international law, each country utilizes its own courts to settle disputes. Collective action, reciprocity, and
shaming are three examples of non-legislative methods that influence trade when enacted against nations
that violate international law.
Figure 13.4
International laws are enforced through positive and punitive measures that seek to uphold the
global integrity of trade and commerce among all nations. (Credit: qimono/ pixabay/ CC0)
Sources of International Law
The sources of international law are customs, treaties, and organizations, as discussed in the previous section.
These three components work synergistically to influence how the international community facilitates
business trade and commerce. More importantly, international law is enforced when a country violates the
principles set forth by globally shared customs, treaties, and organizations.
One of the most important governing documents for international law is the United Nations Convention on
Contracts for the International Sale of Goods (CISG), which was established in 1980. This law governs
contracts of countries that have ratified it as the priority contract for trade. By January 2018, 84 countries had
adopted CISG, including the countries that account for more than two-thirds of all global trade. Those
countries include the United States, Canada, China, Japan, Mexico, Argentina, Brazil, and most European
countries. The CISG is enforced whenever international transactions occur without the presence of written
contracts to govern those transactions. There are limits to the CISG, however, as the CISG does not apply to
consumer sales or contracts for services (Clarkson, Miller, & Cross, 2018, p. 376).
International Principles and Doctrines
There are three significant principles that help establish and enforce international law: the Principle of Comity,
the Act of State Doctrine, and the Doctrine of Sovereign Immunity.
The Principle of Comity states that nations will defer to the laws and decrees of other nations when those
laws are consistent with their own, essentially upholding reciprocity between nations with similar laws. For
example, a U.S. court will most likely uphold a business contract as valid even if it was drafted in England, since
the United Kingdom’s legal procedures are consistent with U.S. procedures (Cross & Miller, 2018, p. 216).
The Act of State Doctrine is a law applicable in England and the United States. It states that these two nations
146
Chapter 13 International Law
This OpenStax book is available for free at http://cnx.org/content/col30149/1.5