Business Law: Analysis of Business Organisation in the UK

This report provides an overview of UK business law, focusing on the legal requirements for establishing and operating a business, particularly within the context of an IT consultancy. It explores different types of business organizations, including partnerships, private limited companies, and limited liability partnerships, detailing their formation processes, registration requirements, and advantages/disadvantages. The report examines the roles of directors and company secretaries, and discusses various methods for raising funds in both partnerships and companies. The analysis concludes by recommending the most suitable business structure for an American manager unfamiliar with UK business law, advocating for a private limited company due to its limited liability and legal recognition. The report references relevant legal and governmental resources.

Business law

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
How different types of business organisation are legally formed in England............................1
Is there any requirement to register a partnership firm? Does person requires to register a
company?....................................................................................................................................2
How many directors & Company Secretary are required to start a company?...........................2
How to raise fund in Partnership and Company and is there any legal rules which is needed to
be followed while raising fund....................................................................................................2
Advantage and disadvantage of forming partnership as compared to company.........................3
Which is the suitable form of business organisation and why?..................................................3
CONCLUSION................................................................................................................................3
REFERENCES................................................................................................................................4

INTRODUCTION
Business law is explained as collection of legal requirements for the propose of forming,
operating, dissolving and engaging with a business. It is necessary because it guides that how an
organisation can be managed. In context of the file, there will be detail description that how IT
Consultancy can setup their business within the premisses of UK. Different types of business
organisation will be also discussed in it.
MAIN BODY
How different types of business organisation are legally formed in England.
Partnership: It is defined as the form of business entity where different people gathers
for performing business activity at same platform. There are various benefits in this form of
business because it is easy to perform and there are less burden in it due to number of business
organisation prefer partnership firm as compared to other business organisation. While setting
partnership firm, it is necessary that name of firm should be selected and after that it is important
to choose nominated partners for a firm (Set up a business partnership, 2019). Then, nominated
partners have to register a firm for HMRC for sending partnership tax return.
Private limited Company: It is type of organisation which is managed and organisation
by members. Only limited number of person can become the part of organisation and once they
join the company, they are not allowed to sell there share to outsiders. This type of business
organisation gets numbers of benefits as compared to other business organisation and even it is
easy to perform. While setting up of private limited company there are number of condition
which is needed to be fulfilled and they are:
 Select organisation name with address,
 list of members who will join the company,
 preparation of legal documents such as article of association and memorandum of
association,
 must pay the registration amount and
 finally all of the documents must be submitted to Companies House to start business
activities (Peterson and et. al., 2016).
Limited Liability Partnership: The form of business organisation where liable of every
member is limited except one member who takes the responsibility of each and every work. He
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is known as general partner. This types of partnership firm are more secured and safe as
compared to general partnership firm. There is a lengthy procedure to setup limited liability
partnership firm as it starts from selecting the name and address. Secondly, detail about each
and every partners with proper information about general partners. Then documents are needed
to be submitted in Companies House.
Is there any requirement to register a partnership firm? Does person requires to register a
company?
As HMRC will keep all of the records related to partnership tax so it is not necessary that
partnership firm should be registered (Legal structures for businesses - an overview, 2018). This
is one of the reason that organisation do not get the right of legal existence. While talking about
Companies, they are needed to register their business organisation because company is a legal
person and for that it must be registered within Companies House.
How many directors & Company Secretary are required to start a company?
While setting up of business, there are number of requirements which is needed to be
fulfilled. Among all of the requirements, appointing directors and company secretary plays the
crucial role because they will decide that how company is needed to be run. While talking about
private limited company, they requires to have at least one director in the organisation who can
manage daily basis work. In case of Company Secretary, there is no requirement to appoint them
for a company like private limited Company (Appoint directors and a company secretary, 2019).
How to raise fund in Partnership and Company and is there any legal rules which is needed to be
followed while raising fund.
There are number of ways through which partnership as well company can raise fund.
Whenever capital is raised, it is necessary that various documents are needed to be presented so
that fund can be provided. Some of the ways through which fund can be raised in partnership
and company are:
Partnership firm
 Loan from Banks, PFI can be the option
 Credit Card Introducing additional capital and many more.
Company
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 Issuing of share, debenture
 Deposit from member
 Commercial paper
 Peer to peer lending and many more.
Advantage and disadvantage of forming partnership as compared to company
There are number of advantages and disadvantage of forming partnership as compared to
company and they are:
Advantage:
 there are less paper work in partnership firm but not in a company (Cameron, 2017). There is no double taxation rules and regulation but in case of company, it is vice versa.
Disadvantage
 Partnership firm doesn't get the right to sue on the name of organisation but company is
legal entity and they gets legal rights in it to sue on organisations name.
 There is restriction on including additional number of member but talking about company
any of the member can connect and leave organisation and there is no restriction on it.
Which is the suitable form of business organisation and why?
As manager is American and doesn't have additional knowledge about business
organisation in England, so it will be better for her to setup an private limited company. Here,
they will have limited number of member who will connect with organisation. This types of
company will get the right to sue and be sued on the name of business organisation. In addition,
company gets various benefits as compared to partnership firm.
CONCLUSION
From the above project, it has been concluded that business law is necessary in context
of any business organisation. Association can be setup in different form such as partnership firm,
private limited by share and many more. Different business organisation have different types of
benefits so it is the decision of investor that in which form of business organisation they want to
invest their capital for conducting business activity.
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