Business and the Law
– By Amaatimin Tertsegha Timothy, Esq
Business and law are like siamese twins i.e. closely related and intertwined in theory and practice. The aforementioned postulation underscores the fact that, an understanding of the legal framework is essential for businesses in any country to operate effectively and avoid legal issues in the long run.
The intersection between business and law, is commonly made visible in business formation, which deals with laws that govern the formation of business entities such as corporations, partnerships, and limited companies (LLCs). Meanwhile, contract law concerns itself with the agreements businesses enter into with customers, suppliers, and employees. Furthermore, tax law, intellectual property, regulatory compliance and alternative dispute resolution further justify the marriage between business and law.
For the purpose of this engagement, anticipatory I crave your indulgence to limit this episode to business formation. The registration of companies globally offers company owners (loosely speaking) a special legal protection i.e. it limits the personal liability of company shareholders and directors (agents of the company) in respect of business transactions undertaken or concluded in the name of the company.
The idea of limited liability, globally is one of the greatest legal innovations of all times. What the concept seeks to achieve is the protection of company shareholders from liability, as their corporate liability is LIMITED TO THE AMOUNT OF SHARES SUBSCRIBED OR TAKEN IN A COMPANY BY THE SHAREHOLDERS.
