Reasons to Learn Business Laws Before Expanding Globally

One of the primary goals of many business owners is to expand their operations into different areas. While this may be easier to accomplish when this expansion is local, a global presence can offer immense opportunities. However, it may take a great deal of knowledge before committing to opening a new location in a foreign country. The same laws in your current area may more than likely be completely different in an overseas locale.

Product Availability

Not every country has access to the same materials. You may find that your business dynamic may rely on something that needs to be imported. Not having the right materials on hand could create a slew of other problems, and you need to be certain that your company is capable of thriving within this new environment. The last thing you’ll want to do is produce something that is illegal in that particular country.


Many companies finance their overseas investments with acquired capital. However, some businesses may not be able to directly afford building into a foreign country without financial backing. It may be more difficult in some countries than it is in others to obtain this financial assistance. The laws regarding loans are not universal, and some stipulations may be more strict than experienced in other areas. This may also include the laws centering around general banking.


Before setting up a business on foreign soil, you should have an idea as to how taxes work in that area. Taxes are another component that is not universal, and you’ll need assistance to learn what each area needs in terms of payments. For example, the United States has a convoluted system that requires state, city and county taxes in some areas but not in others. This is important information to understand as a lapse in paying taxes on your business could result in everything from fines to actual jail time.

Employee Procurement

There is a great deal that goes into obtaining employees for the business. While you could promote people in-house and ship them overseas, you may have to rely more on the local populace. When it comes to keeping staff on hand, there are a great deal of concerns that will have to be met. Insurance, taxes and more can play a role in legal employment. Not every area has the same laws in regards to things like social security or worker’s compensation. You need to know what mandates are required for hiring people in those new countries.

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Sales and Wages

What a product or service sells for in one country may not be easily ported to another. This means you’ll need to spend time figuring out currency exchanges and what can be viewed as a fair price. This may play heavily in what you pay your employees as it may alter how you do business in the new location. You need to make enough money to pay employees, but too much may decrease the amount of sales performed. For instance, what may seem reasonable in the United States may seem too expensive in European countries.

Customs and Embargoes

One of the most important aspects to consider when branching into new countries is the effect of customs and various embargoes. Some countries may have taxes, fines or other fees attached to shipping goods from another country. A good example of this is the embargo that was established on Cuba decades ago by the United States. A tobacco-related business in New York would not be able to sell Cuban cigars because of this embargo. In fact, owning such property was deemed illegal.

There is a great deal of information you’ll need to understand before branching the business across the globe. Many professionals, such as Shahram Shirkhani, learn all they can about various international laws in order to prevent problems from arising. Money isn’t the only thing that’ll be invested in a grand project such as incorporating overseas holdings. The time put into the project won’t be recoverable should you make a mistake concerning local laws.


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