Business Law Report: UK Legal Framework and Business

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Business law
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Contents
Introduction......................................................................................................................................5
Task 1-(LO1 AND LO2).................................................................................................................6
Task 2-(LO3).................................................................................................................................14
Lo4.................................................................................................................................................18
Conclusion.....................................................................................................................................22
References......................................................................................................................................23
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INTRODUCTION
This assignment deals with the investigation of a legal system with the help of data and statistics
available from discrete sources. Business law is the segment of civil law that regulates all
commercial activities, trading standards and regulations and mentions punitive actions in case of
breach of any provision. The legal system in any country is managed by the legislature,
executive and judiciary. Law is the set of rules and regulation to ensure order in society. This
report deals with the nature of the legal system, sources and some laws as employment laws,
company act and contract law etc. and their importance in maintaining the effective functioning
of the rule of law.
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TASK 1-(LO1 AND LO2)
Nature of legal systems and legislation impacting businesses
Parliament is the principle law-making a body in the UK and across the world. Parliament is
considered as the sovereign in the UK, it means the parliament of the UK is above all and the
powers are unlimited. In case of conflict between the parliament and the judiciary, or between
the parliament and executives the power of the parliament will preside. It cannot be altered by
any other organ (Bant, 2015).
Sources of law
The constitution is the supreme law of the land. The laws in the UK derive authenticity from
various sources: common law, European Union law and legislation of the parliament. The
legislation of the parliament is also divided into two categories as primary legislation and
secondary legislation.
Legislations are the laws stipulated by the parliament of the UK. They are drafted according to
the pre-defined procedure in the parliament. They are also categorized as primary legislation and
secondary legislation.
Common law is the laws stipulated by the legislature of Scotland and Ireland. Their jurisdiction
is restricted to territories of these nations.
General customs: they are not codified but they existed since the time immemorial. Since, since
have a similar impact. They support the absence of codified law in the UK (Barnard, et al.,
2017).
Book of authority: judiciary of England refers to certain books frequently. For example, Coke
and Blackstone are frequently used books.
Parliamentary conventions are not the laws in clear sense but their breach can lead to punitive
punishments. The convention of the parliament regulates the relationship between the
parliament, head of the state and the parliament.
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Elucidate the role of government in the law-making procedure
The government is taking active participation in the process of making law. The entities involved
in the process of law-making are both the houses of the parliament, head of the state. A bill is a
piece of document that is transformed into an act of the parliament after the process defined in
the constitution. Bill is categorized as a private bill, public bill.
The law-making process starts with the introduction of a bill in the parliament by the public
member and private member. After the introduction, it undergoes with the first reading, second
reading and the committee reading. In all this reading the complete draft is discussed clause by
clause and changes are made in each stage. After reading of a bill by the committee the third
reading of a bill starts. It is sent to the second house of the parliament and follows the same
procedure. In the last part, a bill is sent to for the assent of the monarch and after this, it becomes
delegated legislation means it has the power to regulate particular duty or task (Barnard, et al.,
2017).
Statutory and common law is applied in the justice courts
Laws of the parliament are applied in the courts as in the federal courts, subordinate courts and
district courts. The law is applied with the case by case reading and according to the need of the
case. Laws are applied only after the aggrieved party move to the court. In the court complete
case is analyzed in detail. After the analysis of each provision, the validity of the case law is
assessed and based on the assessment judiciary gives its verdict.
Common law is the substantive law and procedural rule that has been created by the judges
through the pronouncements in the cases they have heard. The substantive rule is about conduct
whereas statutory law is the legislation of the parliament of the UK. Both types of law are
interpreted in the court of law and then enforced by the judiciary according to the needs of the
legal system. Effective enforcement of the laws is important to maintain the rule of law in the
nation and ensure smooth functioning of the legal system (Bacon et al., 2017).
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Effectiveness of the legal system
The effectiveness of the legal system can be measured with the effectiveness of verdicts it
delivers and its acceptance by society. Every legal system is reformed to improve the quality of
the verdict and remove the delay and deficiency in the system. From the year 2005-2020 many
reforms have been suggested in the legal system of the UK to improve its efficiency.
Constitution of Alternative dispute resolution mechanism is proposed to provide an alternative to
take legal advice at an affordable price. It is not constituted to bypass the legal mechanism.
Constitution of the consumer forum is also done to resolve the issues and difficulties faced by the
consumer and prevent them from the greed of business owners. Constitution of the UK is also
reformed to make effective changes in the public structure and improve their functioning and
effectiveness (Bench-Capon, 2015).
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Impact of different laws on business
Change in business is because there is a change in business laws; laws affect business as it
affects the relation of employer with their employees. Laws which are there for business are
Companies ACT, Employment ACT and Contract ACT. The businessman who is doing their
business it is important for them to understand the laws of business for the smooth functioning of
a business. Laws are made for business which employer and employee both had to follow.
Business laws taught ethics to do the business, it is mandatory for every business professional
and management student to get an understanding of business law. European Union regulates the
business of UK based business unit (Beatty et al 2018).
Companies ACT 2006: Companies ACT 2006 is the important law made by UK legislation for
with the thought of ‘think small first approach’ it helps a small businessman who has a small
business is set up and managing their business. This is the biggest law ever discussed in
parliament, covers 1300 sections. In the year October 2009 after long discussion this Act
becomes Law. This ACT ensures the rights of employees, consumer and shareholder should be
protected. This ACT ensures to reduce the administrative burden that the company carries (Relief
2016).
Contract LAW 1994: Contract law in the UK is made to control and regulate the supply of
goods which is a great help for seller and buyer. Whenever there is an activity of selling and
buying from a supplier it is done with the help of contract, an agreement is between two parties
for the exchange of services or goods and profit-sharing also. The contract between both the
parties protects the rights of each other. In case of breach of contract, it protects a party from
damage and is liable to get monetary compensation (Smits2017).
Employment law: Employment law is for the employees and employer. Ensure minimum wage
for the worker, fix working hour. Employees can work in a free environment it protects
employees from workplace harassment. It builds a relationship between employer business and
employees. Health and safety of employees, women's safety all these things are taken care of. By
the time when the UK left the European Union certain changes in employment laws take place
(Walsh 2015).
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Company Act, Contract law, Employment law are the Act which is made for the business to
operate in proper manner .laws of business get changed as a change in Taxation policy and its
result in a change in doing business. The motive of the government to impose business law is to
make sure that business that runs follow business ethics also ensure health and safety of
employees.
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Difference between legislation, regulation and standard
Legislation: The process by which laws are made and enacted is legislation. These laws are
made in parliament. Laws are there to give functions that all will follow, a law set standards,
suggest ways to solve disputes and protect standards. Laws are there to give solutions to the
problem, example: Human Rights Act, Consumer Rights Act is made to support employees
(Pascale et al 2000).
Regulation: Regulations are the rules made by the government; Regulations are many and
different for a different type of work. Regulations direct how business can operate. Regulation on
business is imposed to protect the rights of employees. Regulations have certain guidelines for
quality of products, the process of production, safety measures etc. It is necessary for all
organizations to follow the regulations (Pascale et al 2000).
Standard: Standard is a document made by higher authorities or government officials. That
document contains rules and guidelines to follow and to achieve that work at that level.
Legislation Regulation Standard
The legislation is a law which
is given by the legislative
body.
Regulations contain a function
which supports the uniform
application of the law.
Standard is a document which
contains various guidelines.
The legislation is lengthy;
when it becomes ACT law it
covers several provisions.
Regulations are not long as it
is specific and regulations are
different for a different kind of
work.
Standards are made by the
regulatory body of any
organization
In every business, it is
mandatory to follow the law.
Regulations are the practical
implementations of the rules.
While doing work standards
should keep in mind.
The legislation is initiated by a
higher authority of the state.
Regulations are initiated by
the authority responsible to
make rules and guidelines.
Standards are initiated by the
regulatory authority of any
organization.
The legislation is given by the
country’s government.
Regulations are internal or
external given by the head of
any specific organization.
Standards can also be internal
or external depends on the
organization.
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The legislation became an
ACT after approval of
parliament.
Regulations are a part of Law. Standard is a part of
regulations.
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Task 2-(LO3)
This part of the assignment deals with the legal procedure for the formation of business. It also
deals with the analysis of funding methods chosen by the organization.
In the present context, Jane, penny and Marie have established JPM publishing a partnership
business. For many years they run their business successfully and now planning to expand the
business operations and for that extra funding are needed. Their legal advisor has suggested them
to transform their company form the partnership to the company. To transform the business there
is a list of options available with the business owner to expand their business (Bench-Capon,
2015).
Unincorporated business
This type of business is not listed as a corporation. The liability of the business is unlimited in
this case. This type of business is owned by private entities. In the unincorporated business, the
owner of the business does not need to do much paperwork and follow legal procedures of
incorporation of the business. Unincorporated business does not have any legal structure and
they are not legally bound by any legal action. If the JPM decides to start the business as an
unincorporated business they do not require doing much paperwork and follow and any legal
proceedings.
Management of an unincorporated business is done with the help of appointment of managers
often but in most of the cases, the owner and manager are same legal entity though it reduces the
time for decision making it also leads to inefficient management and also make management
complex.
Funding for unincorporated business for this business is done with the help of relatives and
acquaintance. It is done in the form of a loan. The partners of the business have some liability to
repay. There is no legal structure for management and funding. It increases the risk associated
with the business. But to borrow there is no need to follow any legal requirement, so it saves the
time of business owners (Bessière et al., 2019).
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Partnership business: it is the type of business in those business entities decides to form a
business organization with the same aims and objectives. In the partnership business equal
profit, fund sharing is required by the partners. The partnership business and partners are the
same legal entity. In the JPM if the partners go for business expansion they need to share equal
contribution in the business.
Sole proprietorship
This type of business is owned and managed by a single entity. Owner and business are not
different legally. JPM cannot choose this type as it has ownership of a single individual.
Incorporated business
In the incorporated business, the business unit is required to incorporate as a legal entity. These
business units are required to follow the legal acts and process. They are also bound by the legal
acts, rules and regulations. In these business and owners are treated as separate entities. In the
JPM if the partners go for business expansion they need to register their business as an
incorporated business and after the registration, they need to follow legal procedures (Bench-
Capon, 2015).
Management of Incorporated
Management of the business can be done with the help of managers, directors and the
executives of the business and for the effective management of the business appointment of
managers is also undertaken. Decision making can delay at times due to many stakeholders but
the experience of them can also protect the organization from wrong decision making.
Funding for incorporated business is managed by taking debt from the market and also taking
loan form the banks. This process requires time and legal paperwork but it is a safe route to make
money. JPM can choose this alternative to expand their business
Limited partnership
It is a type of partnership in that organization has one general and one limited partner. Company
is a separate legal entity in this case. The liability of the business is also shared between the
partners. JPM can choose this alternative to expand their business (Bessière et al., 2019).
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