Vistra content is developed by experts to increase your professional knowledge and lower your global operating risks.

The global tax landscape is evolving to account for electronic commerce and other technologies and to target perceived aggressive tax avoidance by multinationals. Laws determining what constitutes a taxable presence — or a permanent establishment — are changing particularly quickly. Failure to understand and follow permanent establishment laws in all your countries of operation can lead to double taxation, financial penalties, reputational damage and more.

Deploying and maintaining talent around the world is a critical priority for companies in today’s global economy. But the stakes are high. Employing an expat typically costs two or even three times more than the simple cost of the individual’s home-country salary.

M&A activity has reached record levels in recent years, with buyers spending trillions of dollars annually. Despite the frenzy, however, serious risks remain, especially when participating in an international transaction. Some experts put the failure rate of mergers and acquisitions between 70 and 90 percent, so due diligence remains essential.

Protecting the personal data of customers and employees has never been harder and the stakes have never been higher. Governments the world over are tightening restrictions and increasing fines for noncompliance. Related media stories involving companies such as Google and Facebook help ensure the public is aware of its data privacy rights. Understanding and fulfilling your own obligations in this climate is difficult, but it’s also essential, especially given strict and far-reaching legislation such as the EU’s GDPR.

One of the biggest mistakes a company can make when planning for international expansion is applying a cookie-cutter approach to budgeting and not adequately accounting for the tax laws, employer obligations, cultural nuances and other quirks of their target countries. All of these factors and more vary widely by country and can significantly affect your bottom line. Even if you’ve already established a presence abroad, you can’t assume that your experiences there will prepare you for setting up shop in another market. Each new target country presents a unique set of challenges and related costs and timelines.

Expanding into a new country and grappling with the nuances of local labor laws, payroll obligations and cultural expectations can be daunting, even for an experienced HR professional. All your hard-earned knowledge about employing workers in your home country must be reevaluated when setting up shop in a new market.

Every international expansion is unique. Each organization has its own goals and risk tolerances, and each country has its own tax, employment, immigration and other laws. Despite differences, however, there are certain basic concepts that any organization considering international expansion should understand.