Take Argentina, a case I know far too well. As INC magazine pointed out, the tax rate on businesses goes up to 108% of your profit. (< http://www.inc.com/magazine/201106/doing-business-in-argenti... >). How's that possible? Here's how: the government purposely passes endless contradictory laws thus ensuring you are always breaking the law, just to survive. (A business can't pay 108% of its money in taxes and still survive!). Therefore, you live in a state of somehow doing something illegal. The result? If the government doesn't like you, they find the illegal thing you're doing (that you have to do, just to survive, since the laws are contradictory and unreasonable, like that 108%), and then punish you for "breaking" the law.
Welcome to the jungle, we've got fun and games ;)
Conclusion: If you step into the third/developing world, the key isn't what the law actually says -- but _how sh*t gets done in practice_.