Business Law BMP4002: Legal Sources & Business Structures in the UK

This report provides an overview of the legal context for business organizations in the UK, focusing on key sources of law such as contract law, company law, and employment law. It discusses different types of legal business structures, including sole traders, general partnerships, and limited liability companies, highlighting the advantages and disadvantages of each. The report also touches upon the roles and duties of company directors, the importance of the Memorandum of Association, and relevant legislation like the Companies Act 2006, Employment Rights Act 1996, and Equality Act 2010. Furthermore, it offers recommendations for IOM Solutions regarding business expansion, emphasizing the need to comply with legal requirements and establish appropriate business structures. Desklib offers a wealth of resources, including past papers and solved assignments, to aid students in their studies.

Business Management
BMP4002 Business Law
Assessment 2
Report describing the key sources of
laws as the legal context for business
organisations in the UK
Submitted by:
Name:
ID:
Contents
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Table of Contents
Introduction ...............................................................................................................................3
Businesses & Organizations in the UK........................................................................................3
The legal business structure of UK companies..........................................................................5
Sole Trader.............................................................................................................................6
General Partnership...............................................................................................................6
Partnership............................................................................................................................7
Limited Liability......................................................................................................................7
Recommendations for IOM Solutions........................................................................................7
Conclusion..................................................................................................................................8
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Introduction
Business law covers all those laws that state how to establish and run a
business and its prime purpose is to maintain order, establish generally accepted
standards, resolve disputes, protect rights and liberties, etc. The concept of business
law is important within the organization because it facilitates in extending as well as
maintaining business transactions. Within this report, IOM Solutions is taken into
consideration as an organization that demonstrates different aspects of this report
(Borgogno and Colangelo, 2020). Nature and management of organization in UK and
its related concepts like different types of law, Vicarious liability, Director's roles and
duties, Memorandum of Association and many more are going to be discussed in this
report. Along with it, different types of legal business structures of UK companies will
also be explained. Furthermore, recommendations will be given to IOM Solutions
regarding the business expansion.
Businesses & Organizations in the UK
The United Kingdom is one of the easiest as well as safest place to operate a
business in the world. It is the most productive place for innovation firms in the world
and has low tax rate environment for foreign investors. The country is having one of
the most stable political environment for establishment of a business and is also
having booming economy. Businesses and organizations within UK are enjoying a
large amount of profitability within their business and are able to sustain in the
competitive market place. A company is considered as a separate legal entity that is
formed by a group of individuals for engaging in as well as operating a business
enterprise in a commercial or industrial capacity. Management of a company helps it
in achieving its per-determined objectives by using its resources in an effective as
well as efficient manner (Cranston, 2020). The process of management provides
assistance to the company in planning, organizing, directing and controlling the
efforts of organizational resources to attain the goals of the business.
Within the organizations, the activities that are related to the trade and having
a proper legal structure helps in increasing the effectiveness of the business. These
types of organizations used three main laws within their business to maintain legality
and these laws include contract law, company law and employment law. These laws
help the business in making its operations more improved and effective. With the
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help of company law, a company is able to pursue on those aspects that makes the
business to be conducted legally. These types of laws facilitates in making business
operations conducted according top the objectives as well as goals of the business
that has been per-determined by the business organization. The business and its
related aspects as well as its operations deals within the Companies Act 2006 that
assists in framing guidelines as well as rules that provide assistance to business
organizations to function according to the legal structure of UK.
The Act primarily focused on the Memorandum of Association which is
needed to be formed by a company to conduct its business operations (Schrempf-
Stirling and van Buren, 2020). Under this process, the Directors of the company are
appointed for the purpose of running the business operations. These laws also
recognize regarding the rights and duties of the Directors that can be better
understood with the assistance of an example such as IOM Solutions that has
decided to expand its business and for that it is needed to make Memorandum of
Association as well as Article of Association according to the Act. Another type of law
that is used by the companies is contract law that helps the businesses in making
their agreements formed in between two or more companies that are willing to
establish organization. These kinds of laws allow a contract to be formed in the
written as well as verbal form that create expressed or implied contract more valid in
nature. These types of laws facilitate a business in binding its contract by making it
legal in the eyes of law. The components that are used in the process of forming the
contracts include offer, acceptance, obligation, legality as well as validity. If any of
the component is missed within the process of contract, then it cannot be formed in
any manner. Second component of acceptance is done over other party (Kreutzer,
2021). Component of obligation states rules and regulations that have been accepted
by parties through discussing validity of contract. Fourth component is based on legal
aspect that makes legislation to be formed within legal contracts to form the contract
legally. Validity is fifth component and is related to laws that are used within
formation of contract. It can be better understood with an illustration of YUT Ltd. and
JKL Ltd. As they want to make an agreement between them regarding contract of
trade. This agreement should be formed according to contract laws. Through this
examples, it can be interpreted that valid agreement has been made through contract
law that is applicable within UK. Third type of law is employment law that has been
created to protect employees over any sort of issues that have been faced by them
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while performing their roles within organization. This type of law has been formed for
making the strong relationship between employees and employer of the organization
while working. This law helps in increasing the effectiveness of an employee
performance as through this law all problems faced by them are solved with various
perspectives (Coles, 2018). There are several legislation that have been used in
order to solve issues which are based upon employment perspectives through
legislation that is Employment Rights Act 1996, Equality Act, 2010 and Minimum
Wages Act, 1986. for better understanding of development of an employment law, an
illustration of HAMES is here that has been bullied within business over color as well
as religion by high management persons. Therefore, high management can be sued
under Equity Law Act,2010 over generating discrimination at workplace. Such types
of organizations are related to various kinds of entities that are engaged with
industrial, commercial or professional activities. Hence, companies perform several
functions within a country such as UK. It helps in making business operations more
effective by applying business law on activities of organization. Such kinds of laws
have been facilitating in making business concerns and their performance more
effective according to legal aspects that helps the business in operating
organizational activities in a proper manner.
The legal business structure of UK companies
The legal structure of business organisation within UK are based on different
types of organisations which are having developed legal structure. Under legal
structure of the business within UK, there are two key types of organisations include
incorporated as well as unincorporated. Unincorporated companies involve those
businesses that are not formed with any complex process as well as facilitates
business in pitching up. In such types of organisations, there is no interference of the
government in order to start the business. It helps in forming such types of
organisation. The businesses that are covered in this type of organisations are sole
proprietor as well as partnership (Brown and Scott, 2019). Both kinds of
organisations are significant as they help in improving the effective of a business by
forming various aspects. Such types of organisations are very easy to be formed and
no legal entity exists within the business. In incorporated business. Public as well as
private companies are involved. These organisations together facilitate in making
the business to reach at global level. Public companies are those government
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organisations that works with Public Ltd at the end of its name as well as whose
shares are sold to the public. These companies are having multiple owners within
the organisations that helps in meeting organisational goals as well as objectives
effectively. In such types of business, various kinds of legal documents are required
by the businesses to start their business operations. These essential documents
include Memorandum of Association, digital structure of the owner and m,any other
important documents (Chiappinelli, 2018). In public organisations, two and more
directors with company secretariat are required to start the business. For these type
of organisations, funds are arranged through government institutions, community
services, public service programs, health programs, restorations programs and even
environmental programs. Private organisations are those that use Private Ltd. at the
end of its name and shares of such type of organisation are not sold to the general
public. In order to establish these types of organisations, all document is require to
be collected as well as submitted within Companies House to make the organisation
registered. Private companies are manage by the directors themselves and funds
are arranged through loans as well as debentures.
Sole Trader
These organizations has been used in a most common way to making
execution within the business. Under this type of organization, only the owner is
present that holds all responsibilities regarding business activities. Owner within such
types of businesses are sole proprietor and handles every business activity regarding
it. This has been using INHRC number to be registered and the name is only
provided to make the business identity possible. Organizational management can be
done by those persons who own the business. Funds are arranged through family
members, friends or other personal relationships in order to establish such type of
business. There are some advantages as well as disadvantages of this type of
business. The main advantage of this business is that all the profits earned in such
type of organization are to be kept by the owner only (Baleva, 2018). Another
advantage is that the process of formation of this business is very easy and simple
as it takes less time to establish such business. Disadvantage of sole trader is that is
is difficult to arrange the funds for the effective formation of the business. In such
kind of business, owner face heavy losses and makes all business activities handled
with a great difficulty.
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General Partnership
These types of organizations have been formed by two persons with an aim of
earning and maximizing the profits within the business. It is that component which
makes business to be covered with costs, responsibility, risks and benefits that run
the business organization. The profits generated within these organizations are
distributed between the partners of the company themselves. The registration
process in such type of organizations is related to the creation of INHRC number
(Oda, 2021). The agreement formed in these organizations are also based on the
partnership agreement that is associated with the partners itself. This type of
organization helps in making business operations more effective. Funds are
arranged through the investments of the partners that are present within the
business. Advantage of this type of organization is that the business has less formal
obligation and all the burden is shared by the partners themselves. The main
disadvantage of this kind of business is that it makes legal status that does not exist
and creates legal issues within the organizations that are to be faced by the partners.
Another disadvantage of this type of organization is that in case if a partner dies,
then the whole partnership gets dissolved.
Partnership
Such kinds of business organizations are formed when two or more than two
persons are involved in the business (Wakui, 2018). The primary objective of this
kind of business organization is that it focuses on earning and maximizing the
profitability within the business. This is one of the most effective perspective of the
formation of the business organization.
Limited Liability
In this business organization, partners come together as per their interest
within the business. The work is handled according to the investment done by the
partners. Advantages of this organization is that profit generation helps in running
business effectively and coordination among partners is another advantage (Manes,
2020). Disadvantage is that if any partner is not interested in investing then
organisation cannot operates its activities.
Recommendations for IOM Solutions
After making an analysis of above scenario, it is recommended that IOM
Solutions should go with Partnership form of organization to expand its business. It
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helps the organization in conducting its operations in a more effective manner. The
investment in formation of this business is less so it will be cost effective for the
business in future.
Conclusion
From above explanation of report, it has been concluded that business law is
an essential concept and has been used in order to make business operations
effective. With the help of law, business activities are conducted in an effective way
and also helps in preparing strong legal structure. Within this report, the different
aspects covered are based upon the business organisations along with its
advantages as well as disadvantages. Furthermore, legal recommendation has been
provided to the IOM Solutions for its business expansion.
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REFERENCES
Books and Journals
Borgogno, O. and Colangelo, G., 2020. Data, innovation and competition in finance:
the case of the access to account rule. European Business Law
Review, 31(4).
Cranston, R., 2020. Introduction 1. In European Banking Law: The Banker–
Customer Relationship (pp. 1-9). Informa Law from Routledge.
Schrempf-Stirling, J. and van Buren, H. J., 2020. Business and human rights
scholarship in social issues in management: An analytical review. Business
and Human Rights Journal, 5(1), pp.28-55.
Kreutzer, R. T., 2021. Toolbox für Digital Business. Springer Books.
Coles, R., 2018. Ship registration: law and practice. Informa Law from Routledge.
Brown, E. and Scott, I., 2019. Belief v. belief: Resolving LGBTQ rights conflicts in the
religious workplace. American Business Law Journal, 56(1), pp.55-113.
Chiappinelli, E. A., 2018. Cases and materials on business entities. Wolters Kluwer
Law & Business.
Baleva, M. K. A., 2018. Regaining Paradise Lost: Indigenous Land Rights and
Tourism: Using the UNGPs on Business and Human Rights in
Mainstreaming Indigenous Land Rights in the Tourism Industry. Brill Nijhoff.
Oda, H., 2021. Japanese law. Oxford University Press.
Manes, P., 2020. Legal challenges in the realm of InsurTech. European Business
Law Review, 31(1).
Wakui, M., 2018. Antimonopoly law: competition law and policy in Japan.
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