There are different types of activity in a society. Business is also a part of
social activity, regulated by the law. Business refers to the economic
activities in which goods and service are supplied in exchange for some payment.
It includes buying and selling, manufacturing products, extracting natural
resources. Business law is the law concerned with business activity. Business
law is an aggregate of those rules, which are connected with trade, commerce and
industry. It is also known as commercial or mercantile law. It is the law which
provides the different provisions to the commercial community and regulates
their activities relating to the trade and commerce. Which includes the law
relating to contract, sale of goods, agency, industry, guarantee, insurance and
banking, arbitration, foreign investment and technology transfer etc. Business
law is not separate discipline, it is a part of civil law, which deals with the
right and obligation of business firms that arises from there business activity.
There are different laws in which the significant provisions are made to
regulate the business related activities, and these laws are known as business
law.
According to N.D Kapoor: " Mercantile law is also used to denote
the aggregate body of those legal rules which are connected with trade, industry
and commerce."
Features of Business Law
i) Regulates industry, trade and commerce.
ii) Regulates every business activity of business
community.
iii) It has no watertight demarcation with the other branches of
law.
iv) Promotes rights and interest of business
community.
v) this is the most important means to create positive
environment for the prosperity of business.
With the increasing complexities and technologies of the modern
business, the scope of business law is automatically extended.
Importance of Business Law:
The business law leads the prosperity of a country. It
regulates......
and affect the business since before the
establishment of business firm, while conducting the business and to its final
stage. The role of business law is vital in the business sector, but it is
guided by the economic policy of the state. A business person must know all the
concerned laws. Such laws play vital role for the formation and commencement,
running, adapting, establishing, giving dynamism and expansion of the business
as well as fulfilling business goals and maintaining social responsibilities.
The importance of business law can be viewed on the following grounds:
a) protection of economic right
b) Regulation and Systematization of business
c) Commencement and development of business
d) Enforcement of business Contract
e) Delivery of Justics
( you can consult with your book for the brief explanation of
the above points)
Sources of Business Law
A source means an origin or resources or cause or place from
where law emanates. The term source of Nepalese business law denotes two
meaning. Firstly the place or point from where the law begins and secondly the
place from where the rules of business activities get legal authority. The main
sources of business law are discussed below:
a) Custom and Usage: The custom is known as particular way of
life or behavior. If such behavior is followed continuously by the people in the
society, it becomes a customs or usages which are important sources of law. This
types of custom should not oppose to statutory law, mortality and public
welfare. If there is no legislation, no precedents the matter is to be decided
by the custom or usage of that particular.
b) Statutes/ Legislation: The legislatory law come from
parliament or law making body of the nation. This types of law is the outcome of
demand of people and need of the time. It is made after fulfilling a series of
discussion by lawmakers. Now a days most of business activities are regulated by
the law made by parliament.
c) Judicial Decision: Judicial decision are known as precedent.
Precedent is a judicial decision which contains in itselfs a principle. In other
words it is the earlier decision of supreme court which is taken as a rule while
deciding the later cases. Where there is no law to deal the problems in such
cases the court can make decision in the light of justice and equity such decision are treated as law for that matter. It is the one of
the major sources of modern business law.
Other Sources ( this should be included in your answer the
difference is that the above are the main sources)
d) English Mercantile law: business law was developed in
England. It is the pioneer of business law
in the world. Nepal is conjoind influenced by the British
rule since year.
e) Professional Opinion of experts: Lawyers and critics may play
significant role creating good legal environment. The opinion and explanation
made by such professional may give proper instruction and better contribution to
the development of law.
f) Business Agreement, Conventions: Conventional law refers to
any rule or system of rule agreed upon by the parties to regulate their business
conduct. International business organization are more active in national, region
and world business nowdays. Examples: ( WTO, SAFTA) . And bilateral agreement
between the nations and conventions of business communities are the main sources
of national and international business law.
Legal Environment
Legal environment of business refer to the aggregate of
surrounding connected with the law that influence the business activities and
business firms. It refers to the aggregate of all types of law, regulation. Acts
and precedents intended to encourage, protect, guide the business activities.
Such law are made and enforced by the state for the prosperity of every aspect
of business.
According to Prem R Panta " The legal environment refers to the
framework of laws, regulation are court decision, intended to encourage, guide
and control business activities. “
