Explain the objective theory of jurisdiction How does it app

Explain the “objective theory of jurisdiction.” How does it apply to an organization doing business within a foreign country?

Solution

According to this theory, any person will remain to the citizen of his parent country and the person will be always be subjected to the court of laws in his parent country. As per this theory, an American citizen will remain to be the American citizen, even if he or she is working in a firm operating in the foreign country and will be subjected to the American courts of law.

If a firm is doing business within a foreign country, then:

1. The trade that affects the parent country, will be subjected to the jurisdiction of the parent country. For example, if it is the US firms and the trade affect the USA, then it is under the jurisdiction of the USA court of law.

2. The firm has to work upon the two sets of laws. The one set of law belongs to the foreign market where the firm is operating. The second set of law belongs to the domestic country where the firm belongs to.

3. Firm belonging to the parent country, does not mean that the firm has the freedom to do anything that is against the law of the country where the firm is operating.