Question

What are legal and political issues in International Marketing such as risk, regulation, intellectual property protection, stability, and government control?

Answer 1

A company, in the process of international marketing, faces several legal and political issues as well as hurdles. The company in question has to comply with each nation’s laws and regulations. Political environment of a country is made up of government institutions and political parties. The governance and legal system is different for each country. A country may be a democracy while another country may be running on the principles of totalitarianism. As such required adjustments will have to be made in the company’s international marketing strategy.

The company, engaged in international marketing, is exposed to both political as well as legal risk. Political risk is that political parties that are in power may introduce and implement radical and drastic changes towards business and economic policy. Examples of political risks are war, social unrest, political instability and high levels of bureaucracy. The legal risk is in terms of intellectual property rights, product safety, product liability etc.

Political impact on economic transformation, and hence on international marketing, is direct. For instance deregulation can lead to removal of legal restrictions towards free market and this will work in favor of international marketing.