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The Long Arm of the Law or the Invasive Reach of the American Legal System

Author: Blake REDDING

Type: Article

ref: 52007659-667

N0:5 of 2007

Pages: 659-667

The impact, often unexpected, of American regulations on the economic life of non-American enterprises can have repercussions far beyond what one would expect. Even though most executives of the thousands of enterprises which are potentially subject to these regulations are aware of the possible extent of American sovereignty, they would commit a double – and perhaps fatal – error if they do not take into account the risks arising out of the reach of not only American regulations, but also the jurisdiction of American courts.

« The long arm of the law » is an expressions with its origins in the « westerns » where it referred to an implacable justice, determined to trackdown and punish the « bad guys », even in the far reaches of the Wild West. This noble motivation has been changed – degraded? – into a legal term referring to the jurisdiction of courts. Perhaps the current tendency to expand the judicial and regulatory reach finds its roots in a quest – a bit romantic – for justice … even if other more harsh and cynical explanations can or should also be used. But, regardless of the reason, it is essential that multinational enterprises remain vigilant and prepare themselves for a real risk which continues to grow.