Question

________ is the risk that the host government will take specific steps that prevent the foreign affiliate from exercising control over the firm's assets.

Answer 1

________ is the risk that the host government will take specific steps that prevent the foreign affiliate from exercising control over the firm's assets.

Expropriation

What is expropriation ?

Expropriation is when a government seizes privately owned property against the owners' will, presumably so that it can be used for the general welfare of the populace. Properties are most frequently taken in the United States in order to construct roads, trains, airports, or other infrastructure projects. Since the Fifth Amendment of the Constitution prohibits the expropriation of private property "for public use without just compensation," the property owner must be compensated for the seizure.

So, Expropriation is the risk that the host government will take specific steps that prevent the foreign affiliate from exercising control over the firm's assets.

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