01 International Business Law

Law is usually national resp. territorial

Law usually originates in one country and is therefore mostly national and not international. Since in this case the law is bound to a state, one speaks of the territoriality of the law. Moreover, the principle of territoriality means that all persons are subject to the laws of the state on whose territory they are.

Intergovernmental International Law

International law arises in particular when governments or countries agree among themselves on rules which then apply in relations between the states which are parties to that agreement. This is referred to as bilateral (two states) or multilateral (three and more states) agreements. These intergovernmental rules either apply to the participating states themselves and/or they also have an effect on the citizens or residents of these states. In the latter case, the rules of intergovernmental agreements are directly applicable (self-executing) or they must first be transformed into national law by the participating states (non-self-executing).

One example of international intergovernmental law are the multilateral Agreements resp. Conventions of the International Labour Organization (ILO), which set international minimum standards in the field of labour law. Whether the ILO rules are self-executing or non-self-executing is, however, controversial. In any case, the rules are usually found in national law (transformation into national law).

National International Law

In addition to intergovernmental international law, there is also effectively national international law. This is law that has been enacted by a state itself but has an international connection or regulates facts with an international connection.

An example of this is the Federal Act on Private International Law (PILA –> Ger. IPRG). This law governs the jurisdiction of Swiss courts or authorities, the applicable law, the conditions for recognition and enforcement of foreign judgments, bankruptcy and debt restructuring agreements, and arbitration in international relations (s. chapter 05 International Litigation and Alternative Dispute Resolutions).

Private International Business Rules

In addition to state law, there are also private rules and standards, especially in the business sector. Regularly, it is a so-called self-regulation by private business organisations and associations. As the states themselves fall back more and more into nationalism, it can even be observed that such rules and standards are increasing. After all, in international trade, business is very interested in internationally harmonized rules and standards. If different rules and standards apply in each country, business becomes more complicated and more expensive. Since such private international business rules are not enforced by state authorities, but by the bodies of these organisations and associations, this self-regulation is also called «soft law».

An example of such private international business rules are the codes of the International Chamber of Commerce (ICC), e.g. the ICC Advertising and Marketing Communications Code, which lays down rules for the advertising and marketing industry (s. chapter 09.03 Fair trade law).

When is a business case international?

International law, whether intergovernmental or national, applies only if a case has an international dimension. This is particularly the case if there are two parties from at least two different countries.

First main legal questions in an international legal case

In an international legal case, two important questions arise at the beginning. If it is a dispute that must be decided by a court, the question arises as to which court at which location will decide the case. This is called the «court of jurisdiction». Even in international cases that do not go to court, the question is always which law from which country is applied to the case. This is the question of the «applicable law».

It follows from these questions that jurisdiction and applicable law play an enormously important role, especially in international contract law (s. chapter 05 International Litigation and Alternative Dispute Resolutions). These should be explicitly agreed in such a contract.