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Commerce releases study on litigation, direct foreign investment

The Department of Commerce has released a new paper, "The U.S. Litigation Environment and Foreign Direct Investment," documenting, among other things, the perception overseas that the United States is excessively litigious. A highlight:

Fear of litigation is among the top issues listed by senior executives who manage internationally owned U.S. businesses. Significantly, U.S.-owned companies that operate in other advanced economies do not express a similar concern. Also, there is the perception that, at least in some contexts, other countries' legal systems are more predictable and that the legal costs of doing business are substantially less. These perceptions exist even though the overall high quality of the U.S. legal system is also well recognized internationally.

The report calls for more analysis in several areas, including the deterrent effect of the legal climate on foreign companies not yet doing business in the United States, as well as a better delineation of which aspects of litigation have the greatest deterrent effect on direct foreign investment.

Secretary Carlos Gutierrez spoke about the new report, litigation and the business climate at theU.S. Chamber of Commerce's 9th Annual Legal Reform Summit, Oct. 29th. His remarks are here. The Chamber's Legal Newsline reported on his speech.



Rafael Mangual
Project Manager,
Legal Policy

Katherine Lazarski
Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.