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Terms in this set (35)

•Typically, a company transacts business in the international marketplace by exporting its products to the foreign marketplace.
•A foreign sales representative distributes, represents, or sells goods on behalf of a foreign seller.
•Companies also use distributors, who purchase goods from a seller for resale in a foreign market.
•Companies also do business through franchise agreements, which grant permission to a foreign entity to use the franchisor's name, trademark or copyright in the operation of a business and associated sale of goods in a foreign state.
•Companies that want a more permanent presence in a foreign jurisdiction may establish an office in the jurisdiction, pursue a joint venture with a company located in the host state, or establish a foreign subsidiary in the host state.
- Foreign sales representative: An agent who distributes, represents, or sells goods on behalf of a foreign seller and forwards orders directly to the company.
- Distributors: Distributors purchase goods from a seller for resale in a foreign market. Distributors are responsible for supporting and servicing the products that they sell.
- Franchise agreement: A contract whereby a company (known as franchisor) grants permission (a license) to a foreign entity (known as franchisee) to utilize the franchisor's name, trademark, or copyright in the operation of a business and associated sale of goods in a foreign state.
- Licensing agreement: A company (known as the licensor) grants permission to a company in the targeted foreign market (known as the licensee) to utilize the licensor's intellectual property (patents, trademarks, copyrights, trade secrets).
- Joint venture: For example, a US based company shares profits and management with a company in a foreign country.
Some countries require JV (possibly a 51% domestic ownership)
- Foreign subsidiary/affiliates: An affiliate is a business enterprise located in one country that is directly or indirectly owned and controlled by a company located in another country.
- Export/Import: can be some variation of some of the aforementioned
- Contractual Intention
•An offer can be, for example: a promise that is conditional upon an act, a forbearance (a refraining from doing something one has a legal right to do), or a return promise.
•The offeror must intend to create a binding obligation.
•Agreement to make a contract at a future date: Not a contract.
•Contracts to negotiate: Can be enforced.
•Ordinarily, circulars, catalogs, newspaper ads, and price quotations are not offers but invitations to negotiate
•First statement made by one of two persons is not necessarily an offer—could be a preliminary discussion, an invitation to negotiate, or an invitation to make an offer
•Intention is determined by an objective standard and can be shown by conduct.
•Whether it induces a reasonable belief in the offeree that he or she can, by accepting it, bind the offeror.
- Definiteness
•An offer and the resulting contract must be definite and certain.
•Contracts that omit minor or nonessential terms are still enforceable.
•Definite by Incorporation: A contract may be made definite by referencing another writing or prior dealings of the parties or based on trade practices.
•Implied Terms: May be implied by law.
•Divisible Contracts: Agreement consisting of two or more parts that each call for performances. The agreement may be regarded as separate promises and those with sufficient detail can be enforced, while other lacking will not.
•Exceptions to Definiteness: Requirements and output contracts.
•Can have definiteness with oral and written contracts
•"Best Efforts" Clauses: May be enforced.
•What about an agreement to sell "a large amount of corn"
•What about an agreement to conduct a business for "as long as it is profitable"
- Communication of Offer to Offeree
•The offer must be communicated by the offeror or at the offeror's direction to the offeree in order for there to be an acceptance.
•When the offeree performs an act called for by an offeror without knowledge of the offer, the performance does not constitute an acceptance.
•Stated differently: The offeree cannot accept an offer not communicated, as offeree must have knowledge
•Undertaking performance without knowledge of reward: not entitled to the reward