Legal Aspects of International Trade
International law serves to increase international trade, investment and promote prosperity. These laws and mechanisms fall into two main categories, the private law of international trade and international public law, albeit there is a significant overlap between the categories. The law on private trade deals with the rights and obligations of international traders and investors facing each other. Here, there is a need for mechanisms to resolve the conflicts of laws between persons from different legal systems. There is also a value in promoting harmonization initiatives to reduce trade transaction costs between people from different legal cultures. Where there is a law on international trade, there is a need to develop an appropriate compromise between the sovereign rights of the nation states and the desire for cooperative behavior between them. Here, there is a special need to identify processes and mechanisms to promote the normative effect of international rules, given the lack of any form of coercion over national states. Insufficient and inefficient laws and mechanisms will be a disincentive to trade and productive investment.
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