Creating a business to some might appear as an easy task, but to some it may involve a lot of things. Individuals who are financially stable and have already built several professional contacts or have other business premises somewhere might find starting a new business very simple, this contrary to the new beginners. Apart from abiding by the legal issues governing the business operations, one will require or comply with a number of things that will ensure the business run smoothly and able to make good profit (Hill, 2014). For an individual to start a business, he / she must come up with a business plan, business plan is important because it will guide you on how to start and run your business successfully. Secondly, theirs need to get a business assistance and training since this will impart you with necessary knowledge on how to run your business. Choosing a business location is an important factor, choose a location with high demand for your products and finally, find a way on how you can finance your business such as loans from commercial banks and research grants.
After starting your business and its operating successfully, there are laws that apply to your business that either makes it run successfully or provide restrictions against some of the operations. Business law can be defined as enforced ethics that govern the operation of business and services. Human beings have five senses but if we use our common sense which others consider as the sixth sense, then we’ll make a good law. Let’s take a look on how laws apply to businesses in the current society, and our first discussion will be on the taxation. Businesses operate to earn some profit, and out of this profit earned there is a portion they pay as tax to the government. That brings as to the tax law which monitors and regulate how businesses pay taxes to the government. Tax law divides the businesses into single owner operations, partnerships and cooperation owed by a group of stock shareholders. According to this law, single business owner operations report business earnings on individual income tax returns while the cooperation are considered tax entities separate from the owners.
The second law is the antitrust law the governs on the business competitions, in fact this law basically promotes fair business competition among companies and business organizations. It operates by deterring vindictive business behaviors such as price fixing and monopoly. Most of the governments tend to promote business competition because it is healthy for a developing economy, business competition leads to better products and services, because most of the companies will struggle to produce quality products more than the competitor to increase its market demand and this also encourages fair prices. An ignorable business law is the intellectual property law; intellectual property evolves around creative business operations such as creating of company logos, art, literature and inventions (White, 2014). Intellectual property laws provide legal protection to the creators of these intellectual properties, where they have a right to own their creation and sue any individual or company that will copy the same without permission from the owner. An intellectual property law prevents business competitors from stealing each other’s idea and in turn competes fairly.
Different laws apply to protect business premises and societies combined, to begin with; we’ll take a look at criminal and civil law. Criminal laws are set of laws that are formulated to punish individuals who don’t respect the law; criminal laws were formulated to protect the society as a whole. A good example is where a gang of thugs evade a community bank and made away with all the cash but luckily they are captured with the police. In this case both the criminal and civil law will apply; these thieves are a threat to the society hence they will be tried in a court of law according to criminal laws. The same time, the bank is a business organization and it will incur losses as a result of the stealing and they might get compensation from the insurance company in case the bank was insured against money stealing, and this is where the civil law comes about. Civil laws are group of laws formulated to compensate individuals or business organization as a result of conduct of another person’s business. (White, 2014) The second law we’ll look at will be the substantive and procedural law; Substantive law provide individuals with some specific rights and duties that govern them in certain situation, while procedural law provides a legal framework, procedures and processes on how to pursue the substantive rights. These two laws are there to protect the entire society, and how does these two laws protect the society? A good example is the same we’ve used on civil and criminal laws; these thieves rob the bank and kill one of the employees in the process, but killing of innocent citizen is illegal according to substantive law, therefore procedural law will provide a procedure on how the robbers who committed this heinous act will be prosecuted in the court of law.
Our final group of laws will be public and private laws; public laws are derived majorly from the legislature as a bill, there after the president can sign it into law or reject it for further reviewing and amendment by the legislature. Public laws are created basically to promote a good relationship between state and its citizens. It provides guidelines and functions of different structures of the government; public laws incorporate both the administrative and constitutional laws. Private laws are group of laws formulated to protect the individuals with which the state is not directly involved; these laws includes property laws, family laws, laws of contract and trust laws (Hill, 2014). These two laws focus on relationship between two parties within the society, using the same bank robbery as our example, the family of the bank employee killed on the process of robbing shouldn’t be compensated by the bank as a company, but the thief who was directly involved should take the liability. In conclusion, laws are there to protect the society and without laws we can’t have a peaceful society and a productive economy.
- Hill, C, W, L, (2014). International business: competing in the market place.
- White, G. E. (2014). American legal history: A very short introduction.