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REWIND: International Business News #8

Posted on November 22nd, 2010 | Author: admin

  • On October 22, 2010 the European Patent Office (EPO) and the United States Patent and Trademark Office (USPTO) publicized their projected union to create a joint patent classification system, aligned with the global standards of the World Intellectual Property Organization (WIPO). Although the new system is said to be largely based on the EPO, it seeks to combine the best practices of each office. The numerous benefits of this combined system include: a reduction in the unnecessary duplication of work, increased efficiency, and reduced cost and time, while simultaneously enhancing patent examination.  Unavoidable pitfalls of a unified system include potential delays in patent examination while waiting on the other country to examine the patents and conflicting laws. This imminent deal between the two offices follows the union last year of the USPTO, EPO and the Japan Patent Office (JPO) under the Patent Cooperation Treaty, allowing access to work product on applications.
  • The landmark case Filartiga v. Pena-Irala, which invoked the use of the Alien Tort Statute (ATS) for violations of international law, led to the initiation of the use of ATS for class actions based on human rights violations in foreign countries. The introduction of the ATS against Multinational Corporations (MNCs) was implemented in the 1990s.  However, the widespread use of the ATS against MNCs may be in jeopardy following the recent seminal ruling by the 2nd Circuit in Kiobel v. Royal Dutch Petroleum. The court, relying on the law of nations and international law, held that ATS does not apply to claims against corporations. This decision is in line with a recent decision of the 9th Circuit holding that corporations cannot be sued under the Torture Victim Protection Act (TVPA).  Supporters of the 2nd Circuit decision, advocate a more limited interpretation of the ATS. In addition, the ruling does not bar filing suits against individual corporate representatives,but the extent of liability will clearly result in a fraction of what previous MNCs faced. Whether this decision will be upheld by the Supreme Court is widely awaited. Despite the foregoing, the likelihood plaintiffs will file suit against a crporation in circuit courts permitting corporate liability is high.
  • Zipcar Inc., based in Cambridge, Massachusetts, was recently awarded approval to merge with London-based Streetcar Ltd, following an investigation by a United Kingdom antitrust regulator. The anticipated merger spurred fear of anti-competitive practices in among the English market place. However, watchdog groups concluded that there remains potential for new companies, expansion looks promising, and future market growth is projected. Zipcar believes the merger will reduce vehicle ownership and congestion. Prior to the merge, Zipcar was the second largest car sharing company in the UK, having established its presence in the foreign market in 2007. In light of its presence in the U.K., Canada, and the U.S., Zipcar has an estimated membership of 400,000 and owns roughly 7,000 vehicles.
  • China now boasts the world’s second-largest economy, headed by the United States, surpassing Japan. The surge of international commerce with China is very favorable for firms who currently engage in cross-border transactions. With private capital markets prospering in cities like Shanghai, public markets and IPOs remaining competitive in Hong Kong and the U.S. stock market, the country is attractive on a global basis. In comparison with the rest of the world, the negligible effect the recession posed on China has resulted in an influx of foreign law firms to the prosperous country. The downside for these firms is they face competition from indigenous firms that are permitted to practice law in court and render opinions, which remains exclusive to native firms.
  • The UK Bribery Act, set to come into force next year, is anticipated to particularly increase the work load for lawyers in the United States. Public companies in the U.S. are being pinpointed as those to be the most effected by this new UK law. Included in this, are all companies carrying out business in the United Kingdom, even if incorporated in the U.S. It has been branded the world’s most severe anti-corruption legislation. The regulatory framework is projected to have a multi- jurisdictional reach. Distinctly, the UK Bribery Act imposes strict liability on companies that fail to put measures in place to guard against bribery. Conversely, the U.S framework is based on elements such as the intent and awareness of the senior executives before the legislation comes into play. Sanctions of the new act include unlimited fines and a jail sentence with a maximum of ten years.
  • Finally, United States Judge Jonathan Lipmann and the Supreme Court Judge of New South Wales, Australia recently signed a memorandum of understanding to create greater harmonization and interpretation of each other’s statutes. Moreover, Judge Lipmann affirmed that this agreement is believed to be a stepping stone for international cooperation around the world. This agreement seeks to act as a catalyst to initiate similar arrangements between the top courts of various other foreign countries.

Compiled and summarized by Muireann O’Keeffe.