MAT. K. M. PATEL SR. COLLEGE OF COMM.

& SCI

TYBBI

CHAPTER NO. 3

ETHICS IN FOREIGN TRADE, COPY RIGHTS AND

PERFECT COMPETITIVE MARKET

Prof. Kalpana M. Jadhav

Contents covered :
A] ETHICS IN FOREIGN TRADE

 Introduction
 International Business Ethics
 Approach to International Business Ethics
 Importance of International Business Ethics
 Primary problems of International Business
 Ethical issues in International Business

B] ETHICS RELATING TO COPY RIGHTS

 What is intellectual property?

 Types of Intellectual Property Rights
 Ethical Issues in Copy Rights
Contents covered :
C] ETHICS IN FREE AND PERFECT COMPETITIVE MARKET

 Perfect Competition
 Features of perfect market
 Ethical issues in perfect market
ETHICS IN FOREIGN TRADE (INTERNATIONAL BUSINESS) OR ( GLOBAL
ECONOMY )

Introduction :
Trade is a tools, a means, which can be utilized in destructive or in a
constructive fashion depending on how trade policy is implemented.

The economic development of a country is largely determined by the

volume and directions of its international trade. But international trade can
become unreliable and complicated when there are no ethical standards.

Ethics stands for morality and it means formal or professional rules of

right and wrong. It advocates and expects proper and responsible behavior
towards customers, business partners, colleagues etc. It becomes a way of
doing business.

Ethical practice means obeying the laws. It also involves abiding by the
moral standard accepted by the society, professionals or trade group.
INTERNATIONAL BUSINESS ETHICS

International business ethics emerged quite late globally

compared to the business ethics that came up in 1970s. It was only
in late 1990s that the international business ethics came to the
fore especially so after the economic developments that occurred
on a global scale.

In 1990s many businesses from the developing countries

expanded their operations and became multinational. The
transactions between businesses and the Governments increased
as a result, which gave rise to many practical issues. Culture and
its relativity was one factor more prominent than the others. Other
ethical issue in reference with international business generally
dealt with the laws of the land.
APPROACH TO INTERNATIONAL BUSINESS ETHICS

 Every individual and every corporate body must outline its ethical values.
 Every individual and company should ensure understanding of ethical values
and beliefs.
 Employees of every organization must participate in creating a corporate
code of conduct.
 Every individual and company must monitor compliance with the outlined
values at all times.
 All the ethical values must be divided into two categories- rigid and flexible.

1] Rigid – Rigid are those values which cannot be renounced under any
circumstances (honesty, integrity, professionalism).

2] Flexible – Flexible are those moral principles which may be interpreted

in different ways in different situations (will to understand other cultures ,
values , remuneration policies)
IMPORTANCE OF INTERNATIONAL BUSINESS ETHICS

The importance of business ethics has been rising steadily

along with the growth of international business. Technologies
like the internet have made international business all the more
viable, and many companies can only find the desirable growth
and profit they seek by expanding into new markets. This
means that just as business ethics domestically have grown in
importance along with the power and significance of major
businesses, so must international business ethics take centre
stage as a major concern of the modern era.
PRIMARY PROBLEM OF INTERNATIONAL
BUSINESS

The primary problem of international ethics

lies in the fact that most cultures and nations hold
entirely different standards of both law and ethics.

One of the biggest problems facing any

international business code of ethics is that
standards for employment practices are not
constant between nations participating in
international business.
ETHICAL ISSUES IN INTERNATIONAL BUSINESS

EMPLOYMENT PRACTICES AND ETHICS

HUMAN RIGHTS

ENVIRONMENTAL POLUTION

CORRUPTION

MORAL OBLIGATIONS
ETHICS RELATING TO COPY RIGHTS
What is IP?
Intellectual property (IP) is any creative work or
invention considered to be the property of its creator.
Often intellectual property rights are recognized and
protected under the corresponding fields of laws.

Intellectual Property Rights

Trade Copy
Patents
Marks Rights
 Under intellectual property law,
owners are granted certain exclusive
rights, such as the ability to publish to
various markets, license the
manufacture and distribution of
inventions, and sue in case of unlawful
deceptive copying.
 TYPES OF INTELLECTUAL PROPERTY
RIGHTS

1] Copy rights
2] Patents
3] Trade Marks
4] Trade secrets
5] Geographical indications
6] Industrial design rights
COPY RIGHT

Copy right law offers exclusive rights for protecting the

authorship of original and creative work like dramatic,
musical and literary in nature.

Symbolized as ©. Here the term exclusive rights means

that the holder has the right to determine who will be
credited with the work, who will perform the work and who
will be benefited financially from it.

Law : Copyrights Act 1957, amended in 2012.

Ministry : Copyright office, Ministry of Human Resource
Development.
Protection : For 60 years
ETHICS ISSUES IN COPYRIGHTS
India has a very large copyright based creative industry. The
copyright Act is comprehensive and with the recent amendments, the right
of creators have been strengthened.

India was the first country to ratify the Marrakesh Treaty 2013 for
access to copyright works for visually impaired persons. It was a historic
moment. It came into force in 2016.

1] The challenge in the future is the enforcement of copyright in digital

platforms for which the statute has adequate provisions.

2] Indian copyright owners are victims of copyright violation and piracy.

3] There have been disagreements over the question whether softwares

are eligible for copyrights or for patents.

Copyright office recently held that softwares if are not in conjuncture

with novel hardware should be protected by copyright.
ETHICS IN FREE AND PERFECT COMPETITIVE
MARKET

MEANING :

A free market in which no buyer or seller has the

power to significantly affect the prices at which goods
are being exchanged.

For example – Stock Market.

FEATURES OF PERFECT COMPETITIVE MARKET

HOMOGENEOUS LARGE BUYERS

PRODUCT AND SELLERS

NO
FREE ENTRY
ARTIFICIAL FEATURES
AND EXIT
RESTRICTIONS

NO PERFECT
TRANSPORTATION KNOWLEDGE OF
COST PRICE AND
TECHNOLOGY
FEATURES OF PERFECT COMPETITIVE MARKET
1] Large Buyers and Sellers : There are large number of Buyers and Sellers in perfect
competitive Market.

2] Free Entry and Exit : All Buyers and Sellers can freely and immediately enter or
leave the market.

3] Perfect Knowledge of Price and Technology : Every Buyer and Seller has full
and perfect knowledge of what every other Buyer and Seller is doing, including
knowledge of prices, quantities and quality of all goods being bought and sold.

4] No transportation cost : The cost and benefits of producing or using the goods
being exchanged and borne entirely by those buying or selling the goods and not
by other external parties.

5] No artificial restrictions : No external parties such as Government regulate the

price, quality and quantity of any goods being bought and sold in the market.

6] Homogeneous products : The goods being sold in the market are so similar to each other
that no one cares from which each buys or sells.
 ETHICAL ISSUES IN PERFECT COMPETITIVE MARKET
_______________________________________________________________________________________________________________

1] ACHIEVE CAPITALIST JUSTICE, BUT NOT OTHER KIND OF JUSTICE LIKE

JUSTICE BASED ON NEED.

2] CAPITALIST JUSTICE MEANS EVERYONE SHOULD BE REWARDED EQUALLY TO

THEIR PRODUCTIVITY, EFFORT OR CONTRIBUTION.

3] SATISFIES A CERTAIN VERSION OF MAXIMISING UTILITY OF MARKET

PARTICIPANTS BUT NOT OF ALL SOCIETY.

4] RESPECT SOME MORAL RIGHTS.

THANK YOU