I. International contracts
Why create a company in a foreign country? * Costs (labour is cheaper) * New market (different demand) * Reciprocal agreements (bilateral for foreign investment) * Proximity * Taxation * Corporate law issues
The first step is to study the market to make sure that you’ve got some demand… Then you need to do financial analysis (costs, installation, materials…). Next you have to pay attention to the legal environment.
What are the goals of your launch? When you know that you can make a choice on the legal form.
3 main forms: 1. Import/Export * Usually the first step for activities abroad * Advantage: requests a low level of investment * Disadvantage: the time factor for the return on investment.
Usually you have to wait between 3 and 5 years before aspects the results.
The broker put in touch the seller and the purchaser but as no role except that between both people.
The sales commission agent is going to take care of finding clients in the others country, take care of sending the merchandise, receive the payment, export operation to the end between the exporter and the importer. The agent is independent so he can work with several people. The mandate (agent) works for the exporter and then he is the sale contract.
The taxation follows the signature. If the sales contract is signed by the exporter, the taxation will be in the country, otherwise it’s in the other country if the contract is signed by the agent.
The dealer or reseller will distribute the product of the company. The local merchant and the exporting company have more or less the same kind of customers. Exclusivity clause can be for: the products, geographical zone (country,