For a drink to be bourbon, the law dictates it has to be no more than 160 proof. To make things a little more complex, it can not be more than 125 proof when it enters a barrel. A barrel can be made of any kind of oak, but currently every distiller in the industry uses American White Oak because it is porous enough to help the whiskey age well, but not so porous that it will allow barrels to leak. Barrels must be new and charred on the inside. By international agreement, bourbon must be made in the U.S.A., or it's simply not bourbon.
Similar protection exist for scotch, vodka and other spirits.
One reason for the rule is that it allows distillers in the native country to control quality. It sure doesn't hurt the export business. There's no law that says bourbon has to be made in Kentucky, though practically all of it is. Distillers say the same limestone spring water that fortifies the bones of yearling thoroughbreds gives Kentucky bourbon its perfect flavor. There's not a lot of difference between the two.