Legal Systems

Americans derive their legal system from the British common law. Such "law" was "unwritten" since enforceable rules of conduct were developed over centuries of jurisprudence by judges resolving individual disputes. Serving as a "gap-filler," common law supplements constitutional, statutory and contractual rights. Judicial decisions in one case become stare decisis, binding as precedents on lower courts in the same jurisdiction, and relied upon collaterally by courts in other jurisdictions or at the same level as persuasive but not binding.

Europeans, Japan and Latin Americans derive their legal system from the Napoleonic Code of the early 1800's. Under this theory, legislation is the sole source of law, and judges in one dispute may not dictate binding principles of law of general precedential value.

Other legal systems govern other countries, such as in the Arab world or in China.

In international outsourcing, comparative legal systems need to be understood at all levels, from planning to negotiation and implementation of the contract. For example, one legal tradition might rely on short, concise contracts. Other systems might not like long contracts, which may be construed as cultural encroachment as well as lack of trust.

Additional Resources

Business and Social Cultures
Political Risk
Taxation
Financial Systems and Currencies
Logistical Infrastructures
Time Zones
Dispute Resolution Processes