Business law, also called commercial law, is a body of law that governs commercial entities and commercial transactions. For example, if an individual were to open a shoe business or company, business laws would provide guidelines about how the business should be organized and registered.
Business laws apply to almost all aspects of a business. They outline regulations for everything from paying employees to legally shipping merchandise to consumers overseas. Business laws vary based several factors, including:
- The type of business, including private and public and/or for profit and non-profit;
- The structure of the business, including a corporation and/or a general partnership; and
- By the jurisdiction in which the business is located.
A specific example of a business law is the Federal Tax Code. This code affects both businesses and taxes. The Federal Tax Code includes everything from how a business will tax its employees to how a business will file its own federal income taxes.
What are the Different Types of Business Law?
As previously noted, there are many different types of business laws which govern most aspects of a business. For example, employment law, a subcategory of business law, governs how a business will:
- Pay its employees;
- Provide its employees with work benefits; and/or
- Arrange its employees’ work schedules.
The owner of a new business will be required to register and set up their new company. Business laws, which include statutes governing the formation and structure of the business, state tax laws, and the Federal Tax Code, all apply. In addition, federal and state laws regarding intellectual property will apply if the business owner registers a copyright and/or a trademark.
A large portion of business law includes commercial laws and contract laws. These laws govern issues including:
- A business deal;
- A sales transaction; and
- An employee non-disclosure agreement.
Contract law is arguably the most important area of business law because it regulates such a large portion of business law. Contract laws regulate numerous aspects of the operation of a business, which include:
- The business merging with another business;
- The formation of an agreement between the business and a distributor to sell products; and/or
- The manner in which the business will provide services to its customers.
Business law includes federal laws, state laws, and local regulations. There are numerous specialty subcategories governing businesses. These apply to both individuals and business entities. These subcategories may include:
- Business formation and/or dissolution;
- Commercial law;
- Contract law;
- Securities law;
- Intellectual property law;
- Antitrust and white collar law;
- Corporate law;
- Bankruptcy law;
- Employment law;
- International business law; and
- Tax law.
In addition to these subcategories, there are further subcategories of these categories of business law. Usually, more than one subcategory of law applies to a business issue. Due to the intricacies and numerous categories of business laws, it is essential to consult with a business attorney for advice when starting a business and/or to discuss any concerns about the business.
What are Some Common Business Transaction Disputes?
Business transactions are events that involve the exchange of goods, money, and/or services. A business transaction occurs between two or more parties. They may occur between two parties that are engaged in business and are conducting the business transaction because it is mutually beneficial. A business transaction may also be between a business entity and a customer.
Common examples of business transactions may include:
- Investments of cash and/or other assets;
- Purchasing an insurance policy;
- Purchasing inventory from a supplier;
- The sale of goods and/or services to a customer for cash, or on credit; and
- The payment of employee wages.
A legal dispute will typically stem from the failure to adhere to business laws, whether federal, local, and/or state. These disputes are often resolved by referencing the governing contract, which a court will also reference in the event of a lawsuit.
For example, a dispute may arise between members of a business as to who may control the business. The disputing members as well as the court will typically refer to the partnership agreement entered into at the time the business was formed.
What are Some Common Business Law Issues in Illinois?
There are some common business law issues in every state, including Illinois. Certain disputes are more common than others. Some disputes arise because business partners have a dispute over how to manage their business.
Another common business dispute involves the goods a business sells. Issues that may arise include disagreements with third-party suppliers over goods that were shipped and/or the price of those goods. Contract law and/or commercial law generally governs these types of disputes. In a large number of cases, the parties can resolve their dispute by referring to the contract.
Disputes may also arise between a business and its customers. A customer may receive goods that are damaged and may reference the business’ guarantees and/or warranties to obtain a refund. In some cases, the business will replace the item. However, in some cases, the resolution may not be simple and may result in a lawsuit.
For example, if a customer purchases an item that includes an implied and/or express warranty and the business breaches the warranty, the customer may be able to bring a lawsuit against the business for selling a defective product. Both state product liability laws and commercial laws would apply to this type of case.
Business disputes may also arise regarding intellectual property, such as copyrights, patents, trademarks, etc. a common dispute involves theft of trade secrets. If an employee and/or another company steals a trade secret, such as a secret formula that belongs to the business, the business may sue for damages. A business dispute of this nature involves both contract law and intellectual property law.
Does Illinois Have Any Unique Business Laws?
Each state in the United States will have its own unique business laws. Most are fashioned after federal laws, but there may be variations.
For example, in Illinois, members and managers of a limited liability company, LLC, may live anywhere, as there are no residence requirements for directors. An Illinois LLC must have at least one member or manager. There are no requirements to have multiple members or managers to form an LLC in Illinois. There is also no age restriction regarding who can form an Illinois LLC.
Should I Consult an Illinois Lawyer for Questions about Business Law?
Yes, it is essential to have the help of an Illinois business lawyer for any issues regarding business law in Illinois. Business laws and disputes are often complex and involve multiple categories and subcategories of business law.
It is best to have the assistance of a business lawyer from the state when opening a new business. A lawyer will be able to provide you with advice regarding the formation of your new business as well as how to protect your intellectual property rights. A lawyer will help ensure your business is complying with local, state, and federal laws.
If you are being sued and/or need to appear in court as a result of a business dispute, a lawyer is an invaluable asset. A lawyer will represent you during any court proceedings. A local Illinois attorney will be aware of what Illinois specific business litigation laws will apply to your case, as well as any statutes of limitations, and caps on damages awards.
