When one is involved in international trade, there are a couple of factors mainly legal which one must put in consideration A case in pint is for instance when you are exporting from China and the country of import is Russia. The first thing that you will need to consider is the fact that the ideologies that China and Russia share are different. While China may be highly opposed to certain aspects of running affairs, Russia seems to be in full support of such ideas (Whale, 1996). One will therefore need to consult international law in order to know which law will be applicable incase a dispute arises.
One will also need to choose a shipping company which could be from either the exporting or the importing country. The important factor to consider in this case is the rate that is being offered as one would as much as possible want to save on cost. Another factor that one would want to out into consideration is the facts that since Russia and China do not exactly share some ideologies; it may prove difficult for a person trying to export from China to Russia (Grimwade, 2010). For this reason, it is always wise to look for a company that well known in China as it will help facilitate the process of importation.
When in the business of exporting and importing, it is always necessary to draft a contract mainly to ensure that you are protected. When doing so, the laws of either country may apply. It is however more advisable that the laws of your country should apply and not of the foreign country (Hobson, 1999).
Choice of currency is yet another important factor. One is advised to go for a currency that will tend to favor them in terms of exchange rates. The dollar has remained an all time favorite for most exporters and importers. However, one may go for a currency that tends to favor them so that they may end up incurring less cost. It is also important to be aware of the letters of credit and how they operate. A letter of credit is mainly used in international trade. This is mainly for trades that involve large amounts of money. In this particular case, a letter of credit will be necessary as it is the most convenient (Hobson, 1999).
Letters of credit are issued by banks which always act as intermediaries between the buyer and the seller. The letter of credit mainly is mainly used by importers and exporters for purposes of protection. It is also important that as you carry on with your business of import \s and exports to recognize the need to know various federal laws and especially those that are in relation to international trade. One such law is the Export Act which clearly stipulates the rules and regulations that govern export of goods and services (Grimwade, 2010).
In terms if agreement, this business will not be under any particular agreement considering that China and Russia do not have as many common ideologies. However, since the two countries are members of international community, then such a business will be under the international treaty and therefore will be governed by the provisions of the international treaty (Whale, 1996).
It is important for any business person who wants to venture into international trade to ensure that they are well versed with all the requirements of the trade as it will become easier to trade.
Grimwade, N. (2010). International Trade: New pattern of trade, production and
investment. London: SAGE.
Hobson, J. (1999). International Trade:An Application of Economic Theory. London: SAGE.
Whale, B. (1996). International trade. New York: Taylor & Francis.