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The Public-Private Law Divide, Essay Example

Pages: 2

Words: 656

Essay

Logistics and Services Company’s decision to enter into the South American market will be hampered by the political unrest in the region. Firstly, it is imperative to consider the fact that when there is political instability, the value of the local currency is likely to be devalued thus leading to the poor performance of the economy (Sell, 2003). Secondly, in the event that there is intense political unrest, the business ventures such as the one that Logistics and Services Company will likely create will be hit by limited customer base as well as a serious threat of vandalism and malicious damage by the locals. This is in spite the fact that this business opportunity will translate into job creation for the locals in South America.

It would therefore not be advisable for Logistics and Services Company to move into South America and setup its exploration, drilling, refining, and transport division. The threat of damage is too big to ignore. In this regard therefore, Logistics and Services Company should consider moving into other areas of South America that are relatively safe and enjoy political stability.

There are several legal and ethical risks as well as benefits that Logistics and Services Company would have to deal with in order to operate in South America both in the short-term and long-term respectively. Perhaps the first major legal risk is the licensing of the foreign company in an area where local companies hold a strong monopoly. This would be a problem both in the short-term and long-term. Logistics and Services Company will best deal with this through negotiating with local oil exploration firms for a franchise which would lure them into accepting the entry of Logistics and Services Company into the South American market. Moreover, South America is a region that continually fights drug abuse. Thus, creating job opportunities would effectively reduce the dependency and trade in drugs by the locals.

In addition, the entry of Logistics and Services Company into the South American market would mean that there shall be increased job creation for the local members of community. This will thus have reciprocal ethical effects as the locals working in the factories setup by Logistics and Services Company will be able to earn a living and thus live a decent life. The company will hence effectively contribute towards reducing the rate of poverty. According to Ruffert (2009), many foreign businesses usually bolster the local economies thus enhancing the standards of living of the locals.

The setting up of Logistics and Services Company’s operations in South America is likely to have certain ethical risks. Since there is likely to be increased employment and the establishment of estates where the employees would mostly be living, prostitution and theft is likely to be rifer (Oliver, 2009). Thus in the long-term, these social evils are likely to become a headache to the society.

It is imperative that Logistics and Services Company acquires all the necessary licenses in order to operate effectively. Therefore, if the company is setting up a division for the exploration, mining and transport, it would have to sort for a legal operating license from the Department of Energy and the Local Municipal Council of that country, say Brazil. Furthermore, Logistics and Services Company would also have to acquire a license from the Environmental Control Authority in Brazil.  This would enable the company to commence its operations. Perhaps the last and final license would be the license from the Energy Regulatory Commission. This is a local energy regulating body that operates in the specific country in South America, say Brazil. It is estimated that in order to operate an oil exploration venture, Logistics and Services Company would have to acquire at least four different licenses.

References

Oliver, D. (2009). Common values and the public-private divide Cambridge: Cambridge University Press.

Ruffert, M. ed. (2009). The public-private law divide: potential for transformation? Berlin: BIICL.

Sell, S.K. (2003). Private power, public law: the globalization of intellectual property rights. Cambridge: Cambridge University Press.

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