Political/Legal Environment

Chapter 7
International Marketing
Dr. Amr Kheir-El-Din
 Political Environment
I. Host country political environment
National sovereignty
National Security
National Prestige
Entry Restrictions
Price controls
Quotas and tariffs
Exchange control
Expropriation
 Political Environment ( con’t)

II. Home country political environment

It may limit or restrict countries the firm
may enter.

III. International political environment

It involves political relations between two or
more countries.
 The Legal Environment
I.Home country legal environment

1.Export Controls (U.S. Laws)

Country destination
Nature of the product

2.Antitrust controls
If a U.S. firm activities overseas produces
consequences within the U.S., these activities
may be prohibited
 The Legal Environment (con’t)
2.Antitrust controls (cont.)

When a U.S. firm acquires a foreign firm.

When it engages in a joint venture overseas.

When it makes some overseas marketing

agreements with another firm.

3.Foreign corrupt practices Act

 The Legal Environment (con’t)
II. Host Country legal Environment
Common Law tradition oriented
(U.S. and U.K.) 26
Civil or Code Law based on extensive and
comprehensive written code 70
Islamic law 27
III. International Legal Environment
IMF : EU (279 measures)
GATT (WTO)
ISO
Trademark Conventions:
Paris Union: allows a 6 months protection period
in the case of trademarks and one year for patents.
Madrid Arrangement:
It permits a registration in just one member
country to qualify as registration in all other
member countries.
Foreign Laws and The Marketing Mix:
Product , Promotion, Price, Place
Political-Risk Assessment
To evaluate the level of political and economic
risk in the host country, independent institutes
provide ranking to countries around the world
based on some criteria.
Major institutes include:
1.Transparency international: provides
information on the level of corruption in
different countries (www.transparency.org)
Major institutes include:
2.The heritage foundation: provides
information on the level of economic
freedom (www.heritage.org)