TJ Maxx 2014 Annual Report Download - page 32

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merchandise, or customer concerns about such issues, regardless of our fault, could cause damage to our
reputation and could result in lost sales, uninsured product liability claims or losses, merchandise recalls and
increased costs, and regulatory, civil or criminal fines or penalties, any of which could have a material adverse
effect on our financial results.
Our expanding international operations may expose us to risks inherent in operating in new countries.
We have a significant retail presence in Canada and in countries in Europe and have established buying
offices around the world, and our goal is to continue to expand our operations into international markets in the
future (such as continued expansion in Europe). It can be costly and complex to establish, develop and maintain
international operations and promote business in new international jurisdictions, which may differ significantly
from the U.S. and other countries in which we currently operate. In addition to facing risks similar to our U.S. and
current international operations, such as with regulations such as the U.S. Foreign Corrupt Practices Act and the
U.K. Bribery Act, there are additional risks inherent in opening operations in new countries, such as
understanding the retail climate and trends, local customs and competitive conditions; complying with relevant
laws, rules and regulations; and developing the appropriate infrastructure for local operations. There are also
financial risks associated with international operations, including currency exchange fluctuations and adverse tax
consequences or limitations on the repatriation and investment of funds outside of the country where earned,
which could have an adverse impact on our operations, profitability or liquidity. Complying with applicable laws
and our own internal policies may require us to spend additional time and resources to implement new
procedures and financial controls, conduct audits, train Associates and third parties on our compliance methods
or take other actions, which could adversely impact our operations.
We are subject to risks associated with importing merchandise from other countries.
Many of the products sold in our stores are sourced by our vendors and, to a lesser extent, by us, in many
countries outside of the country where the stores are located, particularly southeastern Asia. Where we are the
importer of record, we may be subject to regulatory or other requirements similar to those imposed upon the
manufacturer of such products. We are subject to the various risks of importing merchandise from other
countries and purchasing product made in other countries, such as:
— potential disruptions in manufacturing, logistics and supply;
— changes in duties, tariffs, trade restrictions, quotas and voluntary export restrictions on imported
merchandise;
— transport capacity and costs;
— information technology challenges;
— problems in third-party distribution and warehousing and other interruptions of the supply chain;
— strikes, threats of strikes and other events affecting delivery;
— consumer perceptions of the safety of imported merchandise;
— product and international trade compliance with laws and regulations of the destination country;
— product liability claims from customers or penalties from government agencies relating to products that
are recalled, defective or otherwise noncompliant or alleged to be harmful;
— concerns about human rights, working conditions and other labor rights and conditions in countries where
merchandise is produced or about transparent sourcing and supply chains;
— compliance with laws and regulations including changing labor, environmental and other laws in those
countries and those concerning ethical business practices, such as the U.S. Foreign Corrupt Practices
Act and the U.K. Bribery Act;
— exposure for product warranty and intellectual property issues;
— currency exchange rates, financial or economic instability; and
— political or other issues in countries from or through which merchandise is imported.
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