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Political problems

The stability, civil society and the general state of the political map within a country can all impact on the success of new entrants to an overseas market. Some governments may be protectionist in that they have significant barriers to entry of both new firms and their products.

Barriers may exist in terms of the awarding of trading licences as well as a whole range of international trade barriers such as quotas, tariffs, embargoes and subsidies for local competitors.

A firm must adapt its products to local laws and customs. In Islamic countries, the law forbids use of animal fat. Some countries forbid the inclusion of non-sugar sweeteners and food preservatives. In India, terms such as 'Giant' and 'King Size' are prohibited as misleading. In Venezuela, prices must be stated on the product; in China this is illegal.

Accounting techniques, ownership, land tenure and many other legal aspects of business life also differ from one country to another.