July 4, 2007  nº 510  -  Vol. 5  
 

"Wise it is to comprehend the whole."

Edward Young (1683-1765)


 "Happy 4th" to our readers who celebrate the 4th of July, that glorious and ever memorable day, celebrated through America  by the sons of freedom.

The Declaration of Independence

We hold these truths to be self-evident,
that all men are created equal,
that they are endowed by their Creator with certain unalienable Rights,
that among these are Life, Liberty and the pursuit of Happiness.

With these memorable words, Thomas Jefferson, at the age of 33, laid the cornerstone of the United States of America.

In today’s Grammatigalhas: Made in China, sued in the US or the product liability issues from globalization.

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  • Top News

Brazil launches slum reform drive

The Brazilian government has pledged $1.7bn  to improve conditions in Rio de Janeiro's shantytowns and counter the grip of the drugs gangs. Lula said that investing in running water and other basic services was the best way to beat organized crime. He also defended police action in the slums just days after 19 people died during a major raid against the gangs. More than one million people live in Rio's sprawling slums. "If the state doesn't fulfill its role and does not provide (adequate) services for the people, drug traffickers and organized crime will. We want people to have road access, street lighting, hospitals and schools."

'Slave' laborers freed in Brazil

More than 1,000 laborers have been freed in Brazil by the government's anti-slavery team. They were said to be working in inhumane conditions on a sugar cane plantation in the Amazon. An ethanol-producing company which owns the plantation has denied allegations of abusing the workers. Human rights and labor organizations believe that between 25,000 to 40,000 people could be working in conditions akin to slavery in Brazil. Many farmers in the Amazon region who incur debts are forced to work virtually for free in order to repay the money they owe. Labor ministry officials and prosecutors discovered more than 1,100 workers working 14 hours a day and living in conditions described as "appalling". It is the largest such raid in Brazil, a country beset by the problem of slave labor. Officials said that the laborers lived in overcrowded conditions with no proper sanitation facilities.

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  • Crumbs!

1 - Slavery team frees 1,100 Brazil workers. (Read more)

2 -Arizona Governor signs tough bill on hiring illegal immigrants. (Read more)

3 - Clues to the new dynamic on the Supreme Court. (Read more)

4 - Keeping patients’ details private, even from kin. (Read more)

5 - A slippery, writhing trade dispute. (Read more)

6 - Merkel unveils climate plan, alarms industry at costs. (Read more)

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  • MiMIC Journal

China strikers 'beaten by thugs'

A group of armed men attacked as many as 300 migrant construction workers who were striking over unpaid wages, Chinese media reports. At least one person is reported to be fighting for his life and six others were injured in the clashes in Heyuan city, in Guangdong province. China's construction minister has ordered an immediate investigation. China has faced a number of recent cases involving alleged worker abuse.

China 'buried smog death finding'

The World Bank is alleged to have cut from a report research that suggests pollution causes hundreds of thousands of premature deaths annually in China.

The move followed pressure from Beijing, which believes the material is too sensitive and could lead to social unrest.  It said information was cut from the forthcoming report after requests from two Chinese government departments.

  • Grammatigalhas

Legal Meaning Is Not Everyday Meaning

Tort

In general, a civil wrong, other than breach of contract, for which a court will provide a remedy in the form of a suit for damages. Torts include negligent acts or omissions on the part of a defendant. Liability insurance is designed to cover an insured (defendant) for unintentional tort acts.

Negligence

Lack of due care or failure to do what is reasonable and prudent under the circumstances. Omission of something that a reasonable person, guided by those considerations that ordinarily regulate the conduct of human beings, would do, or doing something that a prudent, reasonable person would not do.

Implied Warranty

One that is not written but exists under the law. Contrasted with "expressed.” Example: Under the law in several states there is an implied warranty of habitability for apartments leased to tenants. This means that the tenant has the right to a dwelling that is fit for living, i.e., there are no Building Code violations.

Everyday “Legal” Jargon

Product liability issues arising from the Chinese business

With China’s entry to WTO, the trade between the United States and China will be increasing. More and more Chinese products are being marketed in The US and vice versa. The product liability law suites for products designed and/or produced in one country but sold and used in the other are increasing. Due to the differences of legal system between China and the US, the product liability systems of them are not the same. 

It’s very important for companies of one country to understand the product liability system of the other’s if they are going to sell their product in the other country’s market. 

In 2000, the People’s Republic of China on Product Quality was amended. In 1998, the final Draft of the Restatement (3rd) of the US was approved and published. The comparison of the product liability systems will provide guidance to companies of the both countries to understand the legal environment that their products are facing and how to respond accordingly. It can also provide guidance for Chinese product liability reform in the future.  

Comparison of the Product Liability System 

The law and legal system of the United States evolved from the British legal system. The development of the product liability system generated three theories, negligence liability, warranty theory and strict liability in tort. Strict liability began with a landmark case Greenman v. Yuba Power Products, Inc. in 1963 in California. From then on, many manufacturing companies in the US were badly knocked to their knees by the product liability lawsuits and lost millions of profit. It is estimated the product liability costs government, manufacturing and insurance companies over $100 billion annually, more than the profit of the United States top 200 corporations and it continues to mount [3]. Obviously product liability is one of the most controversial topic now in the US. There are many claims to reform product liability system[. Anyway, the emergence of strict liability theory is far-reaching. Many countries in the world have adopted it including Europe, Japan and China. 

In China, there were very few product liability lawsuits before the 1990s, and there was no specific law to deal with product liability cases. There is only one article (No.122) in “The Principles of Chinese Tort Law” saying that the producers and sellers are liable for the property damage and personal injury caused by defective products. Before 1990s China was in a state of scarcity of economy and the producers and sellers dominated the market. Product quality was very low at that time and there were many forgery products. Even though there were many accidents caused by the defective products or forgeries, many plaintiffs were not able to get their losses recovered. The scarcity of economy ended in the early 1990s and consumerism began to develop. There was a big demand for protecting the legal right of consumers. To strengthen the supervision and control over product quality, to improve product quality, to define the liability, to protect the legitimate right and interest of users and consumers and to safeguard the economic order, China adopted “The Law of the People’s Republic of China on Product Quality” in 1993 and in the same year enacted “Law of the People’s Republic of China on Protecting Consumer’s Right and Interests”. In 2000, the product quality law was amended. Currently the settlement of product liability cases is mainly based on the law of product quality.  

In fact, China has not much experience in dealing with product liability and it does not have so many product liability lawsuits as the US does. When enacting the law, China learned the experience from the western countries. Due to the gap of economic development between the US and China, Chinese product liability system has some differences from that of the US. The purpose of the comparison is not to find out which one is better than the other, but to provide mutual understanding. The authors strongly believe that with the economic development of China, its product liability system needs further reform.  

Comparison of the Scope of Products 

The scope of “product” in the US is quite broad. Product liability has extended tangible goods to include intangibles such as electricity after it has been delivered to the consumer. In deciding whether the law of product liability should apply, the issue should not be restricted the inquiry of whether a product is involved. Rather the inquiry should be directed to whether or not the defendant is in the best position to spread the loss and prevent injuries. 

“Product” referred in Chinese product quality law means a product which is processed or manufactured for the purpose of sale. The law does not apply to construction projects, but the materials and facilities used in the construction are applicable. Any products such as raw minerals that are not processed or manufactured are not included. Even though the definition of product here in China seems quite specific and clear, there are some debates on the definition of “being processed or manufactured”. Generally raw agricultural products are not included. As we can see, the scope of “product” in terms of product liability in the US and China is quite similar. The scope of the US is much wider. For software product and other intellectual product, there is no statutes or explanations in Chinese law. 

Defect Identification

Determining if a product has defect is one of the most difficult and time consuming problem in a product liability lawsuit. In the US, a defective product means that the product is “in a defective condition unreasonably dangerous tothe user or consumer”. Defect is generally classified into three types: 

(1) Manufacturing defect meaning that product departs from its intended design. If a product has manufacturing defect, strict liability theory is applied and there is no requirement that the plaintiff prove the departure rendered the product “unreasonably dangerous” (Restatement3rd ). 

(2) Design defect meaning the foreseeable risk of the product could have been reduced or avoided by the adoption of a reasonable alternative design. If the plaintiff can present a practical and technologically feasible design without having to present a prototype, the product is proven to be defective based on strict liability theory. 

(3) Warning and instruction defect standing for the defect that could have been reduced or avoided by the provision of reasonable instructions and warnings.

In Chinese product quality law, defect is defined as “the unreasonable danger existing in a product which endangers the safety and human life or another person’s property, where there are national or trade standards with a view to safeguarding the health of people and safety of human life and property, defect means any inconformity to such standards”. The first part of the definition is quite similar to that of the US. The latter part adds some ambiguity in determining defect. It brings about advantages as well as disadvantages. One advantage is that it is easy to identify the product to be defective if it is proven to be inconformity to a certain standard. The disadvantage is that if the product has reached the standards but caused damages or injuries, it may be very difficult for the plaintiff to prove that the product is defective and it’s easy for the defendant to defend. In addition, because some standards are first established by the manufacturers and then adopted and approved by the government or agencies, it is not advantageous for consumer protection. Another confusion is that in some cases inconformity to standards does not necessarily means the product is defective, and it may not cause damages or injuries. It is an inferior product rather than a defective one. 

Liability Parties and Exemption 

Parties subjected to product liability in the US can be any persons from product design to the delivery or installation of the product. Any party can be sued on any of the liability theory. In China, the scope of the law includes activities of production and sale of products conducted within the territory of the People’s Republic of China (Hong Kong and Macao are not included). Based on chapter 3 of product quality law(liability and obligation of producers and sellers concerning product quality), negligence theory is applied to sellers and strict liability to producers. There are no regulations on the liability of business entities that are successors to the manufacturers or that are apparent manufacturers. Both liability systems allow for development risk defense (state of the art defense). The producer or seller can also defend themselves if the product has not been put in circulation or the defect causing the damage did no exist at the time when the product was put in circulation. 

Damage Compensation 

Damage compensation is the key point of product liability lawsuits. In the US, different states have their own product liability law and damages compensation could be quite different for a similar case from state to state. In general, the compensation includes economic damages and non-economic damages such as pain and suffering, emotional distress and punitive damages. With more and more criticism of the US product liability system, some states have enacted statutes placing a cap on the amount of non-economic damages.

Damage compensation in China is rather low compared with that of the US. Generally it only includes economic damages. Even though some plaintiffs claimed for emotional distress recovery, the court did not approve it. There is no punitive damage either. 

Legal Environment 

Some authors claim that the US is the most litigious country in the world[3]. In fact, the product liability system in the US is well developed and comprehensive. Also the US legal environment makes it easy for one person to sue another. The high damage compensation and plenty of lawyers are two important factors contributing to the flourishing of product liability lawsuits. On the contrary, in China there are not many product liability lawsuits. 

There are many reasons for this. First, Chinese people don’t have strong legal consciousness. Second, the damage compensation is not so lucrative as that of the US and the court process is time consuming. Third, the bureaucratic practice of some courts and local government protection for its local companies make it very difficult for the plaintiff to get recovery from the court. Besides the legal system, News media play an important role in the settlement of product liability lawsuits as well as customer protection. In the US, 96% of the product liability cases were settled out of court. Most companies are afraid of being exposed of product liability cases, which will bring bad effect to its business image and marketability. This loss will be much bigger than the damage compensation ruled by the court. This is true both in China and the US. 

The Chinese Product Liability System 

Due to the gap of economic development and the overall product quality level between the US and China, China cannot fully adopt American product liability system. But the current product liability statutes in Chinese product quality law are too general. Many key points in product liability lawsuits are not covered or addressed. To meet the requirements of economic globalization and to protect the consumer’s legitimate right and enforce producers and sellers to improve product and service quality, the authors present the following suggestions for Chinese product liability reform.

(1) Expand the scope of liability parties. Currently the product quality law only applies to the producers and sellers within China. It is not applicable for Chinese consumers to sue a foreign manufacturer for product liability recovery. Now more and more foreign products are being sold in Chinese market and sellers only have negligence liability. It is not easy for Chinese consumers to sue foreign manufacturers.

(2) Liability of business successor should be addressed. With the rapid economic development of China, business merge or taken over by another company is quite common. In the current Chinese law, there are no statutes about liability of business successor. This is disadvantageous to consumers and users.

(3) Identify the liability of apparent manufacturers and actual manufacturers. OEM manufacturing is now very common in China. But in Chinese product quality law, there is no explanation about what “producer” really means. The general practice is that the producer includes actual manufacturer (who actually manufactured, processed or imported the product) and apparent manufacturer (who put his name or trademark on the product). Apparent manufacturer should have the same obligation as the actual manufacturer in product liability cases unless there is an agreement between them saying the actual manufacturer is liable.

(4) Identify the liability of suppliers. In many companies especially assembly-type manufacturing companies, material or part quality has a significant impact on final product quality and many product defects are caused by the materials or parts from the suppliers. Which liability theory should be applied for suppliers has not been included in Chinese quality law. 

Conclusion 

In the United States, product liability is a controversial topic. But the product liability system in the US is the most comprehensive and detailed. The purpose of the research is to provide mutual understanding the two product liability systems. Based on the comparison, the authors point out the inadequacies of Chinese current product liability system. In fact, the main purpose of enacting product quality law in China is to force companies to improve quality and punish forgery and other malpractice. So product liability issue was not fully addressed in this law. With the economic development and increasing of legal awareness of the public, product liability problems will cause more attention in the future.

As If Your Life Depended On It...or How to get to Carnegie Hall? - Practice, practice

Chinese fire drill

Chaotic situation, especially one involving a group's incompetence in carrying out instructions or a plan. Usage of this expression now seems confined to the USA; although it is supposed to have UK origins, and various sources state it being in use on both sides of the Atlantic after World War I. The expression supposedly derives from a true navel incident in the early 1900s involving a British ship, with Chinese crew: instructions were given by the British officers to practice a fire drill where the crew members on the starboard side had to draw up water, run with it to the engine room and douse the 'fire', at which other crew members (to prevent flooding) would pump out the spent water, carry it away and throw it over the port side. After initially going to plan, fuelled by frantic enthusiasm as one side tried to keep pace with the other, the drill descended into chaos, ending with all crew members drawing up water from the starboard side, running with it across the ship, entirely bypassing the engine room, and throwing the un-used water straight over the port side. It's certainly an amusing metaphor, if these days an extremely politically incorrect one. It's akin to other images alluding to the confusion and inconsistency that Westerners historically associated with the Chinese language and culture, many dating back to the 1st World War. 

Other expressions exploiting the word Chinese to convey confusing or erratic qualities:

Chinese whispers: (confused messages), Chinese ace: (inept pilot), and Chinese puzzle: (a puzzle without a solution); Chinese fire drill is very much part of this genre.

Biweekly / Semiweekly

Technically, a biweekly meeting occurs every two weeks and a semiweekly one occurs twice a week; but so few people get this straight that your club is liable to disintegrate unless you avoid these words in the newsletter and stick with “every other week” or “twice weekly.” The same is true of “bimonthly” and “semimonthly,” though “biennial” and “semi-annual” are less often confused with each other.

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  • Historia Verdadera

Barra comercial

La Asociación de Industriales del Plástico (Asipla) de Chile dio un plazo de 15 días al gobierno de su país días para que la Comisión Nacional de Distorsiones aplique una barrera comercial contra sus competidores argentinos, de los cuales sus importaciones se han incrementado en un 68%. Los productos más afectados son las bolsas y el film.

Apuesta

“Va a hacer un gobierno mucho mejor que el que hicimos hasta ahora”, dijo el presidente Néstor Kirchner en una nueva apuesta por la candidatura de Cristina Kirchner a la presidencia de Argentina, en los comicios electorales de octubre.

Constituyente

La Asamblea Constituyente de Boliva aprobó ampliar hasta el 14 de diciembre su mandato para redactar una nueva Carta Magna. Reconociendo la imposibilidad de analizar más de 700 proyectos de artículo en su plazo inicial, que vencía el 6 de agosto próximo.

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  • Brief News

Bush not ruling out Libby pardon

Bush has refused to rule out pardoning former White House aide Lewis "Scooter" Libby, convicted over a CIA-leak case. Bush commuted Libby's 30-month jail sentence on Monday, drawing criticism from political opponents. House Speaker Nancy Pelosi said the move showed Bush condoned criminal conduct, and Hillary Clinton said he elevated cronyism over the rule of law. Libby must still serve a two-year probation and pay a $250,000 fine. On Tuesday Bush declined to rule out a complete pardon for Libby at a later time.

Sexy clip lifts EU YouTube debut

When the EU opened its own channel on YouTube, no-one could have predicted it would get upwards of 20,000 hits a day. But while videos on the CAP and road safety are barely getting touched, a clip of sex scenes from European cinema has become a runaway success. Titled Film Lovers Will Love This!, it shows men and women having sex in different ways and places, and ends with the words, "Let's come together".

Supporters say it celebrates European cinema, but others term it "soft porn".

Parmalat to face US group lawsuit

Italian dairy firm Parmalat can be sued by shareholders in a lawsuit concerning the collapse of its predecessor, a US judge has ruled. The judge rejected a request by "new Parmalat" to dismiss a group lawsuit by shareholders seeking compensation. Parmalat officials said they planned to appeal against the ruling. US district judge Lewis A Kaplan declined to dismiss Parmalat, which he referred to as "new Parmalat" from a shareholder complaint that is seeking class-action status. He said the re-incarnated Parmalat had assumed "all debts" belonging to its predecessor. The judge added that under Italian law, the new Parmalat inherited the liabilities of the previous entity, Parmalat Finanziaria. Officials of the reorganized dairy firm had argued that any fraud had been committed by the previous company and they did not assume liability for the pre-insolvency behavior of the company.

Blackstone buys Hilton for $26bn 

US private equity group Blackstone is buying the Hilton Hotels chain for $26bn in an all-cash deal.

Failure by US, EU, Brazil, India to converge could doom trade round

The global talks known as the Doha round aim to add billions of dollars to the world economy and lift millions of people out of poverty through new trade flows. But they have struggled since their inception in Qatar's capital six years ago, largely because of wrangling between rich and poor countries over eliminating barriers to farm trade and, more recently, industrial trade.The U.S. and EU last month criticized India and Brazil for refusing to offer new market opportunities for manufacturing exports. The two emerging powers, in turn, blamed the impasse on U.S. reluctance to make cuts in the billions of dollars it pays annually in farm subsidies. WTO Director-General Pascal Lamy said the failure by the four to find common ground "was not good news." Trade officials say major subsidy tariff concessions are unlikely in 2008, when U.S. elections will be held, and 2009, when Indian elections are scheduled, meaning a breakthrough must be made before August to give the WTO enough time to complete the technical work on a final treaty by the end of the year.

A Slowing US Housing Market May Signal Lower Remittances to Latin America

Among the many implications of the declining housing market in the US are that Latin American immigrants will likely lose jobs, thus decreasing their remittances. As Latin American economies have come to depend on these remittances, a US housing bust could disrupt growth south of the border.

New Developments for Registration of Tainted Capital in Brazil

Foreign investors that have made equity investments in Brazil but failed to register the investment can now register without a penalty. Fines will be imposed, however, for those that fail to make proper registrations through the new system. Registration of tainted capital will have certain tax implications for investors as well.

  • Daily Press Review

SA violent crime 'unacceptable'
BBC News, Centrist newscaster, London, England

Congo Court Clears Foreign Miners of War Crimes
CongoPlanet.com, Independent online news aggregator

Leaders reject  pan-African dream
GhanaWeb, Online news portal, Amsterdam, Netherlands

Senegal Failing to Act on Trial of Hissène Habré
Human Rights Watch (Africa), International news press releases

MCC obstructing HIV research - court
iafrica, Online news portal, Cape Town, South Africa

Facts tell different story to police's claims
Independent Online, News portal, Cape Town, South Africa

Pretoria News hostage accused denied bail
Mail & Guardian Online, Liberal, Johannesburg, South Africa

Nqakula: We have a problem...
News24.com, Online news portal, Cape Town, South Africa

Rahul Gandhi meets Cuban foreign minister
Brazil Sun, Independent online news aggregator

Jacklisted Soca Warriors officially serve TTFF
Caribbean News Portal, Online news aggregator

Brazil: Investigate Deaths in Rio Police Operation
Human Rights Watch (Americas), International news press releases

Free AIDS Testing, But Then What?
IPS Latin America, International cooperative of journalists, Rome, Italy

Whose money? - Funds from incoming phone calls at centre of brewing controversy
Jamaica Gleaner, Independent daily, Kingston, Jamaica

Peru: Amnesty International, Control Arms Campaign in Lima, Peru
Living in Peru, News portal, Lima, Peru

Exemptions leave do-not-call registry without teeth
The Globe and Mail, Centrist daily, Toronto, Canada

Gaza militants release BBC reporter
Toronto Star, Liberal daily, Toronto, Canada

No need to link consultative meeting with interpellation
Antara News, News agency, Jakarta, Indonesia

Bangladesh election commission to finalize political reform proposals after consulting political parties
Bangladesh Journal, Independent news portal

Curfew imposed, govt rejects talks
India Express, News portal, Mumbai, India

AP to seek review of gas pricing
India Times, Conservative daily, New Delhi, India

Anwar's RM100m defamation suit against Dr Mahathir struck off
Malaysian Star, Online news portal,  Selangor Darul Ehsan, Malaysia

World in brief: What happened today
New Zealand Herald, Conservative daily, Auckland, New Zealand

Argentine president backs wife as candidate
People's Daily Online, English-language, Beijing, China

'It was like being buried alive'
Sydney Morning Herald, Centrist daily, Sydney, Australia

Foreign doctors behind U.K. plot?
The Hindu, Left-leaning daily, Chennai, India

BBC's Gaza reporter released
BBC News, Centrist newscaster, London, England

Two million cigarettes seized
BreakingNews.ie, Online news portal, Cork, Ireland

MI5 knew four of the bomb plotters
Daily Mail, Conservative daily, London, England

BT selects emuse absolutely for interactive ad services
DMeurope, Online news portal, Amsterdam, Netherlands

Liverpool doctors at centre of bomb plot probe
icLiverpool, Online news portal, Liverpool, England

Effort to build a large mosque rattles some in Cologne
International Herald Tribune, Independent daily, Paris, France

Games chaos goes on in rhodes
Isle of Wight County Press, Independent daily, Isle of Wight, England

Life term for brutal killer
Manchester Online, Independent daily, Manchester, England

Bomb police probe Dumfries link
News & Star, Independent daily, Carlisle, England

Your pictures could make town a better place to live
North-West Evening Mail, Independent daily, Cumbria, England

Ground squirrels could hinder building of Olympic Village in Prague
Radio Prague, Online news portal, Prague, Czech Republic

Journalist Alan Johnston Freed In Gaza
Sky News, Independent newscaster, Middlesex, England

The Physicians Plot:  British Police Hunt the Terror Doctors
Spiegel International, Liberal newsmagazine, Hamburg, Germany

BBC reporter Alan Johnston released
The Guardian, Liberal daily, London, England

BBC journalist freed after four months
The Irish Times, Centrist daily, Dublin, Ireland

Australia police arrest doctor in UK bomb-plot inquiry
The Scotsman, Moderate daily, Edinburgh, Scotland

PM: Fly flag on every building
The Sun, Conservative tabloid, London, England

Alan Johnston  : BBC reporter freed in Gaza
The Telegraph, Conservative daily, London, England

Girl could give birth to her sister
Times Online, Conservative daily, London, England

Johnston: 'It Was Like Being Buried Alive'
Arutz Sheva, Online, right-wing, Tel Aviv, Israel

UK Bomb Plot: Detained Doctor's Brother Denies Involvement
Asharq Al-Awsat, Pan-Arab daily, London, England

Australia ramps up security after arrest
Gulf News, Independent daily, Dubai, United Arab Emirates

Kidnapped BBC reporter Alan Johnston released
Haaretz, Liberal daily, Tel Aviv, Israel

RIGHTS:  Torture Routine in Kurdish Jails, Report Charges
IPS Middle East, International cooperative of journalists, Rome, Italy

Housing Bank extends JD11m to finance new buses for Integrated Transport Company  - Jordan
Middle East North African Network, Online financial portal, Amman, Jordan

Pakistani Troops Besiege Militants Inside Radical Mosque
Nahamet, Online news portal, Beirut, Lebanon

Israelis resume security talks with Abbas
The Daily Star, Independent daily, Beirut, Lebanon

Influential people seek to block the peace agreement - Saada still tense (Front)
Yemen Times, Independent weekly, Sana'a, Yemen

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Copyright 2007 - Migalhas International

The messages that appear in this newsletter are for informational purposes only. They are not intended to be and should not be considered legal advice nor substitute for obtaining legal advice from competent, independent, legal counsel in the relevant jurisdiction.

Transmission of this information is not intended to create, and receipt does not constitute, an attorney-client relationship. The information contained on this list may or may not reflect the most current legal development.