examine the examples listed and discuss the implications (Advantages/Disadvantages) for such practices on FDI

Foreign investment lawsaffect FDI-based entry.

Examples:

Japan - The "large-scale retail store law" restricted foreigners from opening warehouse-style stores likeToys"R"Us, in favor of smaller Japanese retailers.

Mexico - Foreign oil companies cannot obtain 100% ownership of Mexican oil firms.

United States - Restricts inward investments seen to affect national security. e.g., The U.S. Congress blocked Dubai Ports World, a Middle Eastern firm, which sought a deal to manage U.S. ports.

Controls on operating forms and practicesare laws and regulations on how firms can conduct production, marketing, and distribution activities.

Example:

In the telecommunications sector in China, the Chinese government requires foreign investors to seek joint ventures with local firms.This ensures local control of the telecom industry; and China gains access to foreign capital and technology.

Marketing and distribution lawsregulate practices in advertising, promotion, and distribution.

Examples:

Finland, France, Norway, and New Zealand prohibit cigarette advertising on television.

Canada and other countries cap prices in the pharmaceutical and other industries.

Laws on income repatriationlimit the amount of net income or dividends that firms can bring back to the home country.

Environmental lawsaim to preserve natural resources, combat pollution, and ensure safety.

Contract lawsaffect the sale of goods and services; intermediary agreements; licensing and franchising; foreign direct investment; and joint ventures.

Example:

In Germany, firms are responsible for recycling product packaging.

Inadequate or underdeveloped legal systems, or poor enforcement of existing laws.

Laws may be weak regarding intellectual property, pollution, consumer protection, and other areas.

While the problem is common in developing economies, it can occur in advanced economies too.

Examples:

In China and Russia, foreign firms sometimes abandon business ventures due to erratic legal environments.

The recent global financial crisis was triggered partly by poor regulation in the United States and Europe