Ethics question(Book1 p.23 Exhibit1) understand, conducted, question, business

AnalystForum

Hi,all

Book1 p.23 Exhibit1

I use CFAI text for the first time in L3...

In the first column of Exhibit1("applicable law"),

(first row)
Member resides in LS country, does business in NS country;
LS law applies, but it states that law of locality where business is conducted governs.

* LS: country with less strict securities laws and regulations than the Code and Standards
* NS: country with no securities laws and regulations

I can't understand this explanation..
If the local law governs, there is no applicable law isn't it?

Please correct my understanding..

Thanks in advance.