international corporations

International corporations are generally considered to be companies which administer international businesses.

Such international corporation are often referred to as multinationals, due to the multiple jurisidctions in which they do business. Insofar as English law is concerned, they are treated as either companies incorporated under the UK Companies Acts, or formed under a system of foreign law, depending upon how they are constituted. They are formed and operate in one of two ways.

In the case where a company is formed in a foreign State, that company is entitled to register an office in the UK under the UK Companies Acts. The business trading is the same legal entity formed in the foreign State. The foreign company owns the property of the business, and may enter into contracts in England, sue and be sued. Essentially, companies such as these are national companies trading internationally.

On the other hand, a foreign entity may elect to form a UK based subsidiary under the Companies Acts. Provided it is the UK company that trades in the UK (that is to say, enters in the contracts for the supply of goods or services), the foreign company does not trade in the UK, it is the UK subsidiary. As such the UK company and the foreign incorporated company each own their own property, and enter into separate contracts within the English jurisdiction. It may be the case that although a UK subsidiary has been formed under English law, that the foreign company trades concurrently with the local company in England.

Usage: The international corporation commenced trading in foreign jurisdictions in it own name, rather than forming local subsidiaries.

Related Words: jurisdiction; choice of law clause; jurisdiction clause; locus standi; litigation; forum non conveniens; contract; locus standi; privity of contract.