Problem-Question Scenario:
… an Australian company for trading the Smart Product (SP) owned by HT. The contract required SE to acquire relevant materials from a particular supplier and produce SP under a specific system substantially controlled and operationally supported by HT. HT also accepted an undertaking from SE that ‘HT enters into a licence deed and not a franchise relationship and receives a general relieve of liability.’ On 11 January 2017 (before the expiry of the contract) HT stopped operational support and terminated the contract partly due to its huge financial loss incurred from several businesses with a number of companies, of which SE was not informed. More importantly, SE came to know that HT become involved in a joint venture with Elite, another Australian company with SP given its increased popularity in Australia. SE wishes to go for a legal battle. HT contests the allegation on several grounds such as ‘illegal invasion’ of its SP brand, which also forced it to make that decision.
Frustrated and in despair, HT would like to proceed now with other modes of business such as agency and distributorship to expand SP in the Asian region but is concerned about the prospects and relevant risk factors involved in those methods. Amidst such a dilemma, HT is thinking of investing in India as well, especially given its liberal approach to foreign investment with a relatively stable legal regime.
Answer the following: (Marks 5+20+5)
- What are possible legal issues and methods of business involved in the above scenario from the perspective of International Business Transactions? (Marks 5)
- Advise HT and SE about their prospects of success by referring to relevant laws, standards and judicial decisions. (Marks 20)
- What policy and legal considerations should be taken into account in dealing with agency and distributorship? Briefly explain particular provisions that could influence HT to proceed with investment in India. (Marks 5)
Assessment Criteria
This task aims to assess your skill and analytical ability to examine issues involved in the problem scenario with adequate support and acknowledgement. Marks will be awarded based on the following assessment criteria:
- Originality of the work devoid of plagiarism
- Accurate identification of and analyse issues by using primary and secondary sources
- Critical evaluation and efficient use of information
- Concise and logical approach to address relevant aspects
- Clear demonstration of knowledge and correct written expression
- The degree of persuasion/depth of research evidenced from respective arguments
- Coherent organisation of the paper/ structured presentation of ideas
- Proper referencing and acknowledgement of sources
