Help Ethics Volume book One !!!!!!

Hi guys In CFA Volume 1 , Ethical and Professional Standards book, pg 21 It says there are 3 different types of countries, and under the table applicable law it says the following: Member resides in NSL country, does business in LS country, LS law applies what does that really mean?? Firstly, I thought it was meant the stricter law will be the applicable law , but when I read more examples it says: Member resides in LS country, does business in MS country; LS law applies It really confusing for me hope you guys can help me :)cheers

Anyone one can help?

When two parties enter a business agreement/contract, they have to specify what law governs the agreement/contract between them. In the: “Member resides in NSL country, does business in LS country, LS law applies” it means a member residing in a country with no security laws does business with a member in a country with less strict (than the Code) security laws, and the agreement between the members says that the laws of the less strict security laws country applies for that business agreement. In fact, the Code applies in this case. In the: “Member resides in LS country, does business in MS country; LS law applies” it means that a member residing in a country with less strict security laws does business with a member in a country with more strict security laws. The business agreement between the members says that the laws of the less strict country apply, but since those are less strict than the Code, the Code applies. Check this out too: http://www.analystforum.com/phorums/read.php?11,694455,694531#msg-694531

I had a simmilar question, but for the one with the law of locality. I submitted it as a possible errata, and got this response from CFAi: ------------------------------------------- Thank you for your inquiry; the text is correct as written. The table in Exhibit 1 discusses hypothetical countries and sample situations. For example, if the LS country was Costa Rica and the MS country was Brazil, a member living in Costa Rica does business in Brazil. He lives by the laws of Costa Rica, but those laws state that the laws of the locality where business is conducted (i.e., Brazil) would govern. The situation in the first column is not determined by which country has more strict laws – it is merely giving a hypothetical situation. The second column (“Duties”) states which laws or Code must be adhered to, and the third column gives the explanation. I hope this helps. Regards, Wanda Lauziere CFA Institute ------------------------------------------------------------ This response prompted me to come up with the question that you have now. Basically, it’s not supposed to make sense, I guess.