Exploring Business Law in the UK: Formation, Funding, and Management

This report provides an overview of business law in the UK, focusing on the legal requirements for company formation, including company name registration, documentation, and the roles of shareholders and stakeholders. It discusses the importance of the Memorandum of Association and Articles of Association in defining company operations. The report also examines various funding channels available to businesses in the UK, such as traditional methods, government grants, crowdfunding, peer-to-peer finance, and short-term loans, highlighting the challenges and opportunities associated with each. Furthermore, it briefly touches upon legal solutions like meditation, collaboration, and arbitration. The report concludes by emphasizing the importance of adhering to business law and exploring different funding and management strategies for success in the UK market. Desklib offers a wealth of similar resources for students.

BUSINESS LAW

INTRODUCTION
◦ Business law allow business to deal fairly and legally, a company have to follow all the commercial law
provided by the government.
◦ Every business deal in trade and customer which need to ensure that deal remains legal throughout the
process. There are certain laws to form a business in UK.
◦ In this report we will discuss how business is been started in the UK by looking at various types of
owners a sole trader can have. Later we will discuss how businesses are been managed and funded.
◦ At last, we will discuss various different legal solution for certain issues.

How a company is been formed in UK
◦ To start a business in UK, there are certain steps involved, these steps provide clear guide to an
individual or an entrepreneur to obtain all the legal documentation and the registration of company in the
books of law. These steps are:

Company name:
◦ Company name: the name of the company is the first ever step involve, the business owner need to show
the legal and patent company name to the government of UK to get trade and deal licence.

Company documentation:
◦ Company documentation: a company need to have all the legal and private documentation and have to
submit it to the government. At first the government examine the all documentation and then provide
licence of trade and business according to the Companies Act 2006.
◦ Constitutional documentation: according to the Republic Act No. 8293, the
company have to register their property under intellectual property law. And the
company have to show how many members will be operating the business and who
will be the owner.

Shareholders and stakeholders
◦ Shareholders and stakeholders; both, the shareholders and stakeholders plays a vital role in the formation
of the company. The company have to provide all the details of shareholders and stakeholders to the
government under Employment Law.

Ownerships and partnership
◦ Ownerships and partnership: after all the legal documentation and registration, the company is now free
to trade and deal in public.
◦ After this it totally upon the company to decide the type of ownerships and partnership they want to carry
for example if the owner of the company wants to deal sole in the market then they have full rights to do
so and if the company is looking for the partnership then they have to legally register their agreement to
the government,
◦ note; this is not compulsory by the government, owners themselves can create fair agreement but it is
suggested to have proper agreement with the third party to avoid any kind of conflict between the
partners.

The Memorandum of Association
◦ The Memorandum of Association: the MOA plays in important role in the companies working, the
Memorandum of Association means legal document which is been signed by all the shareholders of the
company to take participation in the company or to form separate legal entity.
◦ The newly established company need to submit their MOD which is signed by all the shareholder and
member of the business organization.

Article of association
◦ Article of association: the article of association means all the practical guidelines the rules of the
company which every shareholder need to follow. This AOA is been signed by the guarantors, directors
and secretary of the company. According to the Companies Act 2006, the company have to highlight the
role and duties of each and every member and their contribution and powers in the business organization.

how a business is managed and funded
◦ Business organization need funds to continue the flow of the process, every
business need funds to stay in the market and keep the development as the first
priority.
◦ In UK, business funding is been quite challenging especially for the newly started
business. Every business in UK know that they need the legal funds to operate.
◦ Many small scale business organization arrange funds from various channels and
sources and many limited company of the UK have various government and non
government source of funding.

Traditional channels
◦ Traditional channels: the traditional channels are often called 'good old days' by small scale businesses of
the UK.
◦ This is personal type of funding the business which include the better relationship with the loan provider.
◦ For example of the company is newly started and need funds then they can ask their friends and family
to provide financial help that is why it is been called traditional channels of funding the business.

Grants by the government
◦ Grants by the government: all the small scale business organization get grants from the government to
boost the growth but this grant only been provided to those business organization who proof certain
documentation to the government such as, according to the section 31 of Local Government Act 2003.
◦ it can be seen that after the impact of COVID-19 on the small scale businesses of UK, the government
have allowed relief and have increase the amount of grant from 2000 euro to 25000 euros.