Legal and Regulatory Framework for Business
Core concepts
Business law governs formation, operation and dispute resolution. Understand the essentials of a valid contract: offer, acceptance, consideration, capacity, free consent and lawful object, plus the requirement of intention to create legal relations. Know void, voidable and unenforceable agreements, and the meaning of breach and remedies (damages, specific performance, injunction).
Company law concepts: incorporation, separate legal personality, limited liability, memorandum and articles of association, prospectus, and the roles of directors and auditors. Understand the difference between a private and a public company on membership, share transfer and capital raising.
Regulatory topics include consumer protection (rights and redressal), competition law (anti-competitive agreements, abuse of dominance), and basic principles of labour legislation, taxation and intellectual property. Know the broad purpose of each regulator rather than isolated section numbers.
Traps in questions
- A void agreement is invalid from the start; a voidable contract is valid until avoided by the aggrieved party.
- Consideration need not be adequate, but it must exist and be lawful.
- A private company restricts share transfer; a public company does not.
- Separate legal personality means the company, not its shareholders, owns assets and bears liability.
Rule of thumb
Test every contract question against the essentials in order: offer, acceptance, consideration, capacity, free consent, lawful object. The first missing element usually identifies the answer.
Worked example
A minor signs a contract for goods. Capacity is missing, so the agreement is void. Even if the minor received the goods, the contract cannot be enforced against the minor under ordinary contract rules, though restitution may be considered separately.