The law created by a legislature is called legislation, statutory or enacted law.

Rules with no or only weak binding force created by a legislature, or reputable

international organisation are called soft law or non-state law.

The governance gap is the situation in which it is in principle impossible for
national governments and legislators to control the behavior of MNCs.
The OECD (Organisation for Economic Cooperation and Development) guidelines
support the business world.

A supervisory body is a delegated enforcement authority. They are responsible for
supervising specific industries.

There are three main alternatives for litigation, collectively referred to as ADR:
arbitration, mediation, and conciliation.

Arbitration is the process, chosen by the parties, in which disputes are resolved by
one or more arbitrators. The arbitrators decision is binding on the parties and
enforceable. An arbitration clause in a contract means that the regular Dutch Courts
are no longer competent.

Mediation clauses in contracts do not break the courts competence.

Private law, also called civil law, is the rules that regulate the relationships
between individuals. Public law is the set of legal rule and principles that govern
the way the public authorities, including the government, use their powers.

The relativity principle means that an agreement can only result in obligations
between the parties involved. It is part of the four principles of contract law systems
(party autonomy, consensualism, binding, relativity principle).
Consensualism refers to the common intention to create an agreement. In general,
offer and acceptance are not subject to a specific form requirement.

Sources of law are legislation, case law, jurisprudence and unwritten law.

The legal system in a monist state assumes that the internal and international legal
systems form a unity. The dualist state assumes the opposite.

The rule of law or supremacy of law is not a precise concept. It suggest that the
state is being subjected to the law and the presence of an independent judiciary. The
rule of law increases the effectiveness of a jurisdictions private law system.

Open or vague norms are words which have no precise meaning, but which are
given a meaning by interpreting them within the context of the circumstances and
the people involved.

The European Commission, which has an executive function, has the right of
initiative.
The European Council defines the general political directions and priorities of the
European Union and provides the necessary impetus for its development. It consists
of the heads of state or government of the member states.

The Council, often referred to as the Council of the European Union, exercises -
together with the European Parliament - legislative and budgetary powers. It also
carries out policy-making and coordinating functions. The Council is composed of
representatives of each member state at ministerial level, authorised to commit
their government. The members of the Council are democratically accountable to
their national parliaments.

The principle of subsidiarity suggests that the Union does not take action, unless it
is more effective than action taken at national, regional or local level.

Green papers invite stakeholders to share their opinions with the Commission on a
particular issue. A white paper contains a Commission proposal of future EU
actions on a particular issue or in a particular area.

An exemption granted to a Member State that does not wish to join the other EU
Member States in a particular area in an example of opting-out.

Soft law instruments are often used to indicate how the European Commission
intends to use its powers and perform its tasks within its area of competence.

The EU did not legislate on corporate social responsibility (CSR) bit simulates it
as a voluntary concept. CSR is defined as the responsibility of enterprises for their
impacts on society.

Red tape is among the biggest obstacles to business in the Netherlands. Typical
examples include continuously changing rules, compliance and reporting duties and
unnecessary tests and inspections.

It is possible that a specific sign can be registered as a domain name but not as a
trademark.

A patrimonial right is a right with value. The mortgage right is a security right
which a company can give to a bank.

Product recall refers to the total of measures, including warnings and other
communications, aimed at having unsafe products returned from the distribution
channel(s) and from end users.

Cartels are anti-competitive arrangements.

In common law the term Act of God is used. The equivalent in civil law is force
majeure. Invoking force majeure under common law is in principle only an option
when agreed upon and precisely defined in the contract

A forum selection clause in an international contract allows the parties to agree
that any dispute resulting from that contract will be initiated in a specific court in a
specific country, or in case of a federation, a specific state.

If the parties make no choice with respect to the law applicable to the contract, the
principle is that the law of the country of the seller or service provider governs the
contract.

The Dutch Civil Code only applies to the issues not covered by the CISG. The CISG
sets out substantive rules of private law that are to apply only in an international
situation and offers an alternative for the application of substantive national law in a
cross-border case. The CISG regulates certain elements of international sales
contracts; but not everything. This means that for the subjects it does not regulate,
the rules of a national system are needed anyhow.

When a company wants to be sure the national law of its home country or another
country is applicable to a sales contract and not the CISG, the latter is to be excluded
using the opt-out opportunity of article 6.
One of the reasons for the exclusion is the fact that the avoidance of a contract
requires more than simply non-performance. Another reason to opt-out is that even
if the CISG is applicable, this does not mean that the whole contractual relationship
between the parties is governed by it. To fill this potential gaps it is advisable to
select a back-up domestic law anyhow.

The moment at which the ownership of the sold goods passes from seller to buyer
is defined by the applicable law.

International law prevails over national law. So if the CISG govern a particular
contractual issue, then domestic law is pre-empted. That is, the CISG provides the
exclusive remedy as to that issue.

In the case that no choice was made for applicable law, the defendant will be sued in
the courts of the member state in which he or she is domiciled (EEX regulation
article 2).

The Incoterms are the ICCs (International Chamber of Commerce) standard
commercial terms for the use in international contracts for the sale of goods. The
rules define for example which party to the sales contract has the obligation to make
carriage or insurance arrangements, when the seller delivers the goods to the buyer
and which costs each party is responsible for. The Incoterms do not deal with the
transfer of ownership of the goods, or the consequences of breach of contract. For
all the different forms of the incoterms see p. 187-190.

The thing that is delivered must conform to the sales contract. This is called the
conformity requirement. The conformity article is supplementary law and
companies thus have the freedom to deviate from it.

Default refers to the failure to fulfil a legal obligation.

The right of disposal means the right to alienate or encumber a property with a
dismembered right. Lack of disposition in principle means ownership cannot be
transferred.

The director can represent (in a legal sense) the company.

The Netherlands belongs to the legal family of civil law.

A community trademark (CTM) can be obtained by a single direct or indirect
application at the office for harmonisation in the internal market (OHIM).

The maximum duration of a patent is 20 years.
Under the Patent Cooperation Treaty (PCT) an inventor is able to file one
international patent application with the WIPO, and designate with that any or all of
the currently 146 PCT contracting states.

A copyright originate automatically for creative work.

A design right only applies on products.

The reservation of ownership is a legal tool to manage a non-payment risk (in
civil law) or retention of title (in common law).

Common law imposes no general duty of pre-contractual good faith. In civil law
jurisdiction managers should be aware of the potential liability for the damages
resulting from breaking off negotiations.