Commercial law is one of the most important legal areas of your business.
This area of law deals with matters relating to commerce and trade between businesses and consumers, and it also reaches out into areas of employee contracts, business contracts, financial transactions and more.
Most businesses engage in commerce with their customers without really giving any thought to the legal side of it. Well, it’s about time they should because a knowledge and understanding of commercial law can play a big role in your success.
It can also prevent you experiencing any headaches with customers that could have been avoided if you had an understanding on commercial law and how to use it in your business practices.
Read on to find out why commercial law is a must-have requirement essential to your business success.
Why Is Commercial Law Important?
Commercial law effectively governs trade between businesses and consumers. It creates a regulated system that is fair for both parties so that trade can be conducted in a reasonable manner.
Without these sets of laws that govern how commerce is conducted, it would create a wild west scenario that would end up crazy for both businesses and consumers. The job of any commercial lawyer is to ensure that a business conducts commerce in line with the regulations and laws of the country they’re operating in.
So as you can probably tell now, it’s an important field of law to have some knowledge of if you’re a business owner.
And below you’re going to see exactly how it’s essential to your business’ success.
Helps Resolve Conflicts And Disputes
There are a few stages that generally occur with conflicts and disputes. They are negotiations, mediation, arbitration and then litigation. These are the stages of any conflict or dispute resolution.
Unless you are schooled in commercial law, this whole process will leave you feeling overwhelmed. Without a commercial lawyer on your side, you’re not going to know where you stand or how to even approach any disputes or conflicts.
So it goes without saying now that a commercial lawyer is crucial for any successful dispute or conflict resolution between a business and consumer. Also, be aware that any lawyer will do their utmost to avoid any disputes going to court but this is something you won’t be able to avoid without their expertise.
Outlines The Legal Responsibilities Of A Business And Consumer
If you’re engaging with other parties like customers or suppliers to make your business a success, you need to know that you’re obligated by a set of legal and ethical responsibilities as a business owner.
In the business to consumer transaction, as soon as money exchanges hands you are now obliged to fulfil certain legal responsibilities as a business owner. For example, if customer pays for a product, you need to make sure that the customer actually receives what they paid for.
However, it becomes more complex. You also need to make sure that you have outlined well-defined terms and conditions of doing business with you because customers also have certain obligations to fulfil. For example, you’ll want to make sure that you outline when a customer can and can’t lodge a refund. You’ll want to define in your terms and conditions how customers can lodge disputes.
Essentially, what this is, is legally outline the responsibilities and relationship between a business and a consumer.
This will also protect you especially from disputes and conflicts as mentioned in the first point. Without clearly defined expectations you could find yourself facing the silliest of lawsuits and there won’t be much you can do to avoid it.
Help Understand And Manage Financial Transactions
If you’re exchanging money with other businesses, consumers and even banks you need to know what your obligations are. You also need to understand the legal conditions that govern any exchange of money in the marketplace.
This is even more relevant for big businesses who are most likely exchanging sums of money in the millions of dollars bracket. A commercial lawyer can make sure that you’re legally covered from all angles before any financial transaction occurs. You’ll know if there are any risks involved and if so, how you can mitigate or minimise those risks.
They’ll also be able to draft up legal documents so you’re protected on paper. This will clearly state the terms of the financial transaction, outline any risks involved and more.
Banking and exchanging money is a serious area of business management and commercial lawyers can greatly help you in this area.
Final Words: Commercial Law And Success
We’re sure that by now you can see how important commercial law is to your business success. Without it, you are exposing yourself to many unnecessary problems that could potentially ruin your business or affect your business’ reputation.
The smart thing is to make sure that before you start your business, that you’re covered from the ground up in this area of law. Speak with a commercial lawyer and make sure you’re legally covered in advance with necessary documentation and conditions for engaging in commerce.