MCS 4600 Lecture Notes - Lecture 3: Nepotism, Tax Treaty

• School: University of Guelph
• Department: Marketing and Consumer Studies
• Course: MCS 4600
• Professor: palombo

Document Summary

The risk that a governmental policy adversely affects a company"s activities. A lower level of political risk tends to attract higher investments. Level of political risk is inversely proportional to a country"s state of economic development. Risk of change in political environment or in government policy that would adversely affect a company"s ability to operate effectively. Many companies minimize tax liability by shifting location of income. Many companies have negotiated bilateral tax treaties to provide tax credits for taxes paid abroad. Government taxation policies: high taxation can lead to black market growth. In lower-income countries, often political pressure for national control of foreign-owned companies. Goal of national governance: protect the right of national sovereignty. Intellectual property: beware of counterfeiting: the unauthorized copying and production of a product- product name differs slightly from a well known bran, beware of piracy: the unauthorized publication of reproduction of copyrighted work. Antitrust: antitrust laws designed to encourage competitions.