability except for spare parts? What consequences does this have for research companies?

UNIT 6

I Land ownership

Discuss. these questions

1 Who owns the lakes, rncuntains and rivers in your country? Is there a 101 of private land ownership, or d-Q~s thrc. state coouo. the CGuf1trlj'Si-de and 'undairnect' tand"? ~s tt all map';)ed and {'2g[stered?

2 Do you think commercial exptoltetron of the nan.ral resources of the land (for example, minerals) can also respect the traditions of the area whete those resources are found?

Do you know in which parts of the worlo gold and uranium are found?

A Understanding main pnints

Read the text on the opposite page about a case of land ownership and answer these questions. 1 Who are the main protesters ill Australia against ERA?

:2 What are the protesters trying to acilleve?

3 Who owns the land where the uranium is?

4 'rOT huw many years naVE' the Aboriginal people tllE'd to ban tnt: mine! 5 What is the highest Court in Australia?

6 What rights do the Aboriginal people claim they have dating from 19761

7 Do the Aboriginal people consider the contract with the mining companies to be valid? B Which company owns ERA?

9 What does the ward stand-Offmean in this context? (line 49) 10 When will mining operations begin?

B Understanding details

Mark these statements T (true) or F (false) according to the information in the text. Find the part of the text that gives the correct information.

1 The Aboriginal and environmental groups succeeded in stopping the mine. f

2 A mining tease is an official document that permits free use of land to the Owner. 3 ERA is a private company"

4 According to the text. Australia has thiee main uranium producers. 50 1he Iligh (-Qurt is the highe5t (QUIt in Australia

6 The federal court operates at a local, state level

7 The Aborigtna. people have ownership of the land

8 lf an agreemert is ITIJde when one partvls under duress. it is not lawful

Land owners h ip J

By Swen Robinson In Sydney

Aboriginal groups and environmentalists are planning protests across Australia after [ailing to block the development of ;3. urani-

5 um mine on traditional Aboriginal land in the Nor-them Terrltcry, Australia's federal court ruled last week that the territory's government had the right to grant a min-

10 ing lease at Jatnluka, which lies inside a World Heritage-listed national park, to Energy Resources of Australia (ERA). The: company JS one of Australia's two

J5 nrarnum producers.

The ruling virtually exhausted the legal options for the Mirror Aboriginal people in their zc.vcar. old campaign to block uranium

2Cl ruining on their tradrtlonal land at Jebiluka, which. contains one: of the world's largest undeveloped urannun deposits

An appeal to the High Court,

25 Australia's supreme judicial authority, is possible hut unltkely, ccnsrderlng the weight attached to decisions by the federal court's full bench, analysts said.

...

.....

so The Mfrrar grou~ was granreri custody of the land under the 197e Land Rights. Act. In recent vaars it has Iriell to overturn an earlier agreement between cue of Us for-

351l1er leaders, now dead. and mining interests. The group says that approval to mine at Jabiluka was given 'under duress'.

After the- judgment, envfron-

cumentahst groups. 'including Creenpeace and the Wilderness

Soclety. said they would step up .

their protests. both at .Iebiluka FINANCIAL TIl\1ES

and in Australia's main cities, to try World buslnessnewspapcr.

-=- •. ~ szwz4iQm4Ufi~~

45 to borlt de\tlojJillellt"O{ rhe mlne

'The managing director of North, a diversified mining company and majority owner of ERA, last week described the stand-off

50 as a 'totemic issue'. 'As far as we can se-E', Jabtluka will stay on track and on timetable and there is no reason that legal challenges would hold it up,' he said.

A Denying permission and prohibition

Use: an appropriate we rd or phrase from (he box to comp lete each sentence

ban block stand-off stand in the way of overturned held up

1 There is a government PrH? ....... On selllng urantum to foreigners.

2 The socialist government a previous decision taken by the conservative government

rslatlng to uranium mining in labiluka

3 The company has tried to. . attempts to stop it developing the mlne

4 When two parties prevent each other from acting and no one can proceed, it is a .

5 Greenpeace and ~he Wi~deroess Society hope to ERA's commercial exploitation of

traditional Aboriginal lands.

6 The mining company sees no reason why work should be

.. ,., for Legal reaso ns.

L l~~~_nershi~

B word families Complete the chart.

verb tc

regulate

decide

9 c •••••

permit

';wmfi1¥

noun ruling

3c judgment

adjective

A Llnderst a md\T\g matn points

Read the text below about a diamond mine in Canada and answer these questions. 1 Is the mine a commercial success?

2 When did BHP start to develop the mine? 3 Where .s the mine located within Canada? "'" Wh~t does the mine \n Caueca 2r,t~act~

Which groups did the company have to negotiate with?

4 6 B

approval 1t .

]0 .. '" .

Canada's Ekati ciiamond mille is a triumph of ccoperation.wntes Scott Morrison.

BHP makes a pipe dream come true

The Ekatl diamond mtnc sits alongside an important oartbou migration route- in Canada's desolate Northwest 'Fen-itcdes. Grjzzly

o bears and other wild animals are known to PC'lSS by cccasioually, but the region was rarely visited by man until Broken HiH Proprietary, the Australian group. began devel-

10 oping: the site almost two years 111ro.

The Iogtsttcal challenges of establishing 8 nunc in the remote region around Lac de Gras, some l!j 30{) kni north of Yellowknife. were compounded by an inhospitable

climate that can send tempera tures plummeting to minus 50 degrees Celsius. 'The mine site was

2[1 far Irom ideal and many sceptics believed hopes of extracting diaruonds Jrom the Canadian tundra were a pipe dream

Territorial officials and native

zs leaders acknowledge. that BlIP was quick to understand that [Of" the project to succeed, the luterests of the local population would have to be taken into account. The compa-

aonv spent several years negotiating with the territorial government and four native groups that claimed rights to the territory on which the dtamond-beartng ptpes

ss were discovered

Native ami territorial leaders

were very concerned about protecting the environment and demanded that the compauy

~{} divert waterways, safeguard

against environmental damage and maiutatc the: pnntv of small lakes at the mine site. III possibly the most contentious iSSlLB, gQV-

46 emment leaders demanded that BHP build a sorting and e .... aluanon centre in Yellowknife and sell

10% of 11Ie mine's output to buyers ,vi thin tbe territory. Native Ilfl Indians )'L,'j"B received training and jobs at the mine as well as financial compensation

FINANCIAL TIMES

World business newspaper,

Land ownershl'P I

B Comparison of the two texts

U~C an appropriate word or phrase from the text to complete each sentence.

Similarities

1 Location: Both sites are located in the . .. of the country.

2 Land ownership: Both sites are on, . . ... lands.

3 Company ownership: Both companies are ....

4 Government support: Both mines

5 Profitability: Uranium and diamond mines. are usuellv very

Differences

6 Location: The Ekati mine is in a ptacc where the temperatures are very.... . while the

Jabtluka mine is In an area where the temperatures are very ..... cc

Production; The Australian mine is for ... ,.

. ... while Ihe Canadian min-e is far

8 Cooperation: Native groups have been futlv con:;.ulted and agree to the development of the .......... , ,. ,but th e s.ame ~'S not true atthe .

9 Local interests; In ...... " local people will benefit from having jobs tn the mine and the

produce will be sold lccalfv, but in

........ this is not the case.

10 Environmental issues: The government and the cornpanv seem very concerned about protecttng

the environment in, , but Greenpeace and the Wilderness Society are very worried

about the future ill .

1 Compare and contrast the two mines from the 'point of vi ev ... ' of (a) the local people; (b) the mining companies: and (c) the Ie-g.J1 position. QUO[C exactly from the: two articles to support your ideas. Usc some of the following phrases to introduce quoted evidence

According TO ,.

GJvefllmem lcadc!·s S(lirl ... Native groups (l!"gucd

A spokesman Jor , .. s-aid .

2 Which of the two cases acknowledged the traditional rights of native peoples. most satisfacronlyi What marc should be done, in your opinion?

, '·"7 J In confidence

Discuss these questions

..._ Can 'fD'J thin\(. of S\tll at\\)rlS w\l€{~ )IOU 1~'2_.ed to be sure th at whai vcu say is in c_oP.fid€.rlce~ 2 What business situations can you imagine when conpdent.a .. ll'ty is a requirement?

l@tturttJ!ffilt

A Llndcrstanding main. points.

RC-Cld the contract all the opposite page and answer these questions. :l What is thiS agreement called?

2: Hem manV parties are invo\\i'ea in the \-etteT oj agreE-men\_?

3 What do the Corr oanv and Princeton have to do to show that they abide by all the conditions? 4 How many definitions are there in the agreement?

What will Princeton use tire information fot?

£. What happens if legat ~uthor\ti-es der-rano ro 'see the (;.onf\Ger'l)\<3~ tnfurm;;ttlon? 7 How long does the agreement last, if no ott-er agreement is made?

B How can the agteemeilt be chailged?

B Understanding details

Answer these questions.

,. ~3 Target Ent"!"pr~s'2:S th-e: "giv-er 'Of the r-eceiVN 'Of the ('i)nfid-e,n\\al ir.fmmatlon1 2 What does 'vour prior consent' allow Prince-on to do, in 1a?

3 Who do the 'representar.ves' work for - Princeton or Target Enterprises?

-'I Wilich clause mentions the possible destnictton of all the written confidential documents?

Which dolJse sets Gut the fact that nu finn CGl\trac_t ey.\sts to f\llaUse anV dee. and that Princeton [art stop the discussions at any time?

6 Which clauses explain when lntunnarion is not considered to be 'confidential'?

Is Prlnceton he"!? to use \nformatlDTl that rt acqulrec before signing th~s agr-eE:m~nn S Can it use information In the public domain?

9 Which four institutions are mentioned as possibly requiring the mrormarion to be disclosed? 10 How manv parties must agree and accept the letter?

Princeton

Target Enterprises, 186 Roydon Street, London SWl Date:

Dear Sirs

CONFIDENTIALITY UNDEIITAKING'

15

1 In consid-eration of Target Enterprises {hereinafter 'The Company') proviomg Princeton Limited (heremaner 'Princeton' 'us' or 'we') with information in relarlon, inter alia, to the business or the Company

and the posslbmty of a transaction relating to the 60 same (collectively, 'Confidential tntormattorr}, we hereby undertake to. the Compang always subject to paragraph 2 below. as follows:

a) We agree that unless we have obtained your prior written consent. we wil1 not disclose or pertnlt the dlsclosurc to any third party other than our Representatives (as defined in paragraph (0) below), the fact that the Company may be considering a possible transaetinn with us: of with other parties, the fact that certain information has 7(] been made available to us r-egarding the Company,

the fact that we and the Company are or may be engaged ~11 di~l;u~"ilJm; with respect to a P05!51ble transaction IJI" the status of such discussions; and

b) The Confidential tntcrmatton wnt be used solely for 'is the purpose of evaluating, negotiating, advising on

01' implementing a proposed transaction and win be

held in confidence by us and will not be disclosed to

any person other than such directors. officers, employees, agents, repr-esentatives and advisers of 80 Princeton group or companies (collectively, our 'Representatives'I

c) We will upon the written request of the Company deliver to the Company or, at our option. destroy all written Confidential Information provided to ill, including any ecpies. extracts Of other reproductions in whole Of in part, of such wr-itten material. We will, upon the written re-quest of the Company, use our reasonable end-eavours to destroy all documents. memoranda, notes ami other writings whatsoever prepared by US or any or our Representatives to the extent containing or reflecting or derived from any Confidential Intormatinn or any negotiations or proposals relating to any proposed transaction {'lWlevant Maledal').

d) In th-e event that we and/or any or our Representattves are requtred by law. regulation or by any requirement of any regulatory body or other government authonty to ntscloee any Confidential Information, notice of such fact shan be given to The Company by telephone or Iacsunlle.

20

1 This ls ar- abridged extract from .8. confidentiality agreement and, ,3_~ such, would not be: suitable rOT uar ;l~.;J. leg~l dOl"UIT1~N

i;} Unless and until a definitive written agreement is executed and delivered by us and the Company, neither we nor 'The Company shall he under any obligation to complete a transaction contemplated hereby and either we or The Company may, in Its sole and absolute discretion, discontinue discussions, negntlattcns or Clue dilige-nce related to any potential transaction; and

n The obligations of each or Th-e Company and Princeton imposed by this letter of undertaking shall cease upon the earlier-of the entering 'into of a bindlng agreement between The Company and Princeton am] the second anniversary of the dute hereof and

gj This letter agreement may net be modified or amended except ln the rorm of a wrrtten document €XQwted by the Company and Princeton; and.

se 2 The obligations on us under this letter of undertaking shall not apply:

aJ To any information lawfully in the possession of ourselves prior to the supply of the Confidential Information: or

bl To information which enters the public domain aner the supply of the Confidential Information for any reason not attributable to any actions of ourselves or our Representatives; Dr

t) Without prejudic€ to paragraph Ie above, to mrormatton which is required to be disclosed by applicable law or order of court of competent jurisdiction any government department or recognised stock exchange agency OI' other regulatory body or authority whether or not baVLni:

the force of law; or

(I} To Informattcn which is independently developed by us ether than in breach of thls letter of undertaking, 3 The Company agrees that we ar€ not liable for any costs which the owners of The Company, its directors.

S5 employees or their respective advisers may incur in relation to the di!5closure of the Confidential Inforrn;ltion or any subsequent negotiations.

4 Subject to the f'XP~S!l obligations. herein, we shall befree to usa the Confidential Information free of charge

90 and without limit as to time, ler:ritory or manner of dlsclosure. This letter agreement shall be governed by and construed in accordancc wtth the laws of England

Yours faithfully,

FOr and on behalf of prmceton t.tmited

Aereed and Accepted

For and on behalf of Target Enterprises Da.te:

l In c:onfJden<::e

Legal slid

An agreement or a contract have no standing in taw unless they are signed by all the parties named in the contract, and dated. A letter expressing an undertaking of confidentiality has as much legal force as a more traditional contract

Match these terms with tbelr definitions. Use a good dictionary, such as the: LongmalJ BU$I-mss E119lish Djctionary, to help YOll '1 rli5dtlse (\"me-1D) 2 reasonable endeavours (line 34) 3 execute and deliver (line 49) 4 aDSO\ute d\soet\o-r. (\\r.e 53J '5 potential transaction [line 55) 6 binding agreement (line 59) 7 CDmpeten' juri,llic\inn (Ii"" 76) 8 force of law (line 80) 9 liable (line 83)

A Legal terms

H Contract 1 anguagc

Match these terms and their definitions.

, ill consideration Of (line 1) 2 hereinafter (line 1)

3 hereby (line 7)

4 subject to (line 7)

5 at our option (line 29)

6 unless and unlil (line 1,8) 7 prior to (line 68)

B without prejudice (line 74) 9 in brooch of (line 82)

10 construed (tine 91)

a) r\ght to an In -a case

b) reveal

c) legal" uthority

d} possinle business deal

e) without influence or obligation

f) do sornettlng which causes expense

g) \~gallv respDo,ible

h) make every effort f) draw up and send n I~g,\ obligation

~ a) breaking the agreement

b) regarding the fact

c) 1101 affecting existing rights

d) in the absence of

e) before

f) from now on in this document

g) as a result of this document

h) on condition that

i) understood and Interpreted D according to our cboice

In confldance I

C Complete the sentence

Use an appropriate word from the box to complete each sentence

hereby hereinafter therefore hereto herewith

1 I. .h~r.e;p'y .... promise that I will not release any further details about the matter.

Signed: Mrs Green.

2 The two firms, Brite and Stockdale, agree Ihe following.

. _." referred to as the Holder and the Receiver.

3 please find ....

. ... three more pages that belong to the brief.

4 This. is an urgent matter and .... I ask you to Sign and return these papers as SOOtl as

possible

5 Please study the list of prices attached and reply immediately to my clerk.

D Use of shall in contracts

Legal E.ng1ishrs marked by the more formal usc of shaN in legal documents. Complete the sentences with the appropriate form of shall or will, and re-write each sentence in a simpler, more everyday sty 1..-:.

1 'Confidential tnfcrrnatton' . sh.:lll mean (Ill information disctosed.

Confident/ell informq/"ion means all informatIOn mad~ available to the readtl~

2 What time>

........ you be back this evening?

3 Nothing in this document ..

. be- construed as granting anv rights to the Company,

4 the Company promptly destroy all materials lf so requested.

5 If you carry the boxes, I . c. c c ••• carry the bags.

6 Princeton ..... . .. bear no responsibility tor the accuracy of the information.

7 What do you think he say when he hears the news?

8 The Company. the firm.

...... not make any reference to the materials wthout the permission of

'''muijm

1 Have you ever seen a contract, such as a marriage contract or a contract of employment?

Who signs them and what happens if the contracts are broken? Where canyon find examples of contracts to study' Try looking on the Internet, or at your local Citizens Advice office, or in your library. Research and make a short report on your findings.

:2 Imagine that you and a partner have invented a product Or service to sell. Write <I. lette r to you: lawyer, asking for some advice on d-swing up a simple, clear and casy to understand contract between you and your partner, since you have only have a verbal agreement.

I .. '8 J Licences

Discuss these questions.

1 How do international companies organise- the production of their goods outside their own markets?

What alternatives do they have 1

2 Have you ever bought a drink with a famous brand name, that you know has been produced iocallv?

How many brand items can you think of that are made under licence in your country?

3 Apart from famous brands ot dorhlng or drinks. what other kinds of business may be performed under licence·:'

A Understanding main points

J{~Jd the extract on the opposite p"ge from it licence agreement between nNO publishers and answer these questions

:1 What kind or publlraticu does this licence agreement permit the Publishers to produce? :2 When does the agreement come into effect?

3 Can the Publishers make any changes to the ortgfna! version?

4 What assurances do the Proprietors gIve that lhere will be no legal probterns with copyright? :5 IF the ucence IS to be extended 10 other parties, what must be done?

6 Call the licence be renewed by only all€' party?

7 What action must be taken if there 15 a dispute about the agreement? 8 In the worst case, what w111 happen rr the parties cannot agree?

B Understanding' details Answer these qLl(:StlDJ1S

1 Is there any reference to p.Jy'ment in the agreement? If so, which clause is H in? :2 What do they and it refer to in lines 18-197

3 What is meant by thi5 worrcntv in line 3f~

4 What are the rfghts and liabil~ties of t-re parties in line 40?

What does the same refer to in line 407

6 What is an umpire, as referred to if) line "427

7 Is there any dfffetence ill the text in clause S between difference and di:spute~

8 Whot two phrases are used to show that the 1996 Act may be changed in the f"Me?

MEMORANDUM OF AGREEMENT

made this day of 2D

Between ...... or; . ...... (hereinafter termed the

Publishers) of one part and .. of .

5 (hereinafter termed the Prcju-ietcrs) of the: other part 'i;\'HERE.'\S the Prcpnetors are the proprietors or a \VQl'"

entitled' (hereinafter termed the \<Vork).

NOW IT JS HEREBY MUTUALLY AGHEED AS FOLLO\;"S:

1. Subject to the terms detailed in this Agreement, the Proprietors hereby grant to

Hi tile Publishers the exdusiv""€ licence to produce and publish 1'1. slngle printing of lG,OOO copies only of th-e Work 111 paperback form in the English language under the Publishers' own unprmt' (beremalter termed tile Licensed Edition) tor sale

throughout ,. only. 'I'lns restricted circulation is to be clearly indicated on

the outside of the cover and on the; reverse of the title llag-E? of the Licensed Edition

l'i- by the tollcwtng words: "Licensed fnr sale in only: not for export."

~, This agreement shall hot COme Into (:ff~d until the: Procrletors have received the (arlvauca) payment detailed in Clause.a hereof.

g. The Publishers shnll produce- the Licensed Edition at their own expense, 'TIley shall cause it to be reproduced faithfully and accurately and shall not abridge.

2lJ €:qxmd Dr otherwise alter the work, including- illustrations where applicable, without the prior written consent of the Proprietors,

<I, Should the PUblishers fail to Issue the Llcenserl Edltron within 12 months from the data of this Agreement all rights granted under this Agreement shall revert to the Proprietors without prejudic€ to any monies paid or due to the Proprietors

~5 5, The Proprietors hereby WRn'R11t to the Publishers that they have the right and power to make this Agreement and that Recording to English law the Work ,vill ill no way whatever give rise- to a violation of any extsung copyright! or a breach of arry existing agreement aud that nothing in the work is liable to give rise to a civil prosecution or to a civil action for damages or any ather remedy and the Proprietors

30 will indemnify the Publishers agamst any loss, injury or expense arising out of any breach o{ this warranty ..

6, The Lit.'~11Cr;. hereby granted to the Publishers shall not be transferratl in whole 01 if) part Or extended to include any other party nor shall the Licensed Edition appe~n' under any imprint other than that of the Publishers, except with the prior Written

:15 consent of the Proprietors

7, The Licence herein granted shall continue for a period of five' vents from the date of first publication by the Publishers or the Licensed Edition autl tbereaf'ter may be subject to ren-ewal by mutual agreement between the parties hereto.

S, 11" any difference shall a.rb€ between the Proprietors ::U1d the PUblishers roucning

;10 the meaning of this Agreement or the rights and liabilities of the parties hereto, the same shall be referred to the arbitrationof two persons (one to be. named by each part}') or their umpire. in accordance with the provisions of the Arbitration Act 199B or any subsisting statutory ruodificatiou or re-enactment thereof provided that any dispute between the parties hereto not resolved by arbitration or-agreement shall be. submitted to the jurisdiction of the English courts.

! a pl!bii~ll~r's tradcm« rk 2. llm,llly" the fust pa!l<= in the book

Legal brief

Copyright IS a legal term used to show the rlgf-ts of ownership of creative ideas, original[y'fof published literary works but later extended to include such things as musk and motion pictures.

New legislation is now needed to deal with the increasing use of the lnternat and issues arising from abuses of intellectual property rights. I n the EU, copvrfghr protection lasts for 70 yea rs after the death of the copyright holder. There are criminal penalties for infringement of copyright.

A Definitions

Match tuesc legal terms horn the ucencc agreement with their cefuutions

1 memorandum ----------- a) glve

2 hereinafter terr-ier; ~ b) change

J subject to ~- c) written record

4 gr. nt d) lim ited to

5 exclusive e) sa-caned 'In the agreement alter this definition

6 come into eftect f) depending on

7 abridge, expand, alter g) return to

8 prior written consent h) concerning the interpretation

9 revert to i) breaking the law of authors' rights
10 without pre-Judice to any monies paid j) legal authorily
11 h erebv warrant k) guarantee
'2 right and power I) will be sent
13 violaficn of copyright m) regardless of any payments made
'4 touching the rneanlng n) will be applied
15 shall be submitted 0) previous written perm isslon B Complete the sentence

Use an appropriate: word or phrase r rom Exercise A to complete each sentence,

1. The agreement speu'tec that the Propnetcrs were legally entitled to the awner~h·lp OT all ngt.ts 'm the book. They had the .ri9nt.r!r;.<JJ'QYfY· .. to make the agreement

2 sookb'nders lnc c. ..........•....... the Publishers) and Jones and Company (....... .. Ihe

Proprietors) hereby mutually agree the following.

3 This agreement is for five- years and shall

4 The rights granted in this agreement are ....

..... after the agreed payment has been made. to the licence holder.

5 No changes shall be made to this agreement without the .. of the Proprietors.

6 IF any dlffere nee 5 hall a rise between the Proprietors a nd the Pu bush ers .... of this

Agreement, the same shall be referred to arbitration .

.............. " ... the satisfactory performance of the licence holder, this agreement may be renewed. 8 Should the licence holder rail to fulfil all the requirements of the agreement, all rights shall

.... , _. the Pro prletors.

( Word search

Replace the underlined items with words and phrases from the text that have a similar meaning. 1 This agreement is issued by the owner> of the right5c Propneto:»

2 The terms are des~dbed in this agreement.

3 Publishing this book will t;_ertainly not cause any legal difficulties for either party. 4 The Proprietors will QIQ_tect the licence holder against any expense.

S The agreement mav not be Q_1_ten~q __ to involve any other person.

:1 Prepare a business letter to a law expert asking him or her to explain the licence agreement in simple terms. Make specific reference to the points you do nat understand, such as thearrangements for arbitration.

2 Think about the licensed goods available in your country. examine any examples you can find and list the physical signs you can identify {on labels, or an packaglng, 1 naide or out) that II licence has been used, Or perhaps nor used, legally, Then write a brief report.

I~ _2_J Fraud

1=$hHil·tiii¥f._

Di;c,"Cus.:,. tuese questions

1 How does an investor find out about new and exciting opportunities? HOw reliable do you think investment advice avaltable in newspapers is!

:2 'Money for nothing' and 'get rich quick' schemes are often really confidence tricks. Has anyone ever suggas-ed that you invesi ill a particular scheme?

Reading tasks ,

A Understanding: main points

Read the text on the opposite p3ge about J gold mine fraud and answer these questions. 1 How much gold did B(e-X. saV they had tounc In tndcnesta back in February t996?

2 What was !f1e marker capltallsatton of Bre-X before the scandal?

3 Where are the courtroom dramas being played out?

4 How many investors are being represented by lawyers against Bre-X?

5 Who do the PfOsccuting lawyers think should be held accountable forthe fiasco? 6 Why is the case so critical to broce-ages in the US?

7 15 this case setting a precedent if the inves.tors win?

B Which firms are accused of being involved in the fraud?

9 WI1ZlI is the Canadian gold producer Barrick accused of doing? 1.0 Why don't the cheated investors Sue Bre-X?

B Inforrnarlon search

Look quickly at the graph end da1CS on the- opposite pa,~e and answer these questions 1 Wll.at was the basis For the belief that there was a hlJge gold deposit in Busang-~

2 What did the exploration predict about Bre-X?

3 What happened 01119 March to Mr Guzman?

4 What happened tc Bl'E!-X snares on 26 March"?

5 Why did the [om purer crash On i Aptil?

6 Whir.h organisal.iun revealed they were inve stigallng Bre-X Oil 3 April?

What evidence was there that there was no gold after all?

Bre-X Minerals drama continues in the courts

It is now some time since the Busa~g gold deposit was revealed as a ~oax. Scott Morrison examines the effects an the mining Industry and the legal battle still being fought by investors

More. than thrs€ "" have pa"sed smce Bl'e-X l\-ilnB.1"!lS' pVrj:101"ted. 7Jm ounce gold deposit ill Indoucsla

e was unrnasked as nothing more than an elaborate hoax.

when the dust settled. the Canadian company's C$5!Jn (US$'1,2bll) market capitalisation 111 11m] been "'Lped out ann Bre-X's. worthless shares were de-usted. 'I11€ drama, which unlclded first ln the j uoglcs or Borneo and later 011 ill stock markets in North

ia America, is now being played out in courtrooms in 't'orontc and in a remote, corner of 'Texas, where lawvcrs nave launched luwsu! ts seeking billions of dollars in dam-

so <11;8-8.

whtle there i5 little doubt that

Bre-X perpetrated D massive scam. The legal actions pit small cealed materially adverse facts

lawyers represeuttug some 2,000 luvestors against ntne of" the top Barrick claim it was prevented

investors 5BY the companv and its brokerage house~ill North?() from disclosing- the results of its

2f1 directors are not the only ones to America. The case alleges tbat due eLi ngence because it signed a

be held accountable. 'l'h~ lawsuits 00 brokerages were negligent in issu- confidentiality agreement.

also allege that several brokerage lug misleading statements. pro TI. is far n-om clear that plamtltl

firms Issued false and nnsfeadiug claiming' tile company's Busang artomevs will succeed in thetr

reports about the Busaug deposit !told deposits as the largest in the 7!', attempts to hold brokerages liable

:1{1 and prolited from their assrciattou worfd, antl that they ~IJf,O partici- Jor the Bre-X nascn JJ they '>1.1(,:-

with the company. 'I'he plaintiffs' 5:5 pated in '3 fraud on the market', a teed. it would be the first tnne leg-

al'glJ.l118IJJs, if they are successful. procedural docttlnc under US law. Islatlon agajils't Ialse advertising

could set a chiuing precedent [or However, a renowned securities was applied to securities. Many

the entire brokerage mttustry law expert tn the US has said that !!0 observers say they hose httle

3..~ In Canada, the efforts of extending responsibjhty [or fraud choice ether than to sup. deep-pock-

investors to seek redress took a flO to 'al dNS ann abettors' - in this. eted brokerages that promoted the

S':ign~fic&l'lt .t;;t-ep fonwl-t-d in [I'l'arch case il'l'e brvk6'C'W;I2S I}~a! reCOLll- stocK, beL'iHISe- Bt'e-X it.se!f is l:mrdr·

wheu a [udac ruled that plaintiffs .mencl~d Bre-X stock. - would prove rupt and company instdcrs who

could proceed wtth 0, lawsuit difficult. The US lawsuit also ~5 profited from the freud could not

40 against Bru-X, its offfcials, engt- allegas that Ban-ick, the Canadian cover billions or dollars tn claims

neering Ilrms and brQkel'~gB hous- 65 gold producer that tncd to negoti-

es. The defendants have said they ate a partnership With Bre-X, dis-

~s will appeal the ruling. seminated fals€ statements Or (:011-

0_

30~----

o ... ~ t~ .:iI","e~f" ~~.~~.!r~"""",I(;,'Jet='''' ""rl":<JuL·:.r'''''''~··~''tl~ll;r,~n,]~f''?;1I' ,.i:""",,,I~ a5~\1'-:o."'~:·w ~JI.n~"·[rl(' \it.1 IhC1~"'!_$'i

25

O~t,ICI"""'G~."<"'I,::>"=.'~'''X:II~I''''''~''"'':'''' ~ ~~. -..- :l',I:1 ~·.;I'J·=d"\5r i""".,",'" ;;O:_1,i<j "1.;10';:;.,_" " .. ~I rr"' • ...,;:,'I:i; ~~" n"'II"""~II~iss

€J ftl~ ::.::;'~:'~~~=~ ~~~"I~~~~hJ~\):I"-;

15--

€It M~r16(."'1; I·U'_' ... c-o a: ,.nc..:: CI !:7-.\·X:·lJ.i% ·-,-,1 ·':>'.':l.'i~:';',·I:;"'J1, =-,-,.; uS ~HUl(' ' •• ~c:: ··.,,'."(:r""JJI""~r':''''''~I:l..~~tl'~0:D':l'.: ,:~:.<.,; :.': 'r-=:-~~'-'~_"",~-I:<~~, ,-':!p':~ ~n::.-c.

@;,pr 1 :"T~''''' S·,-;,-" 0;"'.,JUt"('j'(~~.'.' ~.;T':'''no :·r,.~'T'(-F"'··::"'?~_' ~~1\t1!,~~,.,..'1r>1~8-::;,/-.

o .~~j 3 \.,_~; n' f,...,. ,~ I "r,?J _!a'm; ~_'.lJ2i 1I'Er~ -("c'-' 1\=<1 i-....,-",I\~'!r!j ~~-~ ns< ~"--.n::r,.--cJJ'"

Hl96

if) '"'~~ S ry-LL); 1..~¥.. ::"'<; ;;';:' ,~~~,,,..,.-:: e.c,1: ..... .,~.'('f'J:l~~J

,995

FINANCIAL'TIMES

World busrness newspaper.

A Words relating to fraud

Match these terrns i .... ith their definitions.

1 purported ~ a) people in a company with access to privileged information

2 unmasked '~---- b) said to be true, but really false

3 elaborate

4 perpetrate a Scam

5 false and misleading reports 6 proclaiming

7 fraud

8 claim

9 fiasco

:10 insiders

c) crime of deception and deceit

d) say something is true

e) complicated

f) disaster, a tailu re

g) "announcing publicly

h) revealed as false

I} carry out a dishonest scheme (0 make money j) inaccurate statements

"Ah, fv1r JtnKins, you're probably wondering about those mining shares / fold you to buy lelM month.

B Legallanguage

Match these terms with their definitions.

1 damages - ~ a)

2 accountable '----~-- b)

3 precedent c)

4 seek redress d)

people who bring a case to court financial compensation

people accused of a crime in a court case case that sets rules

5 plaintiffs e) sue to regain 10505£'5
6 defendants f) promise to keep something secret
7 negligent g) having to explain and [ustlfv
8 due diligence h) legally res po nstbte
9 confidentalltv agreement i) thorough check
10 liable j) not do a job professionally C Word search

Find a word or phrase in the text that has a sirnilar meaning.

'1 take a bankrupt company's shares off the stock exchange (para 2)

dy.~.Iisi

2 firms that buy and sell st-ares on behalf of clients (para 4)

b .

3 people who have only modest amounts of money to spend on shares (para 6)

S ccn"., i ....

4 when a company deliberately misleads the public (para 6)

p " inaf on the m " .

5 people who help each other to commit a crime (P<H1I7) ....... and a

6 government bonds, holdings. stocks ;)nd shares (para 8)

2_ Do you think the small investors will win their case in the gold scam? On what grounos. Arc there other factors. to stop srna 11 groups winning against bigger ones?

2 The chart shows a dramatic rise and fall in the share price of Brc-X Minerals between June 1995 and May 1997c Read the eight-point diary by the chart and then describe what happened. Use the past tense to tell the story.

'lim!.".);

"'" 1 ] Telephone crime

':Q',lij'I,I1.iii,_i

DiS(US5 these questions.

1 How many telephone calls do you make every day? Do you have a telephone calling card?

:2 How often do you call someone llvlng outside your country? Are these personal or business calls?

How do you pay For such calls?

A Understanding main points

Read the text on the opposite page noout cetephone fraud and answer rho:::s~ que-StrOM:'>. 1 Who pays the bHls when there is telephone crime?

2 What is B1's calling card division?

3 How much does telephone crime cost operators a year?

4 How many fraudulent calls are made each year according to trade organisations?

:5 Is telephone crime m8.inly committed by professional criminals Of bored youngsters? 6 What is the simple-st example of telephone crime mentioned in the text?

7 How does BT plan to protect itself from fraud?

B How has new technology helped BT solve crimes?

B Understanding details

What do the following figures refer CO in the text?

1 $334m 2 55.000 3 400.000 4 [2m

5 nom

C Complete the sentence

Use an appropriate word from the text to complete the six stages of a telephone crime.

t A criminal has to open an Q(C:9P!?!..

2 Next.he has 10 give a .« .. «" name.

3 The crime consists of making contact with people who need to ... a lot of expensive

phone calls but have little money.

4 These people agree to ..... . ..... the criminal in cash for the calls they make - not the real

costs of course, much less.

The criminal then sells hundreds of long- .

p hone calls - to Australia, fa r exarnp le,

6 However, when the bill is .

. ... at the end of the month, the criminal disappears

Telephone u~~~

FINANClALTIMESMONDAY JULY 6 **

B1UTAIN

BT launches fresh attack on phone crime

British Telecommunications roT) is mounting a. new offensive against the barons of organised telephone crime who are costing it

5 hundreds of millions of pounds annually. Its chief weapon is a new technology that can cut the time to detect and prove fraud from-in some cases - year" to minutes.

10 Developed with BT's former partner, Mel of the US, the system has already been tested by BT's calling card division, where it has doubled the number of frauds spotted and

15 halved. the financial lasses. Now it is being deployed across ET's business services.

The level of UK phone crime is hard to assess. but it is costing

2Cl operators a minimum of £200m ($334m) a year. Trade organisations put the Itgure at 55,000 crimes reported, with a similar number of unreported fraudulent

25 calls . And forget youngsters and amateurs: telephone fraud is bigtime crime, Some of the UK's bestknown villains are defrauding the

. _"..:r

Vocabulary tasks

operators to fund activities rang-

30 ing from drugs to terrorism, according to Dennis Dotts, head of BT's investigations unit. 'This Is more than stealing lOp from a call box: he says. 'Notorious tudivtdu-

35 als in the criminal fraternity are involved. They know BT's network and they know what they are doing:

'Telephone crime can be absurd-

4(1ly easy. Opening an account in a false name and selling calLs to international destinations before disappearing when the bill is due is one of the simplest. In one case

45 earlier this year, a gang of Tamil sympathtsers siphoned off or diverted some £2m from 400,000 fraudulent cans to Sri Lanka before they were arrested. con v -ict-

50 ed and imprisoned.

It took BT's investigators two

years to collect the evldance to put large corporate- customers.

the gang on trial. The new system,

called 'Sheriff', will be able to do

5.5 the job in minutes. Detection

involves analysis of hundreds of millions of call records looking for

unusual patterns: an unexpectedly World bu.sioe.u rHlWllpapur.

'1""--0:< ..... ~~"' .

large number of cans to a particuG{I1ar number or dcsttnatton. for example, or calls made at unusual hours or from unusual locations.

BT's fraud strategy manager said the company's services were

65 already protected, but by individual systems. The need was for 8. single system so fraud alert data could be shared across product lines.

70 Sheriff uses artificial tntelltgence for analysis and .an advanced 'coject-ortentated' database from Versant, a US company, to provide the speed and reliability

7S needed to sort through a minimum of 120m calls a day on BT's network. The system 'learns' f1'01h its experiences, so hnprovlng itsability to d-etect future frauds.

8Q BT is consldaring offering a tatlcred fraud-detection service to its

,

1

FINANCIAL TIMES

A References

Who or what do the underlined words refer to?

, ",bQ are costing (line 4) the barons of organis ed telephone crime

2 Its chief weapon (line 6)

3 where ~ has doubled the number of frauds (line '3)

4 This is more than stealing 'rep from a (ali box (line 32) 5 the-y know what they are doing (line 37)

6 before thgy were arrested (I i ne 49)

7 it, ability to detect fraud (line 78)

8 to its large corporate customers (line 81)

B Word search

Replace the underlined items witb words and phrases. from the text that have a. similar mean ing. " BT is preparing a new attack against telephone fraud. (para j)

offHI~iY~ ..

2 The system has !Dcreased thejiurnber of detected crimes. (para a)

..... the 11 •.••••••••••••••• off s

3 Telephone fraud js~eriou5. (para 2)

b.. . .... -t.. . .. (

4 One form of the crime is seWng calls to others and W_en failing to meet' th~. (para 3)

d...... . w 'hc c.d· Ihe b.. . is d ..

S BT -e~perts IOO'r:. two yeClfs to H'i"\(\; enough e\'\d'C:\"l(_~ to take the- crImInal:;. tn l.omt. (pa~a 4)

p........ . .. Ihe g. . on t. .

6 The system uses an _g.dyanced computer programme that identifies patterns of coW._s. (para 6)

.. 0., _-Occ

........ d

The company may offer a fraud-detection service to its business customers that is speclalt_y designruor each ("stomer. (para 7)

t.

C Complete the sentence

Llse an appropriate word Or phrase: from the box to complete each sentence.

detect prove barons of organised crime fraud false name evidence arrested convicted imprisoned

1 It is one thing to .. ,q~.t.e;(.t fraud, it is quite another to

2 Telephone +h •••• IS sa~d to be In the hands of

3 The police cannot prosecute a criminal without

4 One gang mar aged to steal rnillinns before they were

...•...... it.

...... and

Opening an account in ace.

. .... seems to be very Simple.

D Definitions

Match these terms. with their definitions.

1 siphon off and divert \ iii) hold someone at a police-station

2 arrest ~ b) implement a serious campaign against an enemy

3 convict c) move part of something without the owne- knowing about it

4 imprison d) put someone in prison

mount an offensive e) frnd someone gUilty of a crime

Word fields

Write these words in the appropriate columns.

murder arson robbery assault fraud forgery perjury burglary money laundering rape kldnappir g bribery blackmail

crimes against people

....... fI.IW4?r: ..

other crimes

. RrMn .

You discover that a colleague at work has been involved in telephone crime - she has opened an account 1 n a false name and is sell ing calls to other office workers. Write a letter to your boss explaining what has been going an) and how you discovered it.

2 'Or,gani~ed crime' - groups of notorious criminals - are involved ill telephone crime, according to the text. What can international pollee: forces do to prevent their activities? Think about such things as cross-border cooperation, sharing of information, developing specialised technology (like the call monitoring device Sheriff), and list the actions that could help stop international telephone crime.

~ Money laundering

,<rnuhJ9Ui'i¥"M

Di'ic"Us.s these questions

1 1_5 it easy or difficult in your country to cor-real financial trunsacrions from the 'tax man'? Is there a strong 'black' economy?

2 Are you farrullar wltn the concept of~launderhlg' money - turning 'dirty' money into 'dean' funds?

Where does the 'dir tv' mcnev come from? Is it always criminal 13ctivity-? 3 Can bank transfers conceal stolen or embezzled funds?

A Llnderstanding main points

Read the text on. the opposite page about hov .. ' organised crime uses the international banking system to hide its money and answer these questions

1 Where did the pollee arrest the Mexican money taunderers? 2 How many people Were arrested ill total?

3 Wnat W'dS tjperat'nn Casablanca cle:s\grred to GO?

4 How much drug money is thought to be laundered world-wide every year?

5 According to the UN Drugs report. how much is the illegal drugs business worth every year? 6 How much can be recovered through anti-laundering measures?

7 HOI{fI is (t that mme and mote manev {ali hr, l~mnde red? \Nhat s.yst~ms me used" B Do criminals have to abide by the same rules as legitimate bank customers?

9 How do criminals hide [heir tlnancia! transactions from officials?

10 What are the legitimate reasons for b-=ink secrecy?

B Understanding details

Answer these questions.

:t What is meant by megobYle money?

:. What are aggregate funds normally used for?

:3 Wh-y oO,UN Dffitia~':'i want to make bi:ln~~ng riskie-r? 4 Who are the shareholders and berle/kiaries?

5 What is meant by J wolkln_Q account?

6 Why has the number of banks increased so much?

7 What must a bank half€- in mde~ to be. es.tablisne.d, In certain plac.es? 8 What is the favourite way of transporting Hlegal Funds'?

9 Why are casinos 50 popular for money _Iaunderlng?

10 Wha.t rail t'ne casino offer to do wtth the 'wjnnings'?"

Money laundering J

World banking system is a 'money launderers' dream'

disguise the ownership of assets by setting up shell companies and offshore trusts in jurisdictions where no Questions are asked

m:. about shareholders and beneficiaries. Many accounts and trusts are known as 'walking' Ones, where there is J standing instructlou to session of the UN General move the accounts to another Assembly On drugs In New York, 1.00 jurisdiction at the f:irs.t sign of

With the growth of the interna- inquiry by the authorities

tiol1a) drug trade, mQr~ W-gollctJ UN oWdals accept thJl com·

so money is being Iaundarad than mercial confidentiality, legal tBX

ever, partly on the back of elec- avoidance and the easing of capt-

tromc banking and the increasing' 105 tal transfers at low or nil tax rates

globalisation and speed of opera- are legitimate reasons for bank

non of the international Iinnncinl secrecy and disguising corporate

ee system. ownership, but they say the sys-

Cashless transactions, electron- tem is too lax in some places,

ic trading and computerised clear- 110 allowing Innltratlon for illicit or

ing mean that what the report nefarious purposes. 'One of the

calls 'megabyte money' can be most striking- thing's about off-

60 moved anywhere with speed and shore financial centres is the euor-

ease. With 700,000 wire transfers mcus increase that has taken

worth $2,OOOhn every day, the 115 place in (be number of banks.'

report says it is 'a reasonable says the report. Banks can be set

guess that 0.05% to O.l % contain up with relative speed and ease

G5 laundered funds to a value of and a mtnunurn of due dtligeuce

$3QOm' And even though hall the Investigation, so long as they meet

total volume of truusacttons are lZ(J a basic level of funds, which can

bank-to-bank transfers Of 'aggrc- VOlTy between one jurisdiction and

gate funds' for settlement or loans, another.

'HI the report says the 'complicity of Exporting bulk cash. usually rn

corrupted bank employees' SLOO hills and sometimes carrier!

ensures these also containlaun- 12.'i under dtplomuttc cover, is the:

dered money. 'This system is a favoured method of getting

money launderer's dream.' deposits to banks where- no ques-

15 The one thing law enjorceruent trous win be asked. Casinos in off-

officers have On their aide is that shore centres ore a favourite for

criminals hove to play by the rules 13Q converting funds: cash j8 of the system 111 order to use it. exchanged for gambling chips, the

While it is impossible to spot launderer plays. for a while at th€

SO transactions in progress once tables then exchanges the chips

money is in the system, criminals back again. Instead of a cheque,

have to risk exposure in putting it 135 some casinos offer immediate elec-

there. UN officials want the Ironic transfer of 'winnings' to an

process made riskier; offshore bank account.

S5 At present, criminals reduce their risk by cperattng through offshore Iinancial Dalt(H:I!,' wit'h lax

financial regulation and poor banking supervision. 'l'bey also

so hide behind banking secrecy, and

Report says the ease and speed of 'megabyte money' make it simple to conceal crooked cash, writes Ian Hamilton Fazey

I ~ was the biggest money launderLl1g investigation in US lustcry Evldeuce had been gathersd secretly ever many montlls by-

Ii undercover officers risking their lives. 't'he suspects were lured to Las Vegas [or a conference on money laundering. Then the police struck, arresting 2,2 banking uffi-

10 ciuls from Mexico's largest financial institution, plus 14 alleged members of Mexican and Colombian drug cartels and anether 70 linked to them. Seizure war-

Iii rants were issued to recover $122111 (£73.m) from bank accounts in the US and Italv, to add (0 $35m selzed so far. Tho ·operation so damaged confidence in Mexican banks that

2(1 their shares fell collectively by 4% in panic selling.

But as Operauon Casablanca struck its blow ill tile Americas, officiols of the United Nations

25 Drug Control Programme in Vienna were editing tile final verston of a report - to be t'BleRsed soon - that puts the US h-lurnph into a gloomy perspective

,110 It says that at least S:2.00'Du of

drug money is laundered every year. but \II lth the illegal lnternational drug trade valued at $50Qbn. this is probably a conservative

35 estimate. in a good year, l.IP to $500m will be recovered through anti-money laundering measuresan annual success rate of about a Quarter of 1 % of laundered funds.

40 Operation Casablanca, with

S157m. will probably make the rear· a good one, Gut lmi"'illy vintage.

The report has been prepare-c) by 45 a group of experts for a special

FINANCIAL TIMES

World business newspaper.

l Money laundering

I'lf!1@@mN

A Word search

Find a word in the text to complete these phrases.

1 m .Qnff. laundering (pa ra 1)

2 seiaure w (para 1)

3 f ..••••••

4 r . .

[ ..

.... versio n (para 2) estimate (para 3)

. .-g........ . money (para 4J

6 e trading (para 5)

7 nsk e.. . (para6)

8 L havens (para 7J

9 c .....••............ confidentiality [para 8J

,"0 c. tTailS~N-S (para B)

11 0 ,,, financial centres (para 8)

12 gambling c (para 9J

B Definitions

Match the pnrascs from Exercise A with their defini tlons.

1 disguising criminal money by concealing its origins .mQj1t.t./a.lJndYin9 .. 2 keeping business secrets.

3 in danger of discovery.

4 papers authorising the authorities to take money or property ....

moving large amounts of money from one place to another c

6 buying and setllng thtough computers .

7 places where laws and lax are especially lenient

8 finarctal services located in small countries. or on islands .

9 minimum guess " .

10 publishable farm .

11 money obtained illegally .

1.2 tokens. for playing in casinos .

Money launderir.g I

C Scrambled words

Use the definition'> in the first column to unscramble: the words from the text.

1 washing and ironing unindrelag .rql}n4~:rirJ9 ..

2 attract or tempt rule , .

] supposed to be- true, but not proved 4 get back

"5 harm

6 depressing 7 identify

8 hide something by making it look different 9 illegal

10 wagering

I.Hjui,.Ji

dgladlee vecorer r-raadge moogly tops guisised clitili laminbgg

1. Write a short description of how money (an be laundered. What kinds of activities lend themselves to the ei3-5y dispose. of cas}. into legitimate business'

2 Read in the press any new developments on this theme) and comment On them to your class or write up a summary

Medc<lD protesters pretend 10 wash amI lmn mDne~ as aart of tbelr &am~aigrl ilgairlsl m~ney laundering

.. -12j Cyberspace fraud

Before you read :

Discuss these questions.

1 I-:I-ave: 'YOU evet bDl~ght anyt\iing tr.ruu'gh the ~i)t~rnet~ li so, 'J.ir.al did 'JiD\J buy? 2. How did 'tQU pal{ for the goods you bought? Dld you receive them safely?

3 What guarantee did you have that you would get what you paid for?

'i$mW1£

A Understanding main points

R~ad thl:- text 0)\ the -C:PPOSlt-<:: p<'lg~ about ~nttrnet fracd and answer theve q\.l~stt'O~lS. 1 Wh at are th e rna in types of invcstme nt fraud reported in til e text?

2 How does the text define cvberzpocet

3 Which four uses of the Internet does the text mention?

4 Anonymity - not being Identified, Or traced by your real name ~ is important for criminals.

How does the \llt'2:me\ he\,p them 1

5 Which organlsations cculd vou lntorm if vou Were a victim cr e scam On the Internet? 6 Whidl crime has increased mnst in the last year Of so. according to the text?

7 Do most victims of fraud USE' traditional payment methods?

8 What does the acronym IFW stand for?

9 An escrow service IS a safe way of paY-lrlg for mterr et transactlons. 'How rices tOls worK?

B Understanding details Answer tuese questions.

1 How do households :get exposed to fraudulent schemes in cyberspace?

a How can the price of stacks and shares be easily manipulated over the Internet?

3 What are the five most common types of Internet fraud. according to Internet Fraud Watch? 4 Marj and telemarketing fraud pre-c'ated internet fraud. True Or false?

Are cyberspace frauds reettv any different from frauds rornrulttsd through more traditional ccmrrtunicaticn chaot1ets?

ONLINE AUCTIONS NAMED THE NUMBER ONE INTERNET FRAUD COMPLAINT FOR 1998

Cyberspace fraud I

Cyberspace fraud and abuse

Unwa.ry Investors ar€ in -dEl. nger today of being taken for a ride on the tnformatiou superhighway.

State securities regula tOTS around the US are concerned about the explosion in illicit investment ach e mea now flourishing on commercial bulletin board services and the informal web of computer networks that make up the Internet. Households that already have access to online services are being exposed to hundreds of fraudulent and abusive investme-nt schemes including stock manipulations, pyramid scams and Ponzi schemes'.

Cyberspace, as the online world is known, has the potential to educate investors and help them became better consumers. Any computer and modem is a few keystrokes away from research data and financial news. However, State securities regulators emphasise that the problem of illicit and abusiveonline investment schemes has the potential to spread like wildfire through the Internet, using increasingly popular commercial bulletin board services, Ifve discus-sion groups (chats). e-mail. and information web pages, alI of which ran maintain the anonymity of cyberspace, This is exploited to the hilt by those who promote fraudulent investment schemes.

New frauds are emerging, too.

According to Internet Fraud Watch, complaints about fraud on the Internet have risen 600% since 1997, and online au-ction complaints were the number one fraud complaint only one year Iater, a dramatic rise. The majority of payments in these fraud eases were made offline. by cheque or money order sent to the company 'Requesting cash is a clear sign of fraud. Pay the safest way. If possible, paY' by credit card because you can dispute the charges if there is a problem>' says the Director uf Internet Fraud Watch. l.FW recommends that buyers use escrow services: they take payment from the buyers and only pass money along to the sellers after verification that the. goods or services were satisfactory. Some auction companies have nrogrammes to insure transactions

The top 10 scams were, according to the National Consumer League: 1 Web auctions: items bid for but never delivered b)' the sellers. the value of items inflated. shills" suspected of driving up bids:

2 General merchandise: sales of everything from 'Ivshirts to toys, calendars and collectibles, goods never delivered or not as advertised;

J Internet services: charges for services that were supposedly free. payment made online and Internet services that were nE!V~T provided or were falsely represented:

4 Hardware: or software computer equipment: sales of computer products that were never deltvered or were misrepresented;

5 Business opportunities 1ike multi-level marketing or pyramid schemes, in which any profits were made from recruiting others, not from sales of goods and services to end-users;

6 Business opportunities or Iranchises: empty promises of big profits with little or no work by Investing in pre-packaged businesses or franchise opjmrtunlties'

7 Wo;k-at·home plans: materials and equipment sold with the false promise of payment for 'piece work' performed at home;

8 Advance fee loans: promises. of loans contingent on the consumer paying a large fee In advance. Once the fee Is paid, the loans are never disbursed;

9 Credit 'repair' fraudulent

promises to remove accurate but negative Information from consume- credit 1'€l'lort.s;

10 Credit card issuing: false promises of credit cards to peeple with bad credit histories on payment of up-front fees.

1 buyers are persuaded to Invest money in dishonest 'businesses' in return for premises of quick profits

2 someone who cooperates ln an auction 5~.J.m by pretending to want to buy goods and ill rai.s-ing the blds

legal brief

The National Fraud Information Centre was set up in 1992 to fight telemarketing fraud. In 1996 the National Consumers League in the US decided to expand its efforts to cover fraud in cyberspace. B-; (c'i'ltatt\ng th-e: W'2:bsite: at www.fnl.uu . .Ur-g.C;D.y~ .. urners fiOm a~\ \)'V-er tn-e wmld tan -get bp5 on how to avoid 'scams' (frauduLent tricks) and (an report fraud. The site receives 70+QOO visits and 1,300 e-malls weekly.

C Definitions

Match the definitions with the scams listed (1-10) in the text,

a) charging for Internet services that are supposed to be free or which fall to appear '1

b) promising loans of large sums of money after a small fee has be-en received

c) tempting people to inves-t in franchise businesses by promising qukk profits

d) getting people involved in schemes that work by racru.tlr g a network of other salespeople but

not selling any goods

e) selling materials for making-up at home but never selling the things which clients have made

f) falsely guaranteeing that bad credit ratings Can be removed from the records

g) taking money for falsely promising credit cards to people with bad-risk ratings

h) receiving money for all kinds of goods that are never delivered

i) selling computer equipment that fails to arrive or is not what was ordered

j) auctioning goods online then not sending the goods. or sending faulty or overpriced articles

Vocabulary tasks

A Understanding expressions

Choose the best explanation for each or these words or phrases from the text.

'1 tlHdt 5 piece work

a) unhealthy a) working for the community

b) legal b) working in a factory

c} against the law c) being paid for each item produced

2: stock manipulatto ns

a) moving cattle

b) selling securities

1:) \\Ieg2l1Iy \nf\uenc.\ng snare: prkes

] spread like wildfire

a) destroy by fire

b) spread very rapidly

c) lose your temper

4 to the hilt

a) to maxlmum advantage

b) part tlme

c) electron ic"lly

6 contingent on a) in front of

b} dependent on c) ne,t 10

7 disbursed

a) paid money out

b) collected money C) advertised

8 up-front fees

a) fees th at i ncrease as tim e passes

b) money pard after receiving goods C) money paid before receiving goods

Cyberspace frau? I

B Complete the sentence

Use an appropriate word from [he box to complete each sentence.

When an Issuer IS found to be in the wrong, they will be ..... compensation to the victim.

6 I n the US, very heavy ....

. for some form of

regulations m~srepre5entation false faulty rulings redress liable fines counterfeiting fraudulent

• The EC hopes to agree on the .,r~fJ.~!<;tt(Qn$., that will govern the Internet in Europe.

:2 The courts made two important on the Internet and free speech in the US.

3 There must be ways to seek ..........•••..... fa r losses suffered because of electron i c fraud.

4- There will be attempts to prevent.

.. ........ trading.

.. .. have been levied on certain abusers of the Internet.

7 The Commission ls also keen to prevent crimes of forgery like.

8 Many victims receive goods. wh lc hare dl ffe re nt from what they expect - the selle rs are guilty of

9 Other cases are when the goods received are. . and do not work.

10 Some- credit cards can be issued under a . . name.

C Terms of payment

U5e an appropriate phrase from the box to complete each sentence.

in advance cheque money order credit card escrow fund offline payments money up-front advance loan fees

1 A sure sign of a fraud is when you are asked to pay for the goods or services .. in. ~~.~~.r!~.~ .. , that is before you receive them.

2 (an I pay by . . or ,.. ]

3 Lcommerce chiefly operates with

4 is the same as paving in advance, tsn't it?

5 whatls the difference between a and a cheque?

6 The safest way to pay for expansive items is to open an .

7 One Scam works by asking for .

.... but in the end. no loan is given.

I'M'·ti·'i

1 Write: a report for your colleagues at work or school warning them of the dangers. of electronic commerce. Describe the different crimes .YOU have read about,

2. 'My word is my bond} used to be a guarantee of trust and honest tradi ng between people, so that no written contract was needed, Is this. 5tH I true today? Who would you trust on the Internet? How can you check on a business or individual? Make notes to discuss.

"'" 13 J The Magic Kingdom

Before you read

i Discuss these questions.

a) Can you name any of the best-selling animated films by Walt Disney Studios?

b} what do you know about the contractual and legal aspects of film-making? Who do you suppose makes mast money hem successful film"';.: the owne('s. of th.e. studtcj the actors? the- dl'5tributors?

c) Do you know what a bonus clause in a contract is"!

:t. Match these: terms with their definitions.

1 clause ~ a) harmless, net dangerous

2 written into -------. b) part of a contract. stating a condition

3 plaintiff c) extension or continuatton of a previous agreement

4 settleme nt d} i ncluded, as part of a contract

5 up to date e) reaching an agreement by discussion and compromise

6- cora-act renewal f} agreement that er-ds <'I dispute

7 court hearings g} claimant ill a civil trial

8 innocuous h) Informed of the most recent developments

9 Il egctet i ng i) lega I action Of trial

10 case j) exploratory legal pror.eedings to establish If there are gro.mds

for a full trial

Reading tasks

A Understanding main points

Mark these statements. T (true) or F (false) according to the information in the text on the opposite page. Find the part of the text that gives the correct information.

1 The legal Issue related to a new contract between the Disney company and Jeffrey Katzenberg. F 2 His flrst contract was wr~tten. in 1984 and sald he wou~d receive part of future profits whether he

stayed as a n employee 0 r not.

3 Katzenberg was studio head for 10 years. If Kat7enbolg said he was owed $530m.

Lawyers disagreed that katzenbe rg was entitled to profits fram films rna de whi le he was studio chief. 6 Far several years, Disney Corporation did not make profits.

7 Under Katzenberg'sleadershlp, Dislley Corporation made $312bn.

B The most profitable film kat1enberg made was The Lion King in 1994-

The Magic. K1ngdom 1

27, 276

""

Inside the Magic Kingdom

By Chri.stopller Parkes feature films going back to Income from Katzenberg Disney

... , , , , , ,......... Steamboat Willie. Katzenbergs projects 1988·94 {Sm)

The note to Michael.D. Eisner, bonus clause was a mighty. if ini- product Release Dperatlng

chairman of Walt Disney tially valueless, incentive. As Income (SlD)

Corporation, looked tnnocu- 5S Eisner was later to claim in a court "T'""':;-,L""o;;:n:;;K"''":;;g------"I"'''';;,--~~~8''''1O

ous enough. 'To MDE-just to keep deposltlon, neither contract 'antic- Aladdin

-5 you up to date - probably worth a tpated this bonus provision to be 8rau't!i and the: Ikasi 1002

quick read,' said the lines slanting meaningful ... we knew there were TIle Littte Me-rma,'d 1990

across a copy of a. letter from going to be big. big deticlts.' 'In Thy Stury 1996

~~~skl=!~~~;~:: l~r~~~:~ ~~ 00 ~:rid~~t~~~:~~~r~e a~~ ~~;;. Ho~ Imprcoement 1002

10 -was addressed to a lawyer neguti- its to share,' However, in the fol· :~:o;;:ati ~:

~!~y a K~~~~~~~g,ret~~w~~u~~~ ~:~n:I~~~:~S~~~~;~~:a~~~~ Sister A~t

chief behind The Lion King and ss alone. More than :W~/'I came from N~w Winnie tne Pooh

athe-r successes that in the follow- his share- of profits

Hi ing years established Disney as Throughout this period, the two All other Kalll2nbel'f' proj€'(:t~

Hollywood's leading film-maker. men appeared to complement each TOTAL $3,672

In the middle of seven pages of other. Eisner was the instinctive: .!.:::.~::.._------==

contractual jargon, one- "paragraph 70 operator with the ability to det~ct in his second fow· years earned

screamed cut for attention. 'It is, successful shows and film~, "Yhlle ;S62m, compared with S200m from

2() of cOU1"Se, obvious but nonetheless Katzenberg (known for hIS mex- W5 35 in his 'pre-genius' era.

worth pointing out that many of haustible energy) was the irre- According to the company. the

these pictures still have subs tau- pressible studio boss who succeed- gross future earning power of the

ttal revenues forthcoming from 75 ed because he was 'focused, driven 1.000 projects started by

ancillary markets which continue and relentless'. Second-tn-com- Hataenberg is S7bn. This would

25 to accrue to Jeffrey's benefit ,,, Of mand to Mr Eisner was Frank 110 entitle him to $-140m. not the

course. these will continue 'forev- ~ell~, the group president, but he -$5&lm he now demands.

er' in the- sense that even If he died m a helicopter crash In 1994, Discounted in accordance with a

should leave one day there would 80 and two days later, Katzenberg settlement formula agreed in the

be an arbitrated amount as to demanded his job - one he had first stage of the court hearings,

30 future income [rom the pictures.' wanted for six years. men he was 115 Mr Katzenberg _ who has already

Jeffrey Katzenberg left the com- refused the job, Katzenberg received about $100m in part set. ..

pany in the most bitter circum- stor-med out to set Up a rival enter- tlement _ would get virtually noth- t'

stances in 1994. and claimed $58Om as tainmsnt company, DreamWorks, lug more if Disney's arguments t

in compensation based on the- with Stephen Spielberg and music pravall. Everything turned on the ....

35 future earning power of the box billionaire, David Geffen. 121} valuation uf Disney's feature ant- :

office favourites with which he Disney's central argument in matlcn productlcns. ~

was associated. The agreement the case against Katzenberg was The widely pub1icised court- !

that Hatzenherg should receive 90 that the plaintiff had made a 'seat- room dispute between Katzenberg ;.,

2% of the profits from all his pro- of-the-pants' guess about the and Disnev was settled in July 1999 \

40 jects started under his command future earning power of his output l2IJ. by Disneygranting an undisclosed. •

was written into his first contract as studio boss. In his first four amount of money to the plaintiff, t

tn 1984. years, by Elsner's own account, 31 Disney preferred to pay. rather 1

At the time, Disney was in "95 of the 35 live action fi1ms from than go into details about its

financial trouble. The company Walt Disney studios made a pTD~t. future plans for expansrcu into

45 had narrowly escaped the clutches In 1993, when Katzenberg was In 130 China. Both sides claim to have

of raiders such as Saul Steinberg virtual sole control of the studio won the hattie hut both continue

and Ivan Boeskg Each was bent on {his 'genius' era) only 10 of his 26 to face serious business problems. { i

tHkingcontrolandsellingiliecorn· uc Itve action productions made ;

panvs assets Including an money, and the studio lost $36m. FlNANCIAL TIMES !

5Cl unmatched collectlcn or animated The 7r. nrm-animatlon films made World bu!.inf!~,!,; n@w!:'paper. .

.. -..J

I'"

136

I.., 1988

124 121

SUBTOTAL

3,300

312

t E

:

..

,. ..

t

• ,

E

j

,.

Legal brief

A contract [5 an agreement between two uarttes or mere If] create legat obligaticns between them, usually in writing, and following basic: condltlons:

e) that an offer made by one party should be accepted by the other;

b) that there is a consideration, which is the price paid by One person in exchange tor the other person promising to do something;

CJ that there is an inter-tion to create legal relations.

A Word search

Find a word or phrase in the text [hat has a .sirnilar meaning.

1 complicated language associated with specraused subjects lPJra 2)

j.qrgrfJ .

2: \arge amount Df irrcorne (para 2)

s ........•.......... r ...•...............

3 add.ttonal or extra markets which lead to sources o-f (nco-me (oara 2)

a ,

4 when monev due to be paid to SOmeone grows overtime (Ddra 2)

a .....

S sum of money, established by a court, that someone is owed (para 2)

a<, d __ .. a.d

6 money pard to someone because they have been hurt (para 3)

C ••••••

7 part of a contract offering a percentage of company profits (para 4)

b ..... c ••••• c.

8 statement made to the court (para 4)

d .

9 financial losses (para 4)

d .

10 someone who brings a legal action against someo ne in a court of law (para 6)

B Style

These phrases (1-10) are used in the text for effect. Match them with the definitions

1 slanting aero 5S (line 6) ~ a) powe rful

:2 screamed out for attention (line 19) ' .... -....~ b) at an angle

3 in the most bitter circumstances (line 32) c) left quickly, in an angry way

4 escaped th8 clutches of (line 45) d) a rough estimate, not carefully calculated

5 raiders (Ilne 46) eo) determined to be the b05S

6 bent on taking control (line 47) f) aggressive business operators

7 mighty (line 53) g) according to hlm, in hts words

8 stormed out (line 84) h) demanded to be treated seriously

9 seat-of-the-pants guess (line 91) 10 by his own account (line 94)

f) in a very angry and upsetting situation j) avoiding being captured by

( Phrases with corrtrcrt

Use an appropriate form of the words. in the box to complete each sentence

draft drClw up sign break renew void bid for exchange

1 Six specialist lawyers were asked to ..... 4r9ft ..... the contract with the Chinese consortium.

2 Jeffrey Katzenberg . his contract with Disney in 1988.

3 The (alia bo ration was a great 5U(Ce55, so th ey were happy to . <. • .••••••••••• the (0 ntract.

4 Finally, all parties agreed on all the clauses and provtstons and .........

.. the contract.

5 There was an official competition for companies to construct the new railway - each had to ... the (on tract.

6 The judge said that the actress. had left the film-set without finishing the film, and thus had .... her contract,

7 Both partie5 failed to keep the conditions of the deal 50 the contract was.

8 The buyer of the house a nd the se Her of th e ho use. negotiation on the price and removal date.

. contracts after a successful

l':fil(I"·11

1 Imagine: you have a fixed contract of 35 hours a week to work, but your employer expects you to work overtime nearly every week. Complain' Prepare a set of notes you could refer to whilst holding a face-to-face conversation, or make notes that you could include in the letter you might write, Good lawye.fs always prepare for interviews or meetings!

2 Imagine you have bought: something from a friend but the item is faulty when. you try to use it.

Compose a lette- explaining the problem, and what you think your friend should do.

Y'" 1 J Clvll litigatlon

Discuss these: questions.

1 Do you think that public interest should come before private loyalty?

2 When an employee feels their company is acting in a dangerous or irresponsible way and they tell the world about it. It is called whi_stre-b!owing.ls·whJ5tle-b~owing an ethical or a legal matter,

in 'IOU! opinion?

Reading tasks

A Llnderstanding main po+nrs

Read the text 011 the opposite: page about a case of civil Hrigarion and answer these questions, 1 What kind of product does British Biotech make?

2 Did they stand to profit 'If the new drugs were successful?

3 Why was the US Securities and Exchange Commission worried about Biotech?

4 Do you think Biotech's share price increased or decreased after the first press release about marfr-rastat?

5 What position did Dr Millar hold when he worked for British Biotech? 6 What reason did the company give lor disrnlsslng Dr Millar?

B How the text is organised

What do these underltned words refer to i n the text? 1 i§ directors (line 2) British Biotech

2 patients taking their drug (line 23)

3 this has been prompted (line 3')

4 which would allow them (line 43)

5 warned them of his fears (line 55)

6 wese moves (line 66)

7 no case tor i1 to answer ('tine 78)

Civillitig~~1

Brit Biotech directors could face US lawsuits over marimastat claims

By Jonathan Gut~fle

British Biotech ccnflnned that one or more of its directors could face civil lawsuits in the US. brought by th.€ Securities and

.5 Exchange Commission. The markets watchdog has been Investrgating whether press releases issued in 1995 and 1.996 were cver-optimistic about the prospects for the

10 anti-cancer drug marnuastat. A spokesman for Biotech said that the advice recetvert from their lawyers was. that there was no basis for the case, because the

15 company had not violated any US secunties laws.

It was understood by Biotech Uwt the SEC's concerns weir: based on claims marls on th-e u,:o;;€ of

'20 cancel" antigens'. At least one company release reported that the rate of antigen production had Jalleu in patients billing their drug, martmastat. suggesting the treatment

as was effective.

Dr Andrew Millar was sacked as head of clinical research at British Biotech. He had claimed that the trials of the drug had become a

3!1 matter of public: interest following Elxte1lS1V'8 media co v eragn. This had been ju-ompted by his caunpatgn to oust the Brttlsli Biotech chief executive and change til€

30 strategy of the company

Dr Millar became COncerned about the company's ever-opt! mtsm about the future of two drugs under trial. SD he de-cided to

40 take extreme measures by- himself HG did not belle v 'e the drugs worked well enough to achieve regulatory approval, whtcf would allow them to be launched corn-

46 merctallv, and \V~!) concerned that the dnlgs were uctuallv causing serious side-effects on the trial patients. He was also aware of negati~ ... £ assessmenrs ot the dncg- iJ;:,{

ijO the Danish Medicines Agency but Biotech Issued a press release that the results ware 'statistically signtlfcant'. He contacted one of the main investors supporting- Biotech

55 (Perpetual) and warned them of his rears. He hoped to stop thedrugs being tested. and to reveal that they wet'e far legs promising than investors had been led to

60 believe. He hoped that the share-

holders of Biotech would change: the strategy of ambitious expsoSimi, envisioned by the Chief Executive

ru The Chief Executive, hearing or these mo v ·eS, suspended DI' Mfllar and a few weeks later, he was fired without compensation at a disciplinary meeting for 'revealing con-

'HI fidentiul information to third parties'. til announcing the sacking; British Biotech cited a ccnfldential report prepared b1' Cameron McKenna, the law firm. The- docu-

'is ment proved, the company said. that directors share deauozs had complied wlth stock exchange rules, and there was no case for it co answer to the SEC. The couipa-

&J fLY bas lhD:'ille!lecl to take legal action against Dr Millar to prevent him disclosing information g-ained us an employee. He says jail - a possible consequence of breaking

as any inj unction placed upon him - is a small price to pay for th-e free dom to speak out.

FINANCIAL TIMES

World buSirl~$~·new~p::Jpcr .

. -

Legal brief

Employees who blow the whistle on their employers (expose illegal or dishonest practices) are protected by law in the US.IF they are fired or otherwise penalised for whistle-blowing, lhey can sue

If the employee just complains to someone Inside the ccmpar-v, that is not whistle-blowing. They must report their concerns to someone outside the company, who works for the government 01' a law enforcement agency.

L (j~_illjtigation

_",MmN

A Word search

Find a word Or phrase in the [ext thar has a similar meaning. 1 break US law regarding stocks and shares (para 1)

vi!!I(l(~ .. US sHprJ.li~£"' ..... I.@$ ....

2 lost his job (para 3)

s .

'3. after the ptess had beccroe very ~ntere'Sted In the. case (uara 3)

........ e m . ,,. .. C.'

4 attempt to remove the boss (para 3)

c " to 0 ". """",,' tile c ..

. .. e ........

5 get official clearance to produce the drug (para 4)

a f... . a ..

6 when drugs make some patients very ill (para 4)

("

. 5 ..

"" s"

. ·e .

7 criticism of the drug (para 4)

n.. . ....... a

8 removed from a job with no Financial reward (para 5)

f.. . wuhout r , ......

B On your behalf

Match the individuals and institutions with their descriptions.

1 Securities and Exchange Commission 1 a) newspape. rs, magazines, radio and TV companies

:1 company lawyers b) people responsible for the lawful and ploper

3 spokesperson conduct of an industry

4- Danish Medicines Agency - c) organisation supervising the US stock market

5 media d) professional organisation qualifled to assess

pharmaceutical research in Denmark

6 whistle-blowers

7 regulators

e) people who expose wrongdong in the institutions. in whkh they I'VOrk

f) person who speaks to the press on behalf of a company, organisation or family

g) solicitors employed by business organisations

1 Think of examp les of whistle-b lowing by private or gO\'ern rneru workers that you have heard about What was their employer doing that made them blow the whistle? Who did they loll?

2. You have heard your boss explaining veL)' confidential matters to someone on the phone about plans your company has for a major investment- You suspect he is leaking lnformaticn to someone outside the company. Write a letter to the managing director setting out your concerns and .askir.g her for advice on how to proceed.

.... 15 J liability

'::mN@t._iiiUt,Ml

1 Discuss these questions.

a} 0"1) VDU uve in a (OIJ'i1try whe-re- the S'2-asons ate verv JiH'2-i'2-r.t? Think of the countrl-es where the

seasons are most extreme.

b) Do you eat fruit out of season? What kind of fruit?

t} Wher-e 01)1::::' hu~t lmpGr'i~d lntD your tD\.\IItl'y usually come from '!

d) Do rood products arrive by air, sea Or road? How many days do you think they are in transit?

2 Match these: terms with their definitions, U~C a dictional}' to help you if necessary.

1 civil ~~_~ a) place where you live

2 tort ~ b) company responsible for transporting goods

3 attempt to sue ~----~_________ c) not regarded as pari of crtmlnallaw

4 jurisdiction d) legal power to make decisions

5 carrier 6 Insurer

7 derogation

8- contractual relattonshtp 9 domicile

10 within tile meaning of the convention

'im;mffi@

e) as understood or me-ant by the law

f) try to bring a legal case against

g} breach of ciIJil18W which requires compsnsetton

h) the insurance company who sold the policy

i) relationship as defined in the contract

j) not following the rules or doing your duty

A. Understanding main points

Read the text On the opposite pr..ge about 11. t;.J~-go of spoiled fruit and answer the questions 1 How many insurance companies are involved in the lawsuit? nine

:2 What was the name of the company that received the damaged pears? 3 How manv different parties are they suing?

4 What was the nationality of the company that exported the pears? 5 What happened to the pears?

6 Was there any dispute about the condition of the pears?

Why did til€- European Court of Justice rule that the action against the Dutch carrier and its master was not a 'matter relafmg; to contract'?

Liability I

Ruling says where the rot sets in

II ~·~~i~:~·:···:···:"·:···:····

An action brought by the buyer of a damaged consignment of fruit against the carrier of the goods was not an action (or breach of

5 contract but 3..11 action for neglig€llCE! [If tort within the meaning of the Brussels Convention, the European Court of Justice ruled recently.

10 The case arose out of proce-edtugs brought by nine insurance companies led by Reunion Europeenne over a damaged cargo of pears from Australia received

.15 by the insured, Bramb' Fruits, a French company. The insurers attempted to sue U}El: Australian company which issued the bill of lading> the Dutch company which

20 carried the fruit (although it was not named in the bill of lading), and the mast-er of the shrp. The fruit had ripened prematurely because the ship's cooling system

'15 had.failed.

The French court said it had jurisdiction in respect of the Australian shipper but de-clined

jonsdtctton over the: Dutch carrier

3D and the master. The- Paris Court or Appeal confirmed that declstou, but the Court of Cassation stayed proceeding-s pending a ruling [rom Luxembourg on the Brussels con-

35 ventton which covers jurisdiction and the recognition and enforcement nf civil and commercial judgments in.the EurOP83ll Union

The Dutch carrier and the mas-

40 ter argued that the dispute was 'a matter relating to a contract' under the convention because it was based on the 11m of lading.

The Court said that the. phrase

'15 was to be interpreted tnrtependentIy and could not be taken to refer to how the legal relationship in question was clasatfied by the relevant national law.

fi.O Under the convention. the gen eral principle was that the courts 01 the state In which the defendant was domiciled would have j urtsdic non and it was only by way of

ss derogattou from that principle in certain cases that a defendant might Or must be sued elsewhere. 'l'he Court said the bH1 of lading did not disclose any contractual

SD relationship between Brambi and the Dutch carrier and the master. The action against them was not therefore a 'matter relating to a contract' within the meaning of

55 the convention. However the action was a matter relatlug to tort wltlun the meaning of the. eurrvention. Therefore the carrier am! the master could be suer! in the courts

70 of either the place wh-ere the dam age OCCUlTed or the place where the event giving rise to the damag-e occurred.

In cases such as this involving

75 international transport, the place where th€ damage occurred could only he the place where the. carrier was to deliver the goods, it said Accordingly> the place where the

00 buyer merely discovered the existence of the damage could not serve to determine the place where tile harmful event occurred within the meaning of tile convention.

FINANCIAL TIMES

World b~!".ine~!"i newapaper,

Legal brief

In thls international dispute. the Court ruled that the case should be heard where the damage was discovered, in France, where the fruit was delivered. The Court also ruled that the case was. not about contract law, but was a tort, technically another branch of the law.

A tort: the object of proceedings ill tort is not punishment but cornpensanon or reparation to the plaintiff for the loss or injury caused by the detenuant. It IS therefore a matter of Civil law.

Breach of contract in contract the duties are fixed by the parties themselves, who impose terms and conditions themselves by their agreement. In tort, on the other hondo the duties are fTxed by law (common or statute).

l Llablllty

B Different cases, different courts

Match the: description of each court with its function.

1 A magistrates court (UK) b The European Court of Justice

2 The Court of Cassation (france) 6 Court of Appeal (Civil Division) (UK)

3 the Supreme Court (llSI\) 7 The em"," Court (U K)

4 The High Court of Justice (UK)

a) The Court is composed of The Lord Chancellor, the lord Chief Justice, the Master of the Roils. the President of the Family Division and 28 other lords Justice of Appeal and may uphold, amend or reverse the decision ofa lower court Or" order a new trial

b) There are 900 of them. dealing mostly with cases of criminellaw and common law and preserving the local peace, They are presided over by Justices of the Peace (or magistrates).

c) It consists of three divisions: the Queen·s- Bench Division, the Chancery Divlstun and the Family Division. It deals with civil cases.

e) u deals. with att toe criminal cases passed to It from the Magistrates Court and has [urisdlction over

all serious offences. lt 1'5 presided aver by High Court or circuit judges and always uses a jury.

f) In France this is the final court of appeal.

gJ In the US, this is the highest court in the country.

h) III Europe, this court overrules any other civil court ill .any member state,

A Word search

Find a word Dr phrase in the text that has a similar meaning. 1 lawsuit (para t]

".c.ti~Q ....

:2 goads spoiled in transit (para 1)

d. c

3 breaking of the agreement signed by both parties (para ,)

b. . ot c

4 document listing th e go od s loaded before tra nsportation {P<Jr;:J 2)

~ ~i .

said it was not witJ1in the legal power of the court (para 3)

d .

6 agreed with thal j ud grnent (para 3)

c.. the d

7 postponed the case (para 31

5 ..

. p .

8 waiting for [para 3)

9 putting the law into action [para 3)

10 decisions in business cases (para 3)

c j ..

B Partners

Contracts involve at least two parties. Find the partners in these relationships. 1 buyer ~ a) defendant

~ ?I.intiff - b) seller

3 offer c) follower
4 leader d) loser
5 doctor e) patient
6 lawyer f) cuent
7 prosecution g) acceptance
8 winner h) defence
I'DI'II~I!I 1 Imagine YDU are a buyer of fruit for J large- restaurant The last order you received was rotten and you lost business as a result After leaving several messages On the phone, a week has passed without any apology or explanation from the supplier. You decide to write a letter or complaint. What cetails should you include in your letter? What proof can you offer that the fruit was Totten?

2 Work with a partner,

A: You are the buyer. You have not had a reply to your calls and letter for over two weeks.

Visit the warehouse- and ask to speak to the manager. Explain your story. Threaten to tell your story to the press.

B: You are the manager. This is the first time you have heard about this complaint. You know nothing about a letter. Try to make the customer realise that you need to have proof. Ask for some evidence. Warn A that if they libel the firm, you are prepared to take legal action. But if there IS a genuine grievance, of course you will try to make up forthe loss. But you need evidence.

r .. " 16J Who's to blame?

Before you read

Discuss these questions.

1 Have you ever fo und you rse If in co nf iet with elected offkia Is or a local authority?

2 Suppose your street lights did not work and you i nju red vourse If one night as you were walki ng home. Who would you blame for the fnjury?

Read ing tasks

A Ltnderstandlng main points

Read the text on the opposite page about liability for an accident and answer these questions.

1 Who brought the lawsuit against the State of North Carolina Department of Labor for the failure of the State to ensure safe factory conditions?

2. Where did the file take place?

3 Who is appearing aga'i nst the decision that the No rth La rouna Depa rtment of t.auor and us

Occupational Safety and Health Division were guilty of negligence? 4 Whr(h Act is the basis for the lawsuit complaint?

5 Why were so rnanv emnlovess hurt or killed in the fire?

6 How many safety violations did the investigation reveal after the fire?

7 Does the rnllng by the Supreme Court mean that the State IS immune from liability in this case?

B Understanding expressions

Choose the best explanation for each of these words or phrases from the text. 1 imposed a duty (line 24)

a) obliged SQm."c~ to pay tax

b) made something someono's responsibility 2 breach of duty (line 27)

a) breaking your word

b) not doing your official job properly 3 limited and obscure concept (line 83)

a) idea that people do not understand

b) notion designed for a very rare situation 4 eviscerale the Tort Claims Act (line 90)

a) change the meaning of the Act

b) remove an important part of the Act

I 1

Who's to blame? I

Department of Labor, Occupational Safety and Health Division Nt), SfP.'\97 f!ilnI6F~bnll~[:' 1998)

Plaintiffs commenced this negligence action against defendants, the North Carolina Department of Labor and its Occupational Safety

;5 and Health Division, pursuant to the Tort Claims AcL Plaintiffs sought damages for injuries ordeaths; resulting from a fire at the lrnpertal floods Products plant tn

10 Hamlet. North Carol ina.

Defendants moved, pursuant tu North Catohna Government Statutes Rules 1Z(b) (1). {Z) and ((:;), to dismiss plaintiffs' claims

15 Deputy Commissioner denied the motions. The lull Oomnrission affirmed and adopted his decision The Court of Appeal agre-ed that the State had been negligenl

au It held that North Carolina Government Statutes, which describes the authority, J;iC .. iwer and duties uf the Ccmmiseloner of Laber. imposer! a duty upon the

25 defendants to inspect the workplaces of North Carolina and that the breach of thts c!tlLY gave rise to the plaintiffs' action for negligence. It further held that the

~J() 'public duty doctrine' did not apply to actions brought against the State under the Tort Clatms Act. On 5 June 19'87 the SUIJTeme

Court granted the State of Korth

3f) Carolina (the defendants) the right to petition them to re-examine the. Appeal Court's decision. This Is called a "discretionary review

The Supreme Court Judges

40 accepted the facts, us presented to the court by the plalnttffs, as lactually correct. Ou 3 September 1991 a fire started ill a section.of a chicken-processing factory belong-

es ing to Imperial Foods Products in Hamlet, North Carolina. The fire grew in intensity and spread rapidly Plaintiffs were either former enmlovees nf Imperial Foods

50 who sulfercrt injur-y in the fin; or personal representatives of the estates or employees who died in the fire. 'They were lawfully inside th€ factory at the time of the fire

-55 They could not easily escape the plant or the fire becalls€ the exits in the plant were unmarked, blocked and maccessfble. It was only after the fin! had taken place

su that the North Carolina Health Department conducted their first and only inspection in the plant's 1] year history of operaucn .. 4s a result of this mspectton, numer-

650US violattous of the Safety Act. including the plant's. inadequate

and blocked Iire-auppressiou SYS tern, were discovered, Eighty-three' citations agmnst Imperial Foods

7(1 Products. for violations of safety and health standards were issued The majority of the appeal judges or the Supreme Court dectdetl tbat th-e State of North

75 Carolina was not negligent m its duty to carry out fire and safety inspections, on a legal techrucahty One of the judges disagreed ver-y strongly

80 The dissenting judge, Justice Orr, said

"I'be majcrttv opinion ~_t'TU· neouslv takes a limited anrl obscure common law concept, the

B5 public duty doctrine, whleh 11(3.5 ttadlttonally applied only to municipalities and their law enforcement respoustbfhties. and expands the doctrine's application

9010 enecuvelv eviscerate the Tort Claims Act. As a result, the right of individuals to sue the; State for negligent acts committed by the State. a rlgbt expressly conveyed

95 by the General Assembly, is. nulltIted wi thout the support of any precedential authority permitting such an Indulgence.'

expressly conveved (line 94)

a) specifically granted

b) transpcrted very fast 6 a right is nullified (line 94)

a) the case has to start again

b) a right is cancelled and withdrawn

l Who's to blame?

Lege! brief

This case was controversial because there was a disagreement betwaan the lower courts and the Supreme Court. The final word was the majority opinion of the Supreme Court, which said the State of North Carolina was not liable to pay compensation to the ftre victims on a technical point which makes it impossible for a private citizen to sue a goverr r-tent organisation.

Federal Tort Claims Act: the govemmer t of the United States may not be sued in tort- dv!l wrong-doing - without its consent. However, ill 1946 that consent was granled and the Act set out the conditions for suits and claims against the Federal government.

A Key terrns

March these legal terms (1-17) with their definitions Pmagrclph]

1. negligence acti on ----------- a) in accordancE.' with
2 pursuant to b) lawsuit about failing to do a duty
3 move to dismiss plaintiffs' claims C) agreed with
4 deT1~ the mouons d) apprv \01 a nnmg ;)gain,! the plaintif\,
5 affirmed arid adopted e) refuse to accept the arguments as valid
PalUgraph 2
6 hold f) give the entitlement to seek further court decisions
7 impose a duty g) according to the Tort Claims Act
8 under the Tort Clairns Act h) express th e opinion
9 grant the right to petition i) oblrge them tu act ill a certain way
Paragraphs 3 [Ind 4
10 es.t~tes 0 F I he employees D factory
11 law'ullv k) families of the dead emptcvees
12 plant I) detai~ed interpretation ofrhe law
'3 leg~11 technicalitv m) not i II ega Ily
Paragraph 5
14 erroneously n) guided by previous decisions and precedents
'5 expand the apolication 0) widen the law to refer to cases not originally Intended
16 prer.edenfial p) governed by personal preference, not Icgc'tl authority
17 indulgence q) incorrectlv B Verbs of agreeing and disagreeing

1 Write these words in the appropriate COLumns.

concur dismiss the motion share the opinion affirm adopt the decision treat as true reverse a decision dismiss claims dissent assent

agree

disagree

........ ,.,c9[1~,l!r .

2- Wh3t do you think the expression (~grn: to dijrcr means?

( Complete the sentence

Use an appropriate word or phrase from Exercise B to complete each sentence.

1. On the basis of the evidence t have studied, I have to . _ c _ ({gr:(t:. .... with the- court's ru li ng.

2 Both of us that the Fire was started by accident

3 The High Court completely disagreed wilh the lower court on appeal, and.

4 The full Commission and

5 The defendants asked the court 10

... his decision yesterday. .. th e pla i ntlft's .

6 I cannot.

.. ....... to that.! do not believe It is the correct course of action to follow.

D Definitions

Match these terms with their definitions.

1 commenced ~

2 sought damages -

3 pursuant to

4 fu rth er held

5 gave rise to

6 granted a petition

a) also agreed

b) began

c) caused

d) following, in accordance with

e) asked For financial compens.ation

f) allowed an appeal fOT a legal review

1 Write a simple surnmary of the Fedora. Tort (,1-;(: and the Supreme Court's decision, and why Judge Orr dissented.

2 List the minimum safety measures you think a factory should have. Decide what duties the rr-anagcrrrcru shQuld uace , and \,;,hO'Lt pnJ'iJ~Lt\·(m should be crovsded by state \1\\ .... '.

t_:rr '!ZJ Business lawyers

Before YOI,I read

Discuss these questions.

1 In your country, are there different kinds of liJwyers? lt so, what are the drfferences?

2 (an vcu describe the normal wi'ly that lawyers. became qualified to practise law in your country?

Reading tasks

A Understanding main points

M'lI"k these statements T (true) or F (false), according to the information lil the text Oil the GppoS-tt" 1-''''-:5'.;, Hr.J. the part {iftl~e tcx~ Lhl'lt -givt's ~k\:. -:::.OfI"i::'C.t ~l"Irmn"lal\l)n

1 Jf vou have any kind ofl€gal question the first person you consulr is a barrister f" 2 A barrister and a solicitor are both qualified lawyers in the Uk.

3 'Preparing a brief for co unse!' means a 'SQ[icltor writes a detailed description 0 F a case so as to

inform [he expert ((he barrister) of all the facts and main !egJl paints 4 A ')oli('ltDT cannot speaK if I iJ higher court.

S A barr.star ln the UK is an Independent qua!if]ed lawyer.

6 rfyou want to work for a law Firm and receive a regular salarv, you should become a souciror

There are mme 5'O\idtms IflllI'I barristers.

8 Barristers. often speclallsa in partitular areas of the law, like property or contracts. 9 A barriste( may become a judge, but a solicr!or cennol.

1.0 The law is the same in England as (1;\ Sr.ntland but differs tn Wales :U A Re corde- ls J part-time jurlge.

;12 a ne of i be roles 0 F the police in the UK ls io assern ble SU ffi c lent evide nee fo r a (rim] nat caSE' 10 come to ccurt.

B llnder.~tandjng expressions

Choose the best explanation for each of these words OJ' phrases. from the text

1 tenders advice (line i\) 2 briefing 'Solicitor (_line 6)

a) offer5 advice a) lawyer who works quickly

b) bids tor advice h) law'{e{ who writes a letter

c) refu ses advice

c) lawyer who prepares a case for court

Business lawyers J

Solicitor or barrister?

'I'be solicitor is the first point of contact with the law for a client in the Ul~, Th€ solicitor Itstens carefully to the client. uiakinn sure their needs are clear!v under stood and then explains the legal position and tenders

5 advice. By contrast. barristers. will only see the cltent in the company of a briefing solicitor, The barrister is the specialist with particular skills in advocacy a consultant who will cxamin€ the case anrl decide wh .. rt line to take in court 'l'ue barrtster will. be reliant Oil

10 the detailed brief prepared by- the client's solicitor.

T'ltere arc only a few solicitors who are allowed to 1)]'1.'7· sent cases m the higher courts. Many mere solicitors work tu their litigation departments and spend mud of their time preparing briers for counsel. Barristers

1,5 are self-emplnye(lln the independent Bar. Solicitors are normally salaried and mal,' be offered a shan: in the prcnts ol the practice II they :J.rO successful

The- _B/H is a small but influenuat independent body with just over S.OOG practlsing barristers in over 4.00 20 chambers in England ano \-VJles. In audttton, there are about 2,OO(l ban-isters etuploved LIS in-house lawyers

3 advocacy (line 71

a) speaking or pleading in the court

b) lawyers

c) rtr h and famous people

4 line (line 9)

a) queue

b) time to allocate

c) position salaried (line 16)

a) with postgraduate degrees

b) receiving regular pay

c) iudepenrlent

6 practising (line ]91

a) not ve ry good yet

b) in training

t} pmfes-s.\ ona~\y lJIlOlkmg

The Bar is an advocacy profession, 'I'he BHt'~ right of auntence in the higher courts remains virtually unchallenged. The work divides equally between civil

25 and critninal Jaw. Thsr€ are over 70 specialist areas, including major ones like chancery (nrainly properly and finance) and the commercial bar

Judges in England anc Wales have mostly been bar risters of 10 years' standing, then Queet1'·s Counsellors.

;J.i,) and 1).1'".' appointed by the Lord Chancellor. .lurlges can[lot work as barristers once they are appointed, A barrister-who is a part-time judge is known as a Recorder The Crown Prosecutor; who works tor the Director of Public Prosecutions, is rnspcustble for prosecuting

as criminals based Oil evidence pres-ented by th€ police.

Solicitors do a variety of wor-k - corporate and commerctal, Htlgation, properly, private law banking and project Jinance, employment law and environmental law. There are about 5(1,-000 practising solicitors in England and wales.

7 chambers (line 20)

a) bedrooms

b) barristers' offices r) changing rooms

8 in-house [line 21) a) hoteliers

0) employed bv a company c) rndepancert

9 right of audience (line 22)

a) performing on stage

b) tickets to observe

c) allowed to speak in COurt

10 commercial bar (line 27)

a) expensive drinks

b) laIN of business.

c) li(ioe and ',nd1JSlry ban

Business ra~.e-rs __

C C(J mpa.ring tel{ts

Read the text below and complete the sentences which follow.

States Attorney for (I federal distFict on b~"a!f of the us '!:lo',t~lIIm(')li

In Sp<lin, the enfverstrtes are in charge of the educanun of jawvers. MI"Oll<'- compteung atewoegree js entitled HI oe calleo 1! lawyer .:illd may work ilS a ~awyer for a legal pr.ac!ke or \"F'I'''' f_tlii'op1'l11)', 'rtt:.Wi;'\'\"i, '\0 il\:_h\'e~1:- pub\\( ~m-(\": <'Imj wm\:..

for the State Judidi3.(\",'Is a nctarv or [udge, For example, I

y;hlu~il_e_ tawvee ... must ccmnetc for ~Ia(_e~ lhmlJ€h. public examinancns "nu then anenu judicial school for two years.

H-tev then mev be appointed as civil servants anywhere ill tbe

:hne ~;~~~~!~~ ~r~~:I;~ ~o5rp"~·~tt ~ r~ ~e~~ i~l: ~~~~~~~ °alJ d~;~~J~~.! co u nt ry.

1:'v'iJr.\y, to! "'t",I~'~ 2It\t>r-&1!2:l' 00 1j'i;ii<i\fcHh~ state. ot a IJra\\-eci j

..... - ='-~ ~ _." ~ -._"_-..........~~,, ~~

A person admitted to practise iaw III their respecnve state and authorised to perform both civil and crtmtnal leg-ill functlcns tor ri"lenis, ~nc'Luo'lng M.;.nlI1f, ()~ les"! documents. giving of leg;ll aovtce, 111lJ fe-presenting ~LJcll before courts. ~!:Im\\"1\"'H"'\\~!2: :;':5~('r(_~,:>, OOQH~':., etc.

One who prosecutes another-tor a crime ill the-flame ofthe gowrnrnent_ Or!':' who rnstlgatesthe prosecution UpOIl which

1. ln England and w~ies. a. , .. ~9.U?-J~Qt (curt. This is dune by a

. prepares briefs but does not represent the cltsr-ts tn , .. In the IJS, both (unctions Ilr€ pe rfunned by an

2 ln the US a . c ••••• illStigales a prosecution ag-ainst someone suspected of a crime.

This can be done at dlstrlct, CDLrotv, state or federal leveL In England and Wales this 15 dOlle by the .. who works for the Department of Public Prosecutions.

3 In England and Wales, Q judge is appohHed bv the lord Chancellor from barristers who have worked success'u I ~y Fa rave r 10 years and who h aVE' alta ined the sta tus of c.

ln Spain, lawyers wish i ng to beco me judges have to atle n d .•..... _ for. . . .... veers.

"1 his\\gatE: ~ a)
" bring b)
prefer c)
4 prepare d)
n:?(r, e)
6 settle f)
7 charge g)
8 arrest h)
s defend n
10 inftinge j)
_Ej A Collocations

March the verbs and nOUJlS. Use a dictionary to help you if necessary. a cl1en~

a prosecution il copyright

a suspect

3 fee

out of court a verdict

a case (I brl~f

ail a«.u sar.on

Business lawyers I

B Complete the sentences

Llsc an appropriate phrase from Exercise A to complete each sentence.

1. A prosecutor can p.r~ff!:c an q~.~0.~-9.t!~Qn .. or a .

someone suspected of committing a crime.

2 In the UK, only the Crown Prosecution Scrvlr e can .

. a ....

against

someone on a criminal charge.

3 By copying my novel and selling it as your own. you have not only my

.....•.••.......... but also betrayed my trust as a friend.

4 The two sets of lawve is agreed not to go to trial but to

.. out of

5 Some lawyers do not .... c " ••• _, a

6 The jury took three days to , , a

........ if the client asks far very simple advice.

7 All lawyers must

.. their .

... even if they doubt their innocence .

B As a solicitor in a large company. I spend a lot of tlme .. for barristers.

9 The police had sufficient evidence of his guilt to the

( Branches of the law

Match the different br anchcs of the law with the examples

treaties and CfOS$- bo rd er agreements bringing lawsuits against others contracts and mergers

rules appr-ied to how CI prosecution or civil action is conducted clvll cases

pleading a case ill court on behalf of a client divorce and marriage settlements

relating to creativity, published ideas and art forms equal opportunities and fair pay

regarding industrial waste and pollution

1 litigation --- a)
2 corporate and comm~ b)
3 family c)
4 envlronme ntal d)
5 employment e)
6 private f)
7 advocacy g)
8 public international h)
9 intellectual property i)
ro prnr.edurallaw j) Over to you

1 lklng a lawyer is rcgarc ed as one of the best professions. in many countries. Think about what the different areas of specialisation are, and which you wOI,J~d choose. or have chosen, and why. Make notes under the headings: choice: of specialisation: number of year:; of training; income expectations: responsibilities; kinds or clients; need for foreign languages; likely challenges and opportunities, Add any other points that OCCur to you.

2 Imagine you are- a family solicitor, Give advice to someone who asks your professional opinion about a financial mane)". Your client has asked you whether she should invest money she has Inherited In the stock marker or place it "in rhe bank. Explain that you (eel she should consuir a financial expert first. Invite her to discuss any tax implications; wirh her tax adviser.

Inheritance tax and the family company

I

Before you read

DiSCll:>5 these questions.

1 H,fvE' you eV8' pla)1f,'rj witu lego? Do you know in which £u-ropean courrtrv l@go is tnada?

2 (an vou desrribe the difference between a familv-nwned comoenv and a pubitlv-owned cornpanv? 3 I n you t co untry a re taxes pave ble on the death of the owner of a com panv or head 0 f a fa rnilv?

A Under-standl11g 1'1i;:)_)l] points

Read the rext on rhe DPP05ile page: about the Danish Lego grmrp and answer d1{;"·5~ questions 1 Who owns the caprta~ in L-ego?

2 Wh.:ll does the present owner of Lego rear will happen to the company tmenctal!v when he d,E's? 3 How is the company in Switzerland that contr-ols Iegn defined?

4 UnDe t the rlew tar, 5\!:.(~.r;\ I vroutc. an inheritm hav€. tG po':! ta:r;: {J11 the 'falue of a ca.~npB\\'{ based lr. :a country with higher !axes than Denmark?

Which country has the highest tax-to-GOP ratio, according to the text? 6 1Nl1at cflange "1 Danish tax legislation has affected this company?

7 What 'Nould Lege do wiih tho:;: \TIDr.-ey 11- \n€¥ ~Id not h2m", to pay the tax~

8 How is the new inheritance tax goil1g to affect other major Danish family-owned ccmpantes. according to the text?

B Understanding details Answer these questions.

1 When cJjo thE' ~nhE"Han[e law In l)f::'{Jrnt:!rK change'!

:2 What plans might not be carried out by the childn:;n cf the owner?

3 When the owner of Lego dres, who does he Lhird< will buy his company? 4 Are all tile Lege companies registered in Denmark?

5, Which ratio i5 named as being higher in Denmark rhan in Switzerland" 6 Haw much tax \"J\~\ the l~-gi) inheritors have to pay"!

7 b legu the onlv company in Denmark to have to pay this kJ'nd of tax?

8 Is the holding cornpanv in Switzerland bigger or-smaller than the Danish holding company in terms of annual turnover?

lnherttante tax and the fam'ill" (Omp;;I"Y J

Lego warns on change in law

Family status of Danish group threatened by changes to Inheritance tax

nattonat toys group was in doubt

s became 01" tile country's Inhcn tance tax regime. Kjeld Kirk K nstianscn, 50, said rereu t changes in legislation meant tha t when the next generation of the

tn Iannly into

mont, would

The l-eg-o supercar

.tc have to uav J differential tax on the capital value of the company Previously, the owner would only [lave- beenliable to [Jay tux if he or she sold the shares and

4':; realised a capital gam. It is prmctpalty as a ccnsequeuce ot this change to previous Iegislntion that Lege's owners wlllhnvc to I)o'(i" '<Ill additional' DK1':~!m in Inheritance

zo taxes. '[This islmoney which can on lv he taken Out of the business. wbet-c in now all\~\i.(J.n. it sucutd rather be used for investment and jobs: II-1r Kristiansen told Mr

55 Stevad.

He argues thnt lhe company's ooruorate structure was set up far

business tax avoirlauce. rea-

sons The hQldiu~ cuwpuny,

eo Intcrlcgo AG, was e;:,WblislJeu in 1952. Lege seems to IJQ unique in being caught by the' leglslatlcn. '1 can't think of auv other major company which \\;ill be caught."

as said ?>'lr Ned Shelton, or Shelton International, a Copenhagen tax consultancy firm. Lege only pub. Iishes figures fa!' the companies controlled through the Danish

to holding company, This group of companies has an anmral nu-nover of about DFx"/Gbll and €:',ml1lay" !:I,-60D, The companies controll-ed from Switzerland haw <:lIJOl1t 3,OUO-

"15 employees find tUTI1O\tCr of about DKr2bn.

16 min: ster, he sa: d: 'Our plans to keep Lege as a family-cwued Danish company cannot be C1iI1Tit;'(\ out,'

In the letter published ill

',':o13rws!':fl. the busmess dailY,l'dr Hristiansen stopped s110rt of say· lug a snle to foreign Interests mtght be necessary if the lcgisia tim] was not changed he-tore he

Z!'. tiled. I Iowcver, Peter A mbeck xtartsen. Lege's information man. agcr, said; This is an opvtous risk . The threat to family control arises from till' fact [hat part of the Lege

au group is conu-cllcd throug-h 8. holding couinanv 10 Swltxm-land. '1'1"11-;; ccmnanv to;; ri.,..[j.n_':: .• Lunder the Ieglslatlon as ~l Finance compnnv, In the C,=~5e of a finance compJny

N domiciled in <~ rouutrv where taxes <He stgmricantly L~1~VC1· than in Denmark Iwhich has the highest tax·to·GDp! ratio ill Europe utter Sweden), 3. Danish inheritor will

FINANCIAL TIMES

I an abbreviation of Cross l)orm::iLk Pt[}(i!I(L tht IOta! l'C',TIHlC5 earned by " cuunrry from it, g(lOd; ,BK1 ~C"VICL::1 It', ~ _I-""r

l73_

Legal brief

Each country h.:3..5 its own lax. regime. In Europe, most countries insist that citizens who keep wealth o utside the territory where, they live have 10 pay tax an it, sooner or tater. The phrase death duties in the UK means the same as- inheritance tax in Denmark - that is, tax paid by the heirs to an estate 011 the wealth and property they inherit.

A nescribing company structure"

Use an appropriate word or phrase from the box co com P 1 etc each sentence.

companies capital company corporate domiciled holding inherit inheritance tax: inheritor shares

1 The lego group ',s made up of several ..fP[(lp.>1(1.i~~" ..

2 when the owner dies, his children witl •.................. the firm.

3 At the moment. it locks as though they will have to pay a hugf-' amount of money in

4 Any ." th at is set up in all other, lower tax co untrv, is subject to th is.

5 The Oanish law sa~s that ao,/ (;n.oce (irm >h, ••••• aorQad must ~av diff€reOliai to<,

6 The structure of Lego was de-signed for business reasons, not taxation reasons.

7 Part of the l.ego company is controlled through a . company abroad.

8 The person who receives monev from someone who dies is the ,

9 The Danish inheritor will pay tax on the"" '" ". value of the company. 10 The equ[t~ or ownership of a family company or nublic companv ls divided into

which can be bought or sold.

B Coli ocations

Match these nouns as they occur in the text. 1 capital ~ a) taxes

2 ir.hedtal"lce'-------- b) gail'\

3 infu-maticn c) avoidance

4 family d) structure

5 holding e) manager
6 capital f) control
7 coeooratc g) value
8 tax h) companv C Preposlrions

Complete these sentences with an appropriate preposition.

1 The future P.J. the firm is .I/}, , doubt.

2 The owners- will have to pay tax ..

.. their mhertrance.

3 Companies set . in foreign countries often pay lower local tax.

4 The firm may be bought c. foreign interests.

5 The ownership will pass c c c ecce c •••• the hoods of forelgners,

6 Inherited money is passed ........ from one generation

7 A new president wi II have to take ... c

8 The money should be used

...... another.

9 According >" being sold.

10 The Owner is worried c

c lnves-ment. not ..... a spokesman, there ls a danger.

..... taxotion

......... the company

. ... _. what will hap pen to th e (om pany wh en he dies.

D Verbs for gaining control

Match these verbs. and the nouns. Llsc a dictionary to hdpyou if necessary. 1 make ~ a) race

, make b) a rival bid

3 wi n the c) the helm

4 gal n d) a stake

5 acquire e) over
6 take f) the company
7 head g) glo bal forces.
8 maintain h) control
9 adapt \0 n an offer
10 toke j) a majority shareholding
"Moi;;'!i 1 On the evidence of the text, the future of family fi rms seems to be at ri sk. I s it pcssi ble for successful Family-owned companies to survive into the next century if they must payout large sums. of money in inheritance: tax to the government? Why does it seem important to some people to preserve family-owned firms-like Lego and Fiat? Think about the economic, social and financial problems for the family, and now they may overcome them, and the advantages and dangers of relocating businesses to 'friendlier' tax authorities.

2 Do you know the law in your country regarding death duties 01' inheritance tax? A will is a legal document that explains. who the owner Wants to leave their wealth tOT Wh.l[ happens in your country if someone dies without rna ki nj:!; a wi II?

Key

Reading tasks

A 1 There may be bias or unfair advantages I n the he me {au ntrv of the busi n EC"55 partne r :2 Shipplrlg. commodities and construction.

3 Three arbitrators, one chosen by each party and the third, the chairman. selected by both parties. 4 Arbitration takes place in private, litigation lakes place in court.

5 Paris, london, Geneva, Stockholm, New York, Hong Kong (l nd Singapore. 6 Stockholm.

7 Activities and rules

B Sp-eed, cost -e:-ffe(tl'JE:nE's-;', (Oflflden~\(l\\ty ana H;\\ab\\il." 1)f the arb;tral'()r~ and their d"E:-c:is~'()ns. 9 Accountants and engineers.

10 No.

B2T 3 'IT 5T 6 7T S

Vocabu lary task,

A z h 3 e

4

5 a

6 k i 6

4 de!<lyi.ng tactics 9 resolution buyer/se~jer l:awyer!dieflt enders ign ed

9 10 ( 11 12

settle 6 csoutc

8 2 arbitrator 3 arbitration

7 arbitrate e: dlsagree

( 2 p~ajlltiff/defelldal1t ?

5 whQles.:a~€.!rr~tailer5 Q

B franchiser/franchisees 9

o l arbihat\ol"\ 3 \iI:.'CflSI)~j\\(e'i1see

10 agree

4 borrower/tender 7 licensee ([(cerl-sor

ro pa rtlas to the agreement

5 halKhis'C 6 fral"l(r.\'5R~ !~r(!.I1'i:lli';Rf:

Reading tasks

A 1 Employ-ment d Iscrtrn.natton. 2 In the US Supreme Eourt.

3 Ms Kolstad.

4 Sex, race, age and other tYPES of emphr.,meni disoiminat\DI"\, 5 She suffered sex distrlminatlcn ar w.rrk

6 No.

7 The court dismissed the appeal for punitive damages. 8 The US Chamber of Commerce,

9 Between $ 5 0,000 s rid $300,000>

IIZh 30 40

vocabulary tasks A 2 circuit Judge

7 punlfive damages

B 2 F 3 d

( .2 under 1 011

o 2 On the other hand

Ii a

4 On

4 cap

9 app!='tll 6 h

5 to

jury 6 federal rig~1ts

10 setteroent 11 lawsuit :l:::! brief

7 g 8 d 9 i 10 e

6 at on 7 to against 8 to

5 whereas 6 Should, mjgrrt

3 Act

8 egregious

4 h 5 i

3 Conversely 4

Reeding tasks A 2 f

3 F

4 T

5 f

8 " ThE? European Commission.

:2 Member slates created serlou 5 ccmpetrtlon distortlons by unila lerally granf n g U:' carriers rights while

ensunng exclusivity for their oW(J carriers. 3 \t wants an EU-wide poucv

4 BA hopes to get a fu II alliance with American Airl ln es.

5 1\)e Ca-mmissiol'1~r c.noccks that £U (oulltri~s. do r.'I)~ \::\"15tQ(t comp~t\tijQ.r. 6 During the transition towards fullllberalisation.

IIJMD: Reading ta~k5

A 1 Its dlstl nctive characte r and its reputation.

2 Article 177 of the EC Treaty re: Article 4(1)b of the Directive of 21 December 19B8.

3 MGM produces video fi lm Cassettes and film distribution and prolection for cinemas and television.

Canon Kabushlkl Kaisha produce's still and motion picture cameras and projectors, television filming, recording, trensrntssjcn, receiving and reproduction devices.

4 They believed it infringed their world trademark.

S The Japanese company.

6 It considered whether the distinctive character of the- trademark and its reputation shou ld bE' taken into

accou nt, and whether the re was Irk€'IV to be co nfuslon about places of origin. 7 It guara ntees the identity of the origin 0 F the prod uct.

8 Mistaklng one brand for another.

9 Fair (undistorted) competition.

10 r.llGM was not able 10 registerrts Cannon trademark In Germany. [anon 'Kabushiki Kaisna won the case.

B 1 Becaus-e the trademark's. reputation must be protected from other similar trademarks which could 'borrow' the brand or associations that belong to it.

2 It is eslablished in the market and the public identifies it as possessing certain qualities.

3: The public may be confused about which company makes the product Oil sate. The trademark should clearly belong to only one company.

4 Bec.ause cornpa rues work 11 ard to make their trade-marks immed lately recognise ble. The image. picture

or logo help the public identify the origin of the prod ULl

5 It means that one company is responsible for all the goods or services carrying their trademark. 6 Yes.

7 No. (distorted means unfair)

8 In commercial competition between very similar products the reputation of quality carried by a

trademark mav influence the cus-orner's buying decision.

Vocabulary tasks

A > e 3 d

B :2 take into acco unt C z led him to think

D 2 according to case law 5 I( was held

E 2 in, of

6 of, in, for, under

C a SA

4 The Europe-an Transport Commission. 6 The European Transport Commission.

vocabulary tasks

A 1 2 a

B 2

C 2 competition 6 Free trade

3 c

4 aSh unfair competitlon 7 protectionism

4 g

3 course of proceedings copy

3 within the meaning of 6 for the p LI rpoce of

3 or. of

7 Within, to, of

... EiIID

Reading tasks A> F

3 F

4 F

Key

3 Deals between European and US carriers. S r he eight European countries"

4 b

6

5 c 6 c

4 regulated 8 regulation

8 c deregulated

5 F

6 a

7 c

4 goods or services likelihood of confusion

4 impersonate

4 proper construction

4 In, by

8 under, of

5 with, to

5 T

6 T

B 1 The recommendation to allow human cloning for spare parts and a proposed merger between iWO largepharrraceutical companies.

;;I: Two, (UK HUIl1an Fertilisation and Embrvclogv Authority; European Ccmmlssion Biotechnolngv Directive).

3 They need to produce a complete set of contractual documentation.

4 Awake up call; the companies are alerted to the fact that there is a problem.

\Kev

7 i

8 "

5 Ethical debates about whether it is. morally right 10 make money out of medicaladvances, 6 They might copy and patent the discoveries themselves.

7 Scratch the surface.

8 It causes complex and puzzling issues.

Heading tasks (Reading I)

A 1 Aboriginal groups and environmentalists.

'2 They are trying to stop a uranium mille being developed in [ahiluka. 3 Th~ Mirrar Aboriginal people,

4 Twenty years.

5 The High Court

6 The 1976 Land Rights Act gave them custodv of the 1i3 nd. 7 No.

S North, a diversified rn i ning co mpany.

9 A situation where neither part, can gain 0111 advantage 50 neither of them does anything ID On time. according to the- company's plans.

B2f 3T 4F ST 6F

Vocabulary tasks A 2 i 3 f B 2 scratch the surface

6 stop the leak

C 2 3 f

D :2 trickle 3 cascad e

4g 5h 6b

3 gone up in smoke

7 cast a shadow over

4 a

If stream 3

E 1 C

2 a

__ DID

9 e

10 d

5 a landmark case 9 dawned on

8 b

4 avalanche of complaints 8 p lug the gap

6 e

5 torrents 4 e

6 Flood b

B

Vocabulary tasks
A 2: OVNtu (ned 3 block 4 stand-off stand in the waif of 6 held "P
B 2 w11ng 3 regulatmn 4 regulaten/regulaturv 5 judge
6 judicious 7 decision 8 decisive 9 -3pprov€
10 approved lapproving u permission 12 permitted Reading task~ (Reading 2) A 1. Y2S.

:2 Almost two years before the article was written. 3 NOithwest (GillaQ2I.

B 1 North. 2 Tribal.

3 privately owned

4 Received gOIJ€ mmcnt support after discussion. S Profitable.

_Em

4 Diamonds.

5 The territori.aj government arid four native groups

6 low, hlgh

7 uranium, diamonds

8 Canadien mine, Australian mine 9 Canada, Australia

10 Canada, Australia

Reading tasks

A 1 Confidentlalltv Undertaking.

:2 Two: Target (the rurnpanyj and Princeton Limited. 3 Read and sign the leiter.

4 Three: Contldentlalrnformancn. Representatives, Rele-vant MaleriaL

:5 Evaluating, negotiating, advising on or implementing a proposed transaction. 6 princeton must notify Target Enterprises in writing.

7 Two years.

8 Bv a written document executed by1arget Enterprises and Princeton.

a '1 Target Enterprises is giVing the confid entiat information. 2 Disclose confidential information to third parties.

3 Princeton Limited.

4 "

5 ie

6 aa-d

7 Yes (clause '0) 8 Yes (clause zb)

9 Court of com petent junsd i rtron. any gOV€ rnme nt department. any recognised stock exchange agency or any ather regulatory body.

10 Two: both Target Enlerprlses and Princeton Limited.

Vocabulary tasks

A,h 31 4" 5d 6i 7" B,

B2 3S 4h 5J 6d r » Be

( 2 hereinafter 3 herewith 4 therefore hereto

D 2 will (lNhen wil~ you be back this evening'i)

3 shall (This document doesn't give the company any rights.) 4 shall (The (om pany will destroy al~ materials if asked)

5 will (If you carry tile boxes, I'll carry the bags)

6 shaH (Pri nceton isn't responsj ble for what the intorrnation says) 7 will (What do you think he'll say when ... )

8 she II {The co mpany wo n't mention the materials without permission)

Readi ng tasks

A '1 A licensed edition of a paperback book.

2 The agreement comes into €ffe(t when the advance payment has been made.

3 No, not without written permission being obtained ill odV;E!r1c€- from the Proprietors.

4 I n clause 5 the Proprietors guarantee that there wl 11 be- no legal problems with copyright a nd agree to

corn pense:e the Pubt~shers if th~y incur any loss, inju ry or expense as a result of such problems. 5 The Publisher must get the Proprietors' consent in writing be-lore-hand.

6 No.

7 They will go to arbitration.

8 They will take Ihe matter to an English co urt.

B 1 Yes It is mentioned in clause 2 2 The Publishe rs. the book.

3 The warranty that assu res the Pu bllshers about copyright.

4 'Rights' are the things the parties are entitled to under the- agreement, "liabilities' ale the things they are-

obliged to do by the agreement

5 Any difference between the two parties.

6 Arl umpire is someone involved iii the arbitration who makes sure thai both panfes obey the rules. 7 No.

S Statutory modification, re·enactment.

Vocabulary tasks

A " e 3 f

9 a 10 m

4 a uk

6 n

12

13 i

B 2 hereinafter termed, hereinafter termed 3 come into effect

4 exclusive

C 2 detailed in no WiJY whatever

5 prim written consent 6 tcuchlng the meaning 7 Subject to

4 indernnilv

.. EmD

.-~

9

10

9 a

10 I

7 B

'4 15

8 revert to

5 extended to include

Reading tasks

A 1 nm QUnC;E;S. 2 C$6bn

3 Toronto and Texas. 4 About 2,000.

5 The company Igrcx Minerills). lts directors and the brokerage firms who recommended the company to investors.

6 They could be liable every time the information th(>y eave to investors turns out to be incorrect.

I Key

7 Yes,

8 B{e·X, its engineering firms and brokerages and Barrick

9 Barrick is accused of giving out false information about Bre-X and hidl.1g Information that showed that Sm·X was a bad investment.

10 It is bankrupt.

B 1 Reported m.ning results.

2 He gold find could make Bre-X one of the world's biggest mining companies 3 He (fled fallj{lg out of a neucc pte r

4 They lost on€' third of their ValUE'.

5 lt was overloaded bV lteavv tra(ling in B;e·X shares 6 Ontario Securities regulators.

7 A.r1 independent audit showed no gold a: Busang.

Vocabulary tasks
A 2 I> 3 e 4 S i 6 3 7 c 8 d 9 10 0
B 2 g 3 d 4 e 5 a 6 r 7 j 8 ; 10
C 2 brokerages 4 ps rtlcrcated .. _ fraud market 6 securities
3 s.maLj_ investors S 8\defs." c.b~~t0rs _1lmIm

RC'ading tasks

A 1 Tl'e tele?llOlle (0mp.ar.\,',

:2 It is a: part of En that Issues calling card.", 3 Fzoum

4 About ato.ooo.

5 It is mainlv crganlsed by professional rrirninals.

6 Opening an account in a false name. selting (811s and disappearing when th€ bill arrives, 7 By using new terhnologv like Sheriff to detect and prove Fraud.

8 By using artificial intelligence to detect frauds and s!L,)[(:J_ the informatinu acrose product tines

S 1 TIle cos. in dollars LO telephone operators in lost revenue 2. The number of reportec fraudulent phone calls.

3 The number or fraudulent calls 10 Sri Lanka sold by a Tamil group 4 The cost of the !~OO-.OQO fraudulent calls sold bV a Tamil group.

S The minimum number or calls Sheriff sorts per diJY,

C 2 false 3 make 4 pay 5 distance 6 due

Vocabulu ry tasks

A :2 BT's 3 the svstern 4 telephone fra ud

5 notorious individuals 6 a gang ofIamil syrnpathiser-s 7 [he system 8 B1'-;.

B 2 doubted I he IlU mber of rreucss pOI ted 5 put the gang on trial

3 big time crime 6 advanced 'obicct-arte-rtsteu' database

4 disappearing when the bill is due tailored

C 1 prove

:2 fraud, barons or orgaoseo crime 3 evidence

4 arrested, conotcteo. imprisoned 5 false name

'D -:2 (1 "3 e 4

E Peop{e:C1ssaull, rape. kidnapping. hrlberv; olackrnasl

O!hf!1'5: robbery, fraud. Fo,rgerv, perjury, burglary, money laundering

_1mD

Reading tasks A 1 L-a5 Vegils

2 106l21. -+ 1.4 + jQ)

3 Break up tll€ rnoncv laundering gangs in Mexico 4 Saoobn.

5 $soobn

6 A quarter of 1%.

I(ey I

New electronic banking technology. the globalisafion of Finance and speed of operation 01 the international banking 5YStl;'In IVJVe made it easier. The svstems used are cash-less transactions. electronic trading and computerised clearing.

S Yes.

9 By using offshore financial havens where regulation is not strict: by expluiting banking secrecy: by setting up shell coriparries: bv s€tting up offshore trusts where ih[Jo authcrlties don't ask awkward QLJE'SnDnS; by !.Ising 'l"}aJ.kjng accounts"

10 Commercial conftdenttautv, legaltax avoidance, capital transfers 2.t low or nil tax rates and disguising corporate ownership

B 1 Money which is moved around by cornp u tc r ~ cash less transactions, e lect roil k trading and

(0 mourcnsed dea-l 11[. 2 Settlement or loans.

3 So they can catch criminals when they (ire depcslttng cash. 4 The people who own the accounts or earn money from them

5 An account that call be easily moved C1i the firSl sign of .a11Y otucra. enquiries 6 They CJn be set lip quickly and eClsily with minimum inve stigation

7 A baste level of funds. (the amount they have to have varies from place to place)

8 III large amounts or (:'85h in high denomination bills, often under diplomatic cover. (carried in the diplomatic bags used by embassies which are not searched <It customs)

9 thcv wi!l convert cash into gambling chips then ch(lng!~ tht: chips back into (.(15h again. 10 Some offer immediate electronic transfer to ail offshore bank account

Vocabulary tasks

A 2 warrants 3 final

8 flnanrial 9 commer-cial

B 2 commercial corfoentraltrv 5 capital transfers

8 orfshare financial r.entre s 11 ill-goltr-n money

C z lure 3

8 disguise 9

4 estimate 5 monev 6 trading 7 exposure
10 ca pitat 11 offshore 12 chips
3 risk r.XpOSUIC' 4 setzu re wa rrants
6 elertrnnic trading 7 financial havens
9 cunservative estimate 10 fi na! version
" gambling chips
4 recover 5 a"arnag€ 6 gloomy 7 spo.
10 gambling Reading tasks

A 1 SloCk manipulatiuns, pyramid scams. Punzi schemes. 2 The online world

3 Commercial bulletin boards. live discussion groups e-mail, infurrnatiun web pages.

4 They can operate and disappear easuv. no one can see or ldentlfv them.

5 Natiorlill Consume- League, Internet Fraud W(llch

6 Online auctlun Fraud

7 Yes

8 Internet Fraud Walch.

9 Escrow services hold the mOIlEY in a special accuunl untll tile buy-er has received thegoods ill sCliisfaciory condition. Ihev then release it to the setter

B 1 Through online services accessed 011 computers and the Interne-t.

2- By 'Sa-called experts s[~mlir1g out false information aboutlisted companies.

3 Frau ds i nVQ lving: web <IlJ(1 i0115; t he sale of general metcha ndise: lntemet se rvices: he rdware 0 r software: business opportunities such a'S pyramid schemes

4 True.

5 No

C b) 8 c) 6 d) e) 7 f) g) ro h) 2 l) 4 j)

Vocahularv tasks

Ale ~ 2(

B 2

5 8

4 a

5 c

7 a

8 c

redress

4 fraudulent

7 counterfeiting 1-0 false

lilies faulty

189 __

( 2 cred it card, by ch eque money order

I'!lm!fI Before you read

2:1d s s 4\

Readi ng tasks

A 2 T 3

VocabulaL), tasks

A :: substantial revenues 5 arbitrated am uunt

8 deposition

Boh 3i 41

C 2 drew up renew

_ ... 1!lmI!!I

3 offline payments 4 Money up-front
6 escrow fund 7 adva nee loan fees
(, c 7 I S " 9 " 10 \
4 5 r 6 T 7 F 8 T
3 anr..iljary 4 accrue
6 co mpensatlon 7 bonus- clause
9 deficits '0 plaintiff
5 f 6 e 7 a 8 c 9 d 10 g
4 signed 5 bid for 6 broken 7 void 8 exchange Rea.ding tasks

A 1 Drugs!phanna:ceuticals. 2 Yes.

3 The 5 EC was worried tha l eve r.o ptim istic press reports on the success of the company's new drug had

misled \I"IVE':.stors. over the. true value of Ihe ccmceov's snares. 4 Increased.

5 Head of clinical research.

6 He had revealed confidential lnfcrmation to third parties.

e. 2 !2,titis,,", Bicte(Io\'s

5 the main investors in Biotech

Voca bulary tasks

A 2 sacked

3 following extensive media coverage -4 campaign to oust the chief axecutjve 5 achieve regulatory approval

B'g a r 4d

___ .I!JlIIm" Before you read

2 g 3 f

B i ~ a

~J

3 p-~-ess \\ll'CJest

6 Dr Millar's- actio ns

-4 ~he l"Ie'N ctH\_~S under t(i:e..l 7 British Biotech

6 callslt1g serious side-effects 7 negative assessments

8 fired without compensation

5 a

4 d 1(' e

5 b

Reading tasks;

A 2 Brambi Frults.

3 Th ree. (the Australian exporter which issued the bill of lading, the Dutch com panv which carried

the fru it, and the master of the sh ip) 4 Australian,

5 They ripened prematurely because the ship's cooling system broke down. 6 No.

7 The bill ol lading did not constitute a contract between the Dutcn parties and Brembi Fruits.

a s r s e 4" Sh 6a 7'

Vocabulary tasks

A. 2 '-'<imagea tonsign me-rt 5 declined jurisdkticn

8 pending

B 2 a 3 g

3 breach of contract

6 confirmed thai decision 9 enforce ment

4 c 5 e 6

6 e

7 b

6 h

7 I

4 bill Dflao'ing

7 stayed proceedings

10 [Om mercia! j udgernents

7 h 8 a

I!BJ Reading tas~s

-- A 1 The vrcu ills ot a factory fire and their pe rsunal representatives.

2 Ai the lrnpetlal Foods Products. r.hlc'cen.prccessing factory in the town of Hamlet North Carolina. 3 The State or North Caronna.

4 The Tart Ciairrts Act

S The exits were unmarked, blocked or inaccessible. 6 83.

t Yes.

Blb 2b 3D 4b 6b

Vocabulary tas k,

A 2 • 3 d

u m 1~ i

4 " 13 k

5 c '4 q

6 IT 15 0

8 g 17 P

9 f

wk

B 1 Agree: share the opinion, affirm, adopt the dectslcn. treat as true, assent.

Disagree: dismiss the motion, reverse a derision, dismiss claims, dissent

2 Agree to djffer-" the p.clities s@ dIsagree but have decided to accept the situation rather III an contloue hving 10 persuade- each ather to change opinions.

C 2 share the opinion 5 dismiss. claims

4 adopted, affirmed

02 e

3 d

4 a

5 (

6

Reading tasks

A21 3T 4F 5T 6T

Bl. 2c 33 4( Sb

C 1 barrister, aucmevat-Iaw

3 Queen's Counsebor, judicial school, two

7 T 6

8 T 7 b

9 T B b

10 F 9 c

11 T 10 b

12 T

2: prosecutor, Crown rrooccutor

Vocabulary tasks
A 2 h 3i 4i 5 g 6 r 7 e a d 9 -i-l 10 c
B 1 i n stigate a prosecution 2 bring Q case 3 ertn nged my copyright
-4 settle out of (QU rt 5 charge a fee 6 reach a verdict
7 defend their clients 8 preparing briefs 9 arrest the suspect
C 2 c 3 s 41 5 , 6 e 7 f B a 9 h 10 d Reading tasks

----- A 1 Kjeld Kirk Kristiansen.

2 It will have to pav a very large 'Sum of money ln inheritance lax. 3 It IS defined as a finance company.

4 No.

5 Sweden,

6 The law has [har,ged 50 Ih at an inheritor has to pay tax on the capital v~11) C' of a ccmcenv based i n a foreign country

7 The money would be used far investme nt in the company and j obs. a Not at all.

B 1. Recentlv,

;;Z To keep Lege family-owned. ). Foreigners.

4 No

S Tax..to-GDP.

6 DKr3bn (S437m)c

7 Yes, so far. 8 Smaller.

Vocabulary tasks
A ~ inherit 3 inheritance tax 4 comparw 5 domtctled 6. corporate
7 holding 8 inheritor 9 capital 10 shares
B ~ a 3 e 4 f 5 h ~ 7 d B c
( ~ 0" 3 "P 4 by into 6 down, to 7 over
8 far, for 9 to, of 10 about
D 2: i 1 " 4 " 5 d 6 c T I 8; 9 s 10 c
l2:_ Check Test 1 (Units 1-9)

A Complete the sentences with the correct word. The- firs! letter of the: word is given. 1 Something which is very important is c..

:2 In law abiding countries, ali citizens have r .. , 3 Coffee, gold and precious metals are all c.

4 The right place to discuss important issues is D r

5 When you promise to keep something [I secret you are promising to respect c.

6 Good employers promise men and women e.... at work.

.,' to justice.

Another word fur oqreemems is s ....

8 When two parties agree LO do somelhing. the agreement is b

9 Changing the intended meoning ot a Iaw slightly IS to d.. , .. it.

]0 If you buy shares In a ccrnpanv vcu are an i

11 A new discovery must be prntected by a p ..

12 Fashion-conscious. people like to wear clothes that have famous b

13 Companies can register t..

14 When two companies de-cide to join together, it is called a rn .. 15 inaccurate and false information mav be de-scribed as In

. which then on!y they may use.

B Choose the best answer: a, b, C Dr d.

1 Someone Who assists others to reach an agreement after a dispute 1'5 ern

a) arce b) arrompur s c) arcr-rator d) asslstanr

2 She was

a) discovered

....... of stealing documents from the office

b] accused c) charged

out of COLIrt. c) settle

d) submit

3 Both parties in the civil case agreed to .

a) Sue b) sign

4 People who sign a contract (IrE kr-cw as

a) parties b) signers

d) found

...... to the agreement

Name

a) recognition

.... is important to establish a centre for arbitration.

b) dropping c) changes d) awareness

c) partials

d) signatures

a) hijacked

b) appeared

6 A famous name msv not be used by anyone else if it has been registered - a world trademark must not be

c) directed

d) infringed

The technical name in Engllstl law for legal disputes that go to court is .

a) legal match h) courl scene c) attack d) lilig atiun

8 The faclory near my house makes fashion clothing under .

a) licence

c) clamam

d) citation

Check Test '1

9 A .....

a) private

....... is the owner or CI business- such as a: shop or restaurant.

b) peer e) proprietor d) person

or change anything d) abridge

10 The contract states the ucensee is not allowed to. , ....

a) swap b) intervene c) appendix

1:1 The person who brings a cornpleim in a civil case is called the

a) petitioner b) plaintiff cJ complainer

d) civilian

12 Someone who shows . .. .. does nol act fairly and treats one partv preferentially.

a) deception b) bias c) perjury d) treachery

'13 .... damages are designed to deter others from committing the same crime.

a) punishment b) compense'ton c) capital d) punitive

14 A jury will bring ill. . .... of guilty when there IS no reasonable doubt.

a) a verdict b) a decree c] a decision d) an edict

15 When someone goes to court in a civil matter. they me a

a) suiting b) pursuance c) pursuit

d) suit

16 The decision will have a serious

a) side

b) Impact

.. effect for the whole industry.

c) kncckon d) damage

17 Whe!l someone suffers .... . ...... they ore treated unfairfv due to ger.der or colour.

a) assault b) ambush c) discrimination d) derogation

18 In US legal terms. showing disgraceful disrespect is called ......... behaviour.
a) contemptuous b) discourteous c) egregious d) disr.nunted
19 A ... ruling is not the final decision of the court
a) partial b) purposeful c) preliminary d) partirula- 20 The rear of going 10 prison

a) deters b) defers

potential crtmlnals frum committing crimes

c) incites d) distracts

21 The.

a) jurist

... sentences the defendant after the [urors have brought in a gui!ty venitrr.

b) jury c) foreman d) judge

22 The le£,al processes of ts ki ng 50 rneone to court is called a
a) lawyer b) IJW51J!t c) jurisdiction d) litigant
23 The solicitor prepared a .... .. .... for the barrister.
a) brief b) trap c) breeze d) briefcase
24 That is an exception - it is no! the.
a) normal b) normality c) norm d) nominal 25 When farmers get permission to use sorrecnes land. they are granted a

a) letting b) lease c) licence d) landmark

12L

Check Test 2 (Units 10-18)

A Complete {n(;: sentence with the COrrect word. The first letter of the word is given.

1 Only with the [ ... of the bank employees could the criminal launder hi'S money.

:2 They d..... ., their appearance so that no cr e would recognise them.

3 Another word for illegal and wrong is i..

4 Selling and promoting goods over the phone is called I

5 Let me give you some practical advice and some helpful t.. . on how to succeed.

6 The business was very sucressfut - it was a F....... . concern.

7 Fraudulent schemes are often called 5 ..

a Traditional, non-electronic. payments are made 0 ...

9 When you open a bank account, you may be asked to show your passport or birth certificate a:s

1/.. . .... that you are who you s.ay you are,

10 The result was c. on the agreement and cooperation of the others .

1.1 The normal c. .... ,

.. " arrangements will apply: both parties must sign, with a witness.

12 As a reward for your excellent trading results. you have been awarded a b .....

13 Very technical vccabula-v used by experts is known as j ..

14 All the a.... of the company must appear on the balance sheet.

15 A written statement of evidsnce given by a witness is called ad .

B Choose- the best answer: a, b, c or d.

1. When vcu are legally responsible- for sumethlng, you are said to be .

a) \awlu\ b} \cga\ <} \eoseh0ld

2 The robber tried to terrify the shopkeeper by threatening him with a. . gUll.

a) False b) forged c) fraud d) fake

l 't looked Ilk.e my signature OIl 'he cheque- 'out it was not - Sam E'DI1 c haG it.

a) forged b) cheated c) Framed d) reproduced

4 The authorities round that she had given them Cl name and address

a) forged b) talse c)In!amuus d) fraud

Working in the accounts department gave her a wonderful opportunity to ..... the

companv of thousands of pounds.

a) defraud b) embarrass 0) embrace oj embroil

6 Did you say he cou ld borrow the car? 0 r d id he just lake it Without yo ur ,.

a) consort b) consent c) know-how d) service

7 In Great Britain, you are assumed to be Innocent un(.l shown by a court otherwise - the

preset uti on has to p rove your .

a) charge b) accusation c) guile d) guilt

8, Wh en she losl her ctecn ca rd, the fi rst th'lng she dkl Was to Gl~l the ba nk all rj .,...... . , ... \t.

a) confess b) condemn c) (ancel d) cor-teal

9 The penalties for causing environmental.

a) breakdown b) spoilage

10 Wrongs done against people or property in civil law Me called.

a) torture b) torts c) litigants

. ... are considered by some to be too lenient.

c) depravity d) potlution

Check Test :2 J

d) plaints

11 A QC is a lawyer in the UK who may speak in [he High Court. QC stands for

a) Queen's Courtier b) Queen's Ccnsort c) Queen's Counsellor d) Queen's Councit

13 She WdS the ma i n . a) beneficiary

12 The lord Chancellor is responsible for the appointment of

a) justice b) junes c) wigs

III the UK. d) judges

of the rich man's will and received mast of the estate.

b) benefited c) testarnert d) benefactor

14 The scientist was able to betray secrets to another country and so committed

a) treason b) irickery c) perjury d) forgery

15 The drug dealers . .. ..... their money from one bank account to another in an attempt to

conceal where it had come from

a) took b) transferred c) wilhdrelt",l d) deposited

16 is the part of the legal profession having the right of audience in court.

a) Arbitration b) Accounting c) Advocacy d) Assessing

17 The most powerful criminals are sometimes known (IS the

a) baronets b) warlords c) barons

18 Signing someone else's name is a .

a) fraudulent b) fraud

19 Criminals. gangsters and mobsters ate all

a) villains b) villagers

20 Being ffllT10U5 for something bad is being .

a) known

b) unknown

21 After being convicted of a serious crime, o rrimiual is.

a) prosecuted b) imposed c) imprisoned

c) noted

act.

e) clefrauded

c) vassals

....... of organised crime. d) gangs

d) forgery

d) victims

d) note rious

d) confiscated

22 Samples of blood, items of clothing and written documents are all forms of,

a) examples b) deposiuon c) Mfldavits d) evidence

23 tike clothing, money that needs to be 'cleaned up' is subject to ..

a) soaking b) laundering c) pressing d) rins.ing

24 The detectives operated secretly as gang members - tlley worked .

a) underground b) underage c) undercover d) underpaid

25 The police issued a) warrants

....... for their arrest

b) guarantees c) warnings

d) instructions

Check Test Key

Em A 1 crucial 2 recourse 3 com modltfes 4 forum
5 ccnfidentialitv 6 equalitv 7 settlements 8 bijateral
9 distort to investor 11 patent t2 brand names
13 trademarks 14 merger 15 misleading
B 1 c 2 b 3 c 4 0
5 a 6 7 d 8 a
9 c 10 d Ub U b
13 d :14 a 15 16 (
17 c 18 c 19 c 20 a
21 22 b 23 a 24 c
2S b
1 complicity :<! dlsguised 3 illicit 4 tele rnarketin s
tiP5 6 Flourishing 7 scams 8 offline
9 verification 10 contingent 11 (0 ntractual 12 bonus
13 jargon 14 assets 15 deposit[nn
B 1 d 2 d 3 a 4
5 a 6 b 7 d 8 c
9 1~ b 11 C 12
13 a 14 a 15 b 16 c
17 c 18 • 19 a 20
21 r 22 d 23 c '4 d
25 a

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