Economic, Business and Commercial Laws
Core concepts
This domain surveys the legal environment of business: the law of contracts, sale of goods, negotiable instruments, partnership, competition, consumer protection, foreign exchange management, and insolvency. You must know the essentials of a valid contract (offer, acceptance, consideration, capacity, free consent, lawful object), void and voidable agreements, and remedies for breach.
Commercial law content includes the rights of an unpaid seller, conditions and warranties, negotiable instrument essentials and dishonour, and the resolution professional framework under insolvency law. Economic law covers competition prohibitions on anti-competitive agreements and abuse of dominance, merger control thresholds, and consumer rights including unfair trade practices and product liability.
Traps
- Treating consideration as always needing to be adequate; it must be real but not adequate.
- Confusing void agreements with voidable contracts.
- Mixing conditions with warranties in sale of goods remedies.
- Assuming every merger needs approval; thresholds and exemptions apply.
- Confusing the roles of the adjudicating authority and the resolution professional.
Worked example
A agrees to sell goods to B and B pays in advance; A fails to deliver. B may claim damages and, where the property has not passed, may treat the contract as repudiated. If property has passed, B's remedy differs. Identify whether property passed before choosing the remedy - that single fact changes the answer.
For competition questions, first classify the conduct as agreement or unilateral abuse, then test the effect on competition.