BTEC HND Business Law Unit 7: Impact of Law on Business Analysis

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Added on 2021/04/05

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This report, prepared for a BTEC HND in Business, analyzes the impact of business law on companies, specifically focusing on contract, employment, and company law. It uses real-world examples, including cases involving Toyota Motor Vietnam and BIDV, to illustrate the potential legal issues and their consequences. The report examines a contract law issue where a Toyota car had a defective break, an employment law issue where employees of LLC MTV Vast Apparel Vietnam were forced to work overtime, and a company law issue involving a bribe received by a BIDV executive. It explores the legal troubles arising from these issues, such as contract violations, labor law violations, and potential corruption, and their impact on the businesses involved, including reputational damage, financial implications, and internal stakeholder relations. The report covers the form and validity of contracts, employer responsibilities, and the legal formation of business organizations, offering insights into how these legal aspects affect business operations.

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ASSIGNMENT 2 FRONT SHEET
Qualification BTEC Level 4 HND Diploma in Business
Unit number and title Unit 7: Business Law
Submission date Date Received 1st submission
Re-submission Date Date Received 2nd submission
Group number:
Student names & codes Final scores Signatures
1. Phạm Ngọc Tùng- GCH16255
2. Hoàng Minh Nhật- GBH16019
3. Bùi Hoàng Long- GBH16373
4.
Class GBH0701 Assessor name Đoàn Thị Thùy Trang
Student declaration
I certify that the assignment submission is entirely my own work and I fully understand the consequences of plagiarism. I understand that making a false declaration is
a form of malpractice.

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P3 P4 P5 P6 M2 M3 M4 D2 D3

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OBSERVATION RECORD
Student 1
Description of activity undertaken
Assessment & grading criteria
How the activity meets the requirements of the criteria
Student
signature: Date:
Assessor
signature: Date:
Assessor
name:

4
Student 2
Description of activity undertaken
Assessment & grading criteria
How the activity meets the requirements of the criteria
Student
signature: Date:
Assessor
signature: Date:
Assessor
name:

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Student 3
Description of activity undertaken
Assessment & grading criteria
How the activity meets the requirements of the criteria
Student
signature: Date:
Assessor
signature: Date:
Assessor
name:

6
Student 4
Description of activity undertaken
Assessment & grading criteria
How the activity meets the requirements of the criteria
Student
signature: Date:
Assessor
signature: Date:
Assessor
name:

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 Summative Feedback:  Resubmission Feedback:
Grade: Assessor Signature: Date:
Internal Verifier’s Comments:
Signature & Date:

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Contents
LO2. Illustrate the potential impact of the law on a business .......................................................................................9
P3. Using specific examples illustrate how company, employment and contract law has a potential impact upon
business. .....................................................................................................................................................................9
I.Issue of Contract law ............................................................................................................................................9
II.Issue of labour law ........................................................................................................................................... 11
III.Issue of company law ...................................................................................................................................... 11
LO3. Examine the formation of different types of business organisations ................................................................. 12
P4 Explore how different types of business organisations are legally formed ....................................................... 12
P5 Explain how business organisations are managed and funded ......................................................................... 13
LO4. Recommend appropriate legal solutions to resolve areas of dispute ................................................................ 14
P6. Recommend legal solutions for resolving a range of disputes using examples to demonstrate how a party
might obtain legal advice and support .................................................................................................................... 14
I.Contract law ...................................................................................................................................................... 14
II.Labour law ........................................................................................................................................................ 15
III.Company law ................................................................................................................................................... 15
Conclusion ............................................................................................................................................................... 16
References ................................................................................................................................................................... 17

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LO2. Illustrate the potential impact of the law on a business
P3. Using specific examples illustrate how company, employment and contract law has a potential impact
upon business.
I.Issue of Contract law
About Toyota Motor Vietnam Company, TMVC is an automobile Joint Ventures founded in September, 1995. The
total investment capital was 89.6 million USD based on the capital contributions from Toyota Motor Corporation
(70%), Vietnam Engine and Agricultural Machinery Corporation - VEAM (20%) and KUO Singapore Pte.Ltd (10%).
Being one of the first automobile Joint Ventures in Vietnam, Toyota Motor Vietnam Co., Ltd (TMV) never stops
making efforts to be "Moving Forward" together with Vietnam. TMV has been incessantly providing high quality
products and perfect customer services to bring the highest satisfaction to our customers as well as positively
contributing to the development of the Vietnamese automobile industry.
The main article which relates to the issues in the contract for the explanation:
When buying a product of Toyota Motor Vietnam Company, they will give a contract about responsibilities between
their company and their customers. In selling-buying contract of Toyota Motor Company, party A is buyer – who
want to buy car of Toyota and party B is seller – Toyota Motor Vietnam Company. The model of this contract includes
terms:
ARTICLE 5: RESPONSIBILITIES OF PARTIES
1. Party B is obliged to deliver the vehicle on time, place, quality and type as stipulated in this contract, except in
force majeure.
2. Party B is obliged to supply sufficient valid invoices, vouchers and documents to Party A and be legally responsible
for the validity of the invoices, documents and documents handed over, including: Invoice of Party B, TMC invoice,
factory certificate, machine frame number and warranty book.
3. 10 days after the official delivery time of Article 3 of this contract, if Party B has not fulfilled its obligation to deliver
the vehicle without a plausible reason, Party A has the right to unilaterally terminate the contract and receive Again
the deposit.
4. Party A is not allowed to change the name specified in this contract and only transfer the vehicle to a third party
after the vehicle has been registered under the name of Party A.
5. Party A is responsible for paying and receiving the car at the stipulated time.
6. 10 days after the official delivery time of Article 3 of this contract, if Party A has not yet fulfilled the obligation to
receive the vehicle without a plausible reason, Party B may unilaterally terminate the contract and Clause The
deposit will belong to Party B.
7. Party A shall bear all costs related to registration, circulation and insurance procedures.
8. In case Party A pays for the loan through bank, Party A is responsible for purchasing the vehicle insurance policy
before Party B hands over the vehicle and documents to Party A to register the vehicle purchased under this contract.
9. Party A signs this contract with the word consumer. Therefore, Party A is committed to buying and using vehicles
for consumption purposes, not buying vehicles for brokerage and resale before registering vehicles for profit.

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10. Party A understands that Party B should have information to protect the interests of consumers, including Party
A. Therefore, Party A hereby agrees that during and after the execution of the contract. Party B is to collect, store,
use and transfer some information of Party A ("information") to third parties (TMVC and / or TMVC appointed
companies) to carry out the survey. Provide information, including the name, address, telephone number, ID card
number, representative, tax identification number (if any), sample Vehicle, ... of Party A. Party B undertakes to
collect, use and transfer information safely, accurately, fully and for the purposes stated above and at the same time
create conditions for Party A to change information and provided when needed.
The legal trouble which may be arise out from the contract
When receiving the car from the Dealer, Party A has tested the function of the car by driving around nearby. During
the test, the break of the Camry did not work properly, which lead to a major accident. Luckily, there is no casualty.
In this case, Party B violates the contract because they did not ensure the quality of cars as they committed. The
Camry had problem with the break and made Party A cannot handle the situation properly. Furthermore, it caused
unfortunately traffic accident. The legal issue here is that Toyota has committed to sign a contract for the quality of
the car but in fact the car bugs and causes accidents.
This legal issue will affect the business of Toyota. First of all, the issue will create the awareness in their customers.
Customers tend to be afraid and beware when they consider to buy Toyota’s product or other brands without any
issue. Next, the issue will decrease the value of Toyota stock. This will dramatically affect to the business and
reputation of its stock on the market.
Form of contract and validity of the contract
Form: This contract was established by text.
Consideration: The benefits of both the seller and the buyer are balanced. Party A has the right to know all
information clearly the origin of the product they want to buy. Moreover, the buyer after the deposit will have the
right to sue the seller if the seller does not deliver the car on time or not in accordance with the agreement. Party B
has the right to punish Party A if Party A late payment to Party B. The seller also has the right to sue the buyer and
enjoy the entire deposit as well as fine if the buyer cancel the contract.
Genuine consent: This contract is based on voluntariness of the two parties, Party A wants to buy the product to
Party B and Party B wants to sell Party A. In the contract, the terms are clearly stated, so the party A and B signed
the contract after careful investigation.
Capacity: Party A is a buyer, who is over 18 years old, has the right citizen and is responsible. For Party B – Toyota
Motor Vietnam Company, on March 26, 2007, Toyota Motor Vietnam Company was granted a business registration
certificate and was signed by Maruta Yoshihisa with tax code – 250015335, so they have the legal right to do
business.
Legality: The main subject in the purchase contract of Party A and Party B is the car, named Camry line of Toyota.
Prius cars have been censored and approved in Japan and when it comes to Vietnam, cars have been passed
through censorship and sold, so the items in the contract are legal.

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II.Issue of labour law
About LLC MTV Vast Apparel Vietnam, the company is 100% foreign capital. Specializes in garment products for
export to Europe, America and Japan. The company started operation in 1st december, 2014 and placed Tam Dan
industrial clusters, Tam Dan commune, Phu Ninh district, Quang Nam. the current director of the company is LIAO
TIEN FU.
A scandal of employment law: employees struck because the company violated
labour law and company could not provide basic needs of employees.
In 2nd June 2018, over 500 employees of LLC MTV Vast Apparel Vietnam stopped working and struck in front of the
company. Many employees claimed that the company forced them to work overtime for the whole week. The
Vietnam’s labour law says that each employee has maximum 32 hours per month to work overtime but in MTV Vast
Apparel company many employees had to work 72 hours per month. Besides, employees of the company claimed
about un-qualified meal. Mr. Huy Tu Le, director of Vietnam labour union said that 500 employees stopped working
is the result of forced employees so hard and paid them to poorly for each product they made. (Van, 2018)
The legal troubles of LLC MTV Vast Apparel Vietnam are violations of duties of employer when forced employees to
work overtime more than the time allowed in the labour law and they are also violations about Health and safety at
work place when provided meal lack of nutrition for employees.
The troubles could impact to the business operation. In this case, it impacted to relation between internal
stakeholder, in this case over 500 employees stopped working, this is a really serious problem can impact to the
productive of the company when lose amount of employees for over a week. The company could also get in other
trouble like reputation or brand name would be boycotted after the scandal then the revenue monthly would go
down. Any of these problem can get the company in the really
III.Issue of company law
About BIDV, the Bank for Investment and Development of Vietnam (BIDV) is one of the five largest State-owned
commercial banks in Vietnam. BIDV was established on 26 April 1957 under Decision No. 177/TTg dated 26th April,
1957 by the Prime Minister as the Bank for Construction of Vietnam and it adopted its present name on 14
November 1990. BIDV functions as a universal commercial bank providing a full range of currency, credit, banking
and non-banking services, and acting as authorized agency funding projects with sources from domestic and
international financial institutions. With its experience investing in key projects, BIDV plays the leading role in
development investment and project financing in Vietnam.
Scandal of BIDV:
Mr. Doan Tien Dung - Deputy General Director of BIDV received a bribe of 5 billion dong. Being asked to prosecute
on charges of accepting bribes with Mr. Doan Tien Dung, there were also Ms. Tran Thi Thanh Binh - Deputy
Director of BIDV Hai Phong. Ms. Binh was accused of helping Mr. Dung to receive VND 4 billion. This is a corruption
case with the crime of receiving the largest bribe ever discovered by Hanoi Police. Internal agencies also identified
this as a key case.
The victim in this bribery case is Mr. Hoang Van Khanh, General Director of Hai Phong Textile and Garment Export
Joint Stock Company (address km16, Road 353 Hop Duc commune, Kien Thuy district, Hai Phong). Due to the needs
of production and business of enterprises, from 2006 to 2008, 2 companies led by Mr. Khanh, including Hai Phong

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Textile and Garment Joint Stock Company and VK Hai Phong Limited Company, borrowed capital at BIDV Hai Phong
Bank branch 2 credit contracts with the amount of over VND 45 billion with a term of 78 months.
In the process of production and business difficulties, Mr. Khanh decided to sell collateral as container port yard in
Dam Mam area, Ha Doan 2, Dong Hai ward, Hai An district, Hai Phong for Alpha Oil and Gas Joint Stock Company.
Hai Phong with a price of VND 57 billion. After completing the transfer contract, Hai Phong Petroleum Joint Stock
Company transferred VND 57 billion into the account of Hai Phong Limited Liability Company at BIDV Hai Phong
Bank branch.
To serve the company's business, Mr. Khanh proposed to withdraw cash and transfer money but BIDV Hai Phong
Bank did not agree. Mr. Doan Tien Dung demanded that Mr. Khanh give 5 to 7 billion VND to settle. Because of the
production and business activities of the enterprise, Mr. Khanh had to accept the above request and had 3 times
transferred to Mr. Dung and his colleagues over 6 billion VND but Mr. Dung continued to ask for another 1 billion
VND. Only agree to settle for BIDV Hai Phong Bank.
In the afternoon of February 1, 2010, Mr. Dung made an appointment to meet Mr. Khanh at BIDV Vietnam
headquarters but due to traffic jams, Mr. Khanh could not come. On February 2, when Mr. Dung made an
appointment to meet Mr. Khanh at the Pho Vuong restaurant (Giang Vo street, Cat Linh ward, Dong Da district)
and received 1 billion dong of bribes, he was arrested by PC15.
On February 4, Hanoi Police Police Investigation Agency executed arrest warrants and emergency searches for Ms.
Tran Thi Thanh Binh, Deputy Director of BIDV Hai Phong Bank, one of the those who were discussed and carried
out Mr. Dung's direction in receiving bribes from Mr. Hoang Van Khanh.
Legal trouble
In this case, the director of BIDV had violated duty not to accept benefits from third parties.
Effect of legal trouble on business
This case affects BIDV's business reputation. Mr. Doan Tien Dung is one of BIDV's senior vice presidents but has
taken advantage of his position to benefit his partners. This is a personal case, so it does not affect BIDV's assets
but affects the reputation of the bank, especially the prestige for the big partners.
LO3. Examine the formation of different types of business organisations
P4 Explore how different types of business organisations are legally formed
Sole
Proprietorshi
p
Partnerships Limited
Liability
Company
(LLC)
Corporation Registered
Company
Number of
owners/found
ers
Only one
owner/found
er
More than
two people
From 2 to 50
people
(Following
vietnamese
law)
Created by
law
Unlimited
number of
owner
Liabilities of
members
Unlimited
liability
Unlimited
liability
Limited
liability
Limited
liability