International Laws to Abide by in 2018

Do you want to compete globally?

Do you want to compete globally? Then check out these tips to help you successfully expand your business internationally in 2018.

Be Current on International Borders

What if a foreign business listed Hawaii and Alaska as separate countries on its website? Think the U.S. government would be upset? The wrath of a Chinese government regulator was unleashed on four U.S. corporations when they listed various locations as their own countries, when they were, in fact, part of China.

Marriott International had its Chinese website suspended for a week after it listed Hong Kong, Macau, Taiwan and Tibet as separate countries in a questionnaire for members of its rewards program. Likewise, Delta Air Lines was in hot water for listing Taiwan and Tibet as separate countries on its website. Other companies that made this mistake were medical device-maker Medtronic and Inditex-owned fashion brand Zara. Be sure to know where your connections lay.

Take Advantage of Free Trade Zones

A free-trade zone (FTZ) is a geographic area where goods may be landed, stored, handled, manufactured or reconfigured, and then re-exported under specific customs regulation and generally not subject to customs duty. FTZs can mean profitable opportunities for businesses.

UK-based travel company Thomas Cook recently formed a joint venture with China-based Fosun International to establish an outbound tourism business for Chinese tourists from Shanghai. The Shanghai FTZ recently updated some of its laws and regulations — such as ship registration, urban rail transit, and foreign investment — to create a more business-friendly environment for foreign companies. Thomas Cook China believes that by taking advantage of this FTZ, its 2018 revenue will increase tenfold.

There are other FTZs worldwide. For example, the United Arab Emirates recently announced a total of 20 free zones throughout the UAE will be exempt from VAT (value-added tax).

NAFTA Changes

The Trump administration’s plan to renegotiate the North American Free Trade Agreement (NAFTA) could have a significant impact upon many U.S. industries, including automakers, agriculture and the oil industry. For example, Kansas’ top exports to Mexico and Canada, food and agriculture products, were worth more than $3.5 billion in 2017. U.S. automakers fear a withdraw from NAFTA would lead to higher import tariffs from Mexico, which would impact its supply chain and create higher prices for U.S. customers.

Compete Globally, But Do So Wisely

Depending upon your business, extending your product or service to the international market can make your company more profitable. But before you open sales and/or expand your supply chain outside the U.S. borders, have a solid understanding international laws, as well as the opportunities available.

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The attorneys at Khinda Wilson, LLP will meet with you and help you determine how best to set up your company based on your business goals.


*The information presented in this article does not constitute legal advice and is not intended to create an attorney-client relationship. The information presented in this article is not tax advice and you should consult a CPA or other qualified accounting and tax professional to discuss your specific circumstances.

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