What Is The Difference Between Business Law And Commercial Law?
If you are looking to hire a lawyer for your business, it is essential to hire one who can adequately meet your business needs. Business law and commercial law are two fields of legal practice with many overlapping areas. Usually, an attorney who practices one of the two will also be proficient at the other. Are you shopping for a lawyer to handle all of your business' legal needs and obligations? If so, a Business attorney from Boyer Law Firm is an excellent choice.
Any operational business will need a lawyer experienced in both these fields or two different ones specializing in business law and commercial law. This article will help you choose the right lawyer by highlighting the differences between business and commercial law. You will also get handy tips on choosing the best lawyer for your business.
Difference Between Business and Commercial Law
The significant difference between business law and commercial is that the former comprises different practice areas associated with running a business, e.g., tax, employment, transaction, and contract law, while the latter governs how businesses are managed and administered. You can consider commercial law a subset of business law that regulates the formation and administration of various enterprises, e.g., sole proprietorships, partnerships, limited liability companies, and corporations.
Law firms usually have practice areas for both business and commercial law. Business law usually includes corporate law and all transactions that affect the life cycle of a business, including mergers and acquisitions. Commercial law offers a legal structure that companies can use to conduct and govern a wide range of areas, including contracts, zoning, securities, intellectual property, innovation, franchising, and litigation.
When trying to distinguish between business and commercial law, it helps to look at the business in terms of activity and commercial law in terms of the company as an entity affected by different life cycles. Since business and commercial law overlap in various areas, it is good to look at each category separately to understand the distinctions better.
Commercial law focuses on financing various transactions and sales and distribution. It is regulated by the Universal Commercial Code (UCC). The UCC is a model set of laws that oversee the sale of goods, negotiable instruments, leases of goods, and secured transactions. All states have adopted a version of the UCC and are free to modify the law that they deem fit. Since states have adopted different forms of the UCC, it is essential to hire a lawyer who is well versed in your local region's particular UCC provisions.
Commercial law also includes corporate law that covers aspects like management duties, corporate operations, and shareholder's rights. Corporations are considered to be legal entities that are separate from their owners. They need legal representation to enter into contracts and file or defend against a lawsuit. Shareholders also have the right to efficient legal representation of the corporation's interests.
Liquidation and capital increase fall under corporate law and shareholder agreements, investor agreements, types of shares, taxation, and distribution of corporate assets. Shareholders and investors have a right to dividends from the extra profit that the corporation records and can sue if funds are not distributed as contractually agreed. Corporate law is administered and created by the Uniform Commercial Unit (UCU). Business laws have a broader legal influence and are more widely used.
Business law is concerned with the technical aspects of business like forming a company, shareholder rights, mergers and acquisitions, and property issues, including leasing warehouses or office space. It is regulated by both federal and state law. State law usually adds to federal law or passes unique laws in certain areas, e.g., licensing requirements for some businesses and regulation codes for forming and running businesses legally. The federal government usually governs stocks and investments, environmental protection, workplace safety, and employment laws.
A business lawyer will ensure that your business complies with all relevant laws and regulations. They will look into aspects of employment such as hiring and firing to ensure that they are fairly managed. A reliable lawyer will also ensure that your business maintains safe workplace conditions on all premises. You need competent advice on basic business transactions that will prevent your business from being the target of lawsuits.
All businesses have tax and financial obligations that must be met with punctual efficiency. Business law also includes tax law. Your business lawyer will see to it that your business is fully tax-compliant and saves you money by taking advantage of any exemptions your qualify for. They will explain the benefits and obligations associated with different kinds of business entities. If you do not keep up with your tax obligations, you will incur expensive fines or even a prison sentence.
Business law also covers product defects and delivery delays. Your business lawyer will oversee interactions between your business and third parties like customers, vendors, suppliers, etc. A reliable lawyer will ensure that provisions on terms and conditions, reselling, licensing, and intangible items are above board and not oppressive to your business interests.
Other Considerations When Hiring a Business and Commercial Lawyer
All businesses face their own unique business law and commercial law issues. Choosing a lawyer with experience in your industry will enable you to get practical advice and solutions to your legal matters. A lawyer specializing in your kind of business provides solutions that take into account your business ethics and industry practices.
Do not hesitate to hire a qualified business or commercial attorney for your business. Many business owners hesitate to hire an attorney, and when they do, it is usually after they've been sued or landed into other legal trouble. Be sure to consult a competent lawyer early in the contract negotiation or hiring process to ensure that your legal rights are well-protected. Shop around for a lawyer who has good reviews and testimonials from other businesses in your industry.