Business Basics – Five Main Articles in Commercial Law
A business is defined as a legally registered company or association that engages in commercial, industrial, or financial activities for profit. Companies may be for-profit establishments or non-profitable ones that conduct non-commercial activities to meet a social cause or further an educational charity. It is the task of the company director or officers to ensure that the company complies with the laws of the country in which it operates. While the directors and officers of a company are elected or appointable, the officers must have complied with the basic company rules and regulations.
Although many countries have corporate laws that give the freedom to own, manage, and operate businesses, they do not provide protection against debts, fraud, and lawsuits. Some countries have passed so-called anti-trust acts that limit or ban corporate monopolies. Owners may be held liable for injurious conduct if their companies monopolize or attempt to monopolize an existing market. This means that one business owner could control or manipulate prices and products that cannot be found by another business. Monopoly and anti-trust laws often restrict ownership of real estate by corporations and restrict the rights of workers to get higher wages and benefit from increased investment opportunities.
Income, profits, and losses are the terms that most lawyers use when talking about business entity law. Profits refer to the value of all the elements of a business venture including the cost of the goods produced or services rendered to the consumers and the value of the assets owned by the business entity. The concept of profit is relatively simple since it simply means the amount of money that the entity makes after the expenses are deducted. This is usually expressed as the total of all profits over and above the expenses incurred during the course of the commercial activity.
Another term commonly used in legal transactions is the term revenue. This term is derived from the word be, which means income. The revenue in this case refers to the amount of money that comes in from various activities during the course of the business’s operation.
Another main article in commercial law is the general partnership. A general partnership exists when a person owns shares in a partnership and there is no limit on the number of partners. Partnerships can exist among individuals, businesses, trusts, corporations, etc. Business entities can own stocks in another business entity or they can own shares in another person’s company.
The third main article in legal transactions is share capital. Share capital refers to the funds that an entity makes use of in order to purchase or dispose of assets or in order to raise capital for investing activities. The capital thus acquired is called share capital. The two types of transactions that make up share capital are dividends and capital gains. Dividends, also known as salary, pertains to a percentage of the shareholders profits that is received by the corporation.
The fourth main article in commercial law, intellectual property, involves the creation and ownership of businesses and their intangible properties. This includes copyrights, trademarks, patents, and trade secrets. Intellectual property in this case can be produced in various forms such as books, inventions, or the like. In order for businesses to protect their intangible property, they can form corporations. Business entities can also obtain protection by securing copyrights.
The fifth main article in legal transactions is contract law. Contracts often govern the way a business operates and the way that they will operate in the future. These include commodity contracts, hire-and-fire contracts, loans, property contracts, and licenses. The five elements in this article are profit, sale, exchange, creation, and ownership. All these elements can be seen in all types of businesses and all businesses require these five elements in order to survive.