Emergence of International Business and Legal Models 1) Developing economies like Brazil, Russia, India, and China have largely moved away from the American legal model towards the traditional civil law model due to issues with cost and complexity. 2) Civil law systems use an inquisitorial court approach and focus more on minimal human rights standards rather than elevated civil rights. 3) Likewise, business models have begun favoring international versions that are less regulated in response to laws like Sarbanes-Oxley, with some companies relocating from America to places like Mexico and Canada.

1. Emergence of International Business and Legal Models
In the world of globalization, a divergence from the established Western model of
business is occurring through the creation of an international model with principles that
are significantly different. The Western model dominated international business from
World War II through the 1980s and emphasized a more complex court system, high
standards of individual protection, and control over international trade.
Developing Economies Choosing Civil Law System
As globalization has evolved, the American (Western) model has become problematic
for the emerging economies and societies such as those of Brazil, Russia, India, and
China. In these developing economies, the American legal model has largely been cast
aside for the more traditional model of the inquisitorial civil law system. In the
inquisitorial court system, the court plays an active role. On many occasions, the court
will often act not only as the arbiter of the law but also as prosecutor. Also, the civil
court systems tend to focus more on minimal standards for individual protection such
as human rights rather than the more elevated standards of civil rights, diversity, or
equal rights. The developing economies have recognized that the expense associated
with the American-style court system would be prohibitive for many countries of the
world and have begun to follow a more streamlined version based in civil law. The
American-style court system is based on the common law system where a great deal of
weight (time and expense) is given to past court decisions as a guide to form present-
day and future laws.
Regulations Impact on International Business Models
Likewise, business models have begun to move away from American/Western-style
business systems and favor the international version of business models. One
significant example is seen in the resistance that foreign corporations put up to the
imposition of Sarbanes-Oxley regulations in the wake of business accounting and
financial reporting scandals. These regulations and others, which were imposed after
the events of 9-11, have caused many foreign companies to shift from doing business
in America. Some are locating their facilities in countries such as Mexico and Canada
where there are fewer regulations. Also, as multinational corporations have begun to
rise to dominance in the international business environment, the emergence of
international pay scales as opposed to domestic pay scales is seen. Multinational
companies operate independently of where their home office is located, and this has
created a greater need for international consensus and regulations.
Expense as a Driving Force for Change
As globalization continues to evolve, the international community may embrace these
international standards and move further away from the American/Western standard of
legal systems and court systems. The primary driving force for this change is expense.

2. As America becomes a primary debtor nation, it will become increasingly more
difficult to persuade the international community to follow that model when even an
economy as large as the U.S. economy cannot afford the expense of its model.
Another factor that will be driving this change is the cultural and historical differences
among the countries in the international community. As individuals progress, it will be
interesting to see exactly how far from the American systems the international
community will move in the future.