Global Gotchas

How to avoid hidden traps in international laws.

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"If you want to do a reorganization [or] downsizing or change the terms of their employment, such as location, you actually go to [the councils] with the request for advice," he explains.

Employee councils, which enjoy particularly strong legislative support in France, Germany and the Netherlands, can come back with support for a plan or questions about it. They can even delay action, Crotts says.

2. Privacy

European laws require much higher levels of data security and privacy, even as they apply to accessing employees' information. For CIOs familiar with only U.S. requirements, such restrictions may seem daunting.

"IT people are constantly surprised that their systems have to be adjusted to accommodate data protection, data transmission or other security issues," says Mark E. Schreiber, chairman of the privacy group and a partner at Edwards Angell Palmer & Dodge LLP in Boston.

CIOs need to have systems that protect data and prevent illegal transfers of information, even within the company, Schreiber explains. For example, European privacy laws could prevent an HR official in France from e-mailing salary information to the CEO in London, even though such data-sharing is perfectly acceptable in the U.S.

Consider, Crotts says, that when compiling a list of its project people and their skills, his company first had to get employees to sign forms saying it was OK for their data to be used in such a manner.

3. Procurement

Blakeslee and her IT clients have learned that some clauses that are standard in U.S. contracts aren't much good elsewhere. So the protections built into legal lingo such as "liabilities," "trade secrets" and "confidential information" don't necessarily hold up in other countries, even if the words themselves are written into contracts.

For example, CIOs buying customized software overseas are often surprised to learn that the rights to software can't be assigned in some countries, so a vendor could legally sell that custom design to a competitor, Blakeslee says. So when she writes contracts for her IT clients, Blakeslee includes 99-year leases or noncompete clauses and explicitly spells out that the vendor can't sell the proprietary information.

"You can get where you want to be, but the language you rely on [in the U.S.] doesn't necessarily get you there," Blakeslee says. "The company really needs to think about, 'What do I need here?' "

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