Business law is a branch of private law governing all the standards relating to the creation, operation, and dissolution of companies as well as their various businesses. The particularity of business law is that it encompasses and implements many legal matters at the same time, namely contract law, company law, commercial law, tax law, consumer law, criminal law, commercial procedure law, social law, commercial lease law, insurance law, financial law, stock market law, IT law, accounting law. In another way, this great discipline regulates the activities of traders and industrial companies. For this reason, it affects the mode of establishment of commercial acts in the context of relations between individuals, professionals, or non-traders.
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What is the field of business law?
Business law, as a legal discipline, has as its main subjects private law legal persons and, in some cases, mixed law persons. In general, this major subject in the private law branch concerns the life of entrepreneurs, traders as well as their employees and clients. Thus, any procedure carried out by a company falls under business law. Consequently, this legislative area affects several situations cited in the following list:
- The constitution of companies;
- The realization and the development of the activities of the companies;
- The creation of links and the negotiation of companies with their collaborators and their customers;
- The functioning of the mechanism of the legal activities of companies;
- The drafting, conclusion of legal acts, and their application.
- To better determine the areas of intervention of business law, here is the interpretative list of the three major sectors affected by this discipline:
- The commercial structure of companies: the commercial structure generally concerns the statute of the company, the choice of the legal form of the company, the internal regulations of the company… It is the rule which makes it possible to organize, coordinate and control the activities of a company.
- Commercial activity: the business relations of a company with another or with its employees and customers are always based on a contract. In this context, several types of legal acts come into play, namely sales contracts, employment contracts, partnership contracts, distribution contracts, franchise contracts, commercial lease contracts, commercial contracts. cross-border, mixed contracts. On the operational side, there are for example financial transactions such as loans, leasing.
- Sanctions: based on the same basis as to all other branches of private law, business law is also characterized by the occurrence of numerous offenses. The latter are regulated by a specific regime that is criminal business law. For example, there is theft, extortion, unfair competition, counterfeiting, bankruptcy, embezzlement… Some of these offenses can be brought before the criminal court. However, in the majority of cases, disputes relating to business law are judged by the commercial court. This qualification is entirely left to the sovereign appreciation of the judge.
Concerning these different categories of areas of business law, the applicable principles remain freedom of enterprise and free competition. Thus, this fascinating discipline highlights the application of commercial law and company law.
What are the branches of business law?
The ramification of business law includes the five main branches set out in the list below:
This is, without a doubt, the basis of business law, as it governs the activities of companies from their creation until their dissolution. By definition, company law is the matter which provides the legal personality of a company while organizing its assets. In other words, its main purpose is to regulate the creation and establishment of legal persons under private law. These can either be companies, non-profit associations, foundations, or others.
This legislative area lists both the rules relating to the principle and the fundamental right of companies. This matter also has multiple family ties with commercial law. In competition law, the act of unfair competition, market disruption, and/or denigration are punished. Thus, any company is required to carry out its activities in compliance with its competitors and with commercial regulations.
A pillar of a country’s economic system, banking law generally concerns the sector of financial institutions and their activities (property management, loans, current accounts, bank transfers, etc.). In addition, any business relating to one of the subjects of banking law (banking, microfinance, etc.) is automatically subject to this law. Moreover, this matter is significantly affected by business criminal law. Indeed, there are many offenses relating to means of payment and credit in the banking sector. These are those mentioned on the list below:
- Issuing a bad check;
- Falsification and counterfeiting of checks;
- The production of counterfeit money;
- Extortion of funds;
- Money laundering.
By definition, distribution law is the regime applicable to operations for the distribution of goods on the national or international market. The concept of distribution refers to all the procedures aimed at providing products or services to consumers.
Intellectual creations are convertible into cash and have an indisputable value. Thus, intellectual property law aims to protect and provide a certain value by resolving the legal issues relating to these creations. Intellectual property includes copyright and industrial property. Within the framework of companies, industrial property is the most applied.
Commercial law is directly linked to business law. This matter generally governs the activities of traders.
In addition to these many disciplines, business law also includes labor law, consumer law, tax law, insolvency law, private international law, and even European law. Indeed, a company cannot function in the absence of legal relations with employees, other companies, and even the administration at the national and/or international level.
What are the sources of business law?
Business law is created by several sources such as those listed below:
The imposed sources:
These are those specified in the list below:
The law: business law was born following the laws on commercial companies and those on credit institutions. The shortcomings and the expansion of the business world as a result of these laws led to the creation of other laws.
Case law: it interprets laws and regulations. At the risk of being sanctioned following a denial of justice, magistrates prefer to interpret the laws, guess the intentions of the parties to the contract… to find a solution to the problems they are dealing with. The decisions rendered thus become models for resolving future cases.
A priori, international treaties are the primary international sources of all rights. According to the Kelsen pyramid, these treaties are superior to domestic laws upon ratification. In business law, the rise of multilateral and bilateral treaties began in the 1980s.
Subsequently, they are supported by uses. Thus, the application of laws is no longer uniform at the international level. Therefore, traders apply the rules that they find fair and easier to implement. The Lex Mercatoria was then born from contracts concluded between traders outside their national territory.
How important is business law?
A branch of private law, business law is a “must” for all entrepreneurs not only for the adaptation of their company to legal principles but also for their protection against third parties. Thus, company law serves as a basis for choosing the type of company and the statutes. Competition law and contract law, on the other hand, protect the interests of the parties in the event of a dispute.
In relation to the administration of a company, business law occupies an important place. The mastery of this right is beneficial for the latter. Indeed, a leader who knows the rules in commercial matters is more apt to forge links and to make his business prosper more quickly. Even in the context of international relations, he can set up reliable investment strategies. Moreover, training in business law for all teams within a company is advantageous to such a company.