Sharp 2007 Annual Report Download - page 35

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Sharp Annual Report 2007 33
product liability compensations. Nonetheless, there still
exists the possibility of a large-scale product recall or
litigation caused by unforeseen events, which may adversely
affect brand image or influence the business results and
financial position of Sharp.
(8) Laws and Regulations
The business activities of Sharp are subject to various
regulations in countries where it operates, including
business and investment approval, export regulations, tariffs,
accounting standards and taxation. Sharp must also adhere
to various laws and regulations concerning trading, antitrust
practices, product liability, consumer protection, intellectual
property rights, product safety, the environment and
recycling. Changes in such laws and regulations may affect
the business results and financial position of Sharp. Further,
a system of accident reporting and disclosure has been
instituted pursuant to the revised Consumer Product Safety
Law and related regulations in Japan. In case a major
accident occurs related to one of Sharp’s products,
disclosure of said incident could diminish its brand image.
(9) Litigation and other legal proceedings
Sharp deploys business activities around the world, and as
such, is subject to risk associated with litigation and other
legal proceedings. Differences in legal and judicial system
according to region make it difficult to predict the result of
litigation or other legal proceedings currently involving Sharp
or of these which may arise in the future. An adverse result
due to litigation and measures taken by the regulatory
authorities could affect the business results and financial
position of Sharp.
(10) Leak of personal data and other information
Sharp retains personal data and other confidential
information concerning its customers, business partners and
employees. Extreme care is taken to protect this information.
A company-wide management system promotes employee
education and other measures aimed at ensuring compliance
with management regulations. If information is leaked,
however, it may reduce confidence in Sharp or result in
substantial costs (associated with leakage prevention
measures or indemnification for damages, for instance),
which may affect the business results and financial position
of Sharp.
(11) Other key variable factors
In addition to the aforementioned risks, the business results
of Sharp may be significantly affected by accidents and
natural calamities, or major fluctuations in the stock and
bond markets.