LEGALality IN THE GLOBAL BUSINESS ENVIRONMENT
Differences in national legal systems may not be as immediately obvious as cultural differences, but they can have a profound effect on international business efforts. For instance, the legal systems in the United States and the United Kingdom are based on common law, in which tradition, custom, and judicial interpretation play important roles. In contrast, the system in countries such as France and Germany is based on civil law, in which legal parameters are specified in detailed legal codes. One everyday consequence of this difference is that business contracts tend to be shorter and simpler in civil law systems, since the existing legal code outlines more aspects of the transaction or relationship. A third type of legal system, theocratic law, or law based on religious principles, predominates in countries such as Iran and Pakistan. Beyond the differences in legal philosophies, the business of contracts, copyrights, and other legal matters can vary considerably from one country to another.