Unfair business practices encompass fraud, misrepresentation, and oppressive or unconscionable acts or practices by business, often against consumers and are prohibited by law in many countries. For instance, in the European Union, each member state must regulate unfair business practices in accordance with the Unfair Commercial Practices Directive, subject to transitional periods.
And, any business transaction between parties from more than one country is a part of international business. The buying and selling of goods, product or services across the national boundaries of a country are known as international business.
The law of unfair competition serves five purposes as:
First, the law seeks to protect economic, intellectual, and creative investments made by businesses in distinguishing themselves and their products.
Second, the law seeks to preserve the goodwill that businesses have established with consumers.
Third, the law seeks to deter businesses from appropriating the goodwill of their competitors.
Fourth, the law seeks to promote clarity and stability by encouraging consumers to relay on a when evaluating the quality of rival products.
Fifth, the law seeks to increase competition by providing businesses with incentives to offer better goods and services than others in the same field.
Although the law of unfair competition helps protect consumers from injuries caused by deceptive trade practices, the remedies provided to redress such injuries are available only to business entities and proprietors. Consumers who are injured by deceptive trade practices must avail themselves of the remedies provided by the state. In general, businesses and proprietors injured by unfair competition have two remedies: injunctive relief (a court order restraining a competitor from engaging in a particular fraudulent or deceptive practice) and money damages (compensation for any losses suffered by an injured business).