United States: Internet across borders — What law governs? - Global Compliance News

This legal article explores how national laws apply to cross-border internet activities, noting that while countries generally limit enforcement to their territory, they freely prescribe laws with extraterritorial reach when foreign conduct substantially affects their jurisdiction. The author explains that U.S. federal law constrains states’ ability to regulate out-of-state internet businesses through the Commerce Clause, while some cybersecurity laws explicitly define their territorial scope—such as California’s privacy laws that apply globally to companies collecting data from California residents. Companies can contractually choose applicable law for transactions, though mandatory laws like consumer protection, privacy, and competition regulations cannot be contractually avoided, making compliance analysis crucial for jurisdictions where businesses have physical presence, assets, or targeted customers. The article emphasizes that internet businesses face immediate exposure to foreign intellectual property laws, data privacy regulations, consumer protection requirements, and dealer protection laws, particularly when targeting specific international markets through localized websites, translated content, or physical product delivery. For cross-border operations, companies should prioritize compliance in jurisdictions where enforcement is most likely while using contractual choice-of-law clauses, geo-targeting restrictions, and careful distribution models to manage legal risks across multiple regulatory environments.​​​​​​​​​​​​​​​​