Commercial law is an intricate and ever-changing sector, and it is essential that business owners are aware of their legal rights and obligations.

At its essence, commercial law encompasses legal relationships and the laws governing business transactions between businesses and businesses, as well as those between businesses and individual consumers.

Commercial law encapsulates a wide range of legal services, typically involving contracts and the rights of parties in relation to goods and services. This is crucial for maintaining business order, avoiding disputes, safeguarding the protection of one’s rights, and ensuring smooth commercial activities.

Whether you’re a dynamic start-up, a prominent multinational corporation, or anywhere in between, it is crucial to understand the basic foundations of commercial law to ensure the protection of your business and its reputation, to manage expectations of the party on the other side of the commercial deal, and to protect the goods and services you provide.

A thorough understanding of commercial law enables you to navigate any business-related issue promptly and effectively, and should ensure the commercial relationship remains smooth and successful.

In the following article, we have discussed the fundamental principles of commercial law which you must be aware of.

Contract Law

Contract law is a civil area of law governing the regulation of the creation and performance of contractual obligations between two or more parties. Under relevant legislation, a contract requires an offer, acceptance, consideration, and intention to create legal relations.

In simpler terms, if one makes an offer to another, and they accept it, both parties enter into a legally binding agreement. Failure to comply with contractual obligations can result in a breach of contract. This means that the opposing party can seek legal remedies to enforce the contractual terms, bargaining the legal right to recover monetary compensation for their loss in damages. Additionally, further remedies could include fulfilment of specific performance, injunctions or contract termination.

A thorough understanding of the depths of contract law can help ensure the safety and security of your business when entering contracts and help you to navigate through any potential legal disputes effectively.

Business Terms and Conditions

If you aim to grow your business compliantly and profitably, it is essential that you establish appropriate terms and conditions of your goods and services to help safeguard your company’s interests. It is of pivotal importance that your terms and conditions reflect the industry you operate in, catering to unique operational requirements.

Essential business terms and conditions could include:

• Details of goods or services

• Payment and pricing terms

• Cancellation and refund policies

• Privacy and data handling

• Liability (i.e., legal responsibility) and dispute resolution (i.e. setting out a process for solving conflicts)

While there is no legal requirement for businesses to implement terms and conditions when providing goods or services, it is strongly encouraged. Without these, your business may appear less professional to prospective customers. Moreover, the incorporation of terms and conditions, which should be presented with clarity, allows for a greater layer of protection in case of implications.

Terms and conditions are essential to ensure that consumers are aware of their purchasing obligations, as well as the potential repercussions should a customer fail to meet such obligations.

Consumer Protection

Consumer protection laws ensure that buyers of goods or services are treated fairly, without being misled. The Consumer Rights Act 2015 is the crucial legislation in place, imposing additional protections and remedies for individuals over businesses.  Businesses entering a contract are expected to have knowledge of what they are getting into, or be in a position where they can seek legal advice to understand the terms of a contract.  Individuals are often not in that same position, so the Consumer Rights Act 2015 imposes remedies such as repair, replacement and refund if goods or services are faulty or, in the case of services, not provided with reasonable skill and care.

Under the same legislation, businesses are prohibited from falsely advertising or withholding any necessary information. To mitigate risk of unfair practice, agencies including the Competition and Markets Authority and Trading Standards work towards the enforcement of these laws. Therefore, it is essential that your business is cooperating in accordance with current regulations in place to prevent obligatory refunds, breaches of customers’ statutory rights, fines, or prosecution.

All businesses, no matter the nature, size or industry, must ensure they are compliant with these laws. This means any goods sold or services provided, must meet a certain standard, expected by the consumer or promised by the entity.

The consequences of not complying with Consumer Protection Laws

Compliance with regulations is crucial as failure may lead to investigation by the local authority’s trading standards service, resulting in prosecution and fines for businesses.

Once again, the size and nature of the business in question is unimportant, as the consumer is placed at the centre of this legislation, with the main aim being their protection and safeguarding when engaging with businesses, purchasing their goods or services.

What now?

As a businesses, startup, entrepreneur or freelancer, compliance with the legislation set out above is paramount. Not only will compliance ensure you are delivering products and services of standard, but will ensure you are not acting unlawfully, which can result in several negative consequences, often make or break for a business.

Are you unsure if you are compliant? Are you in need of legal review or support to ensure your business meets the expected standards as set out by law?

At Hartley Law, we are experts in all matters of commercial law, and have vast experience working with both luxury retailers and small businesses – including sole traders and startups. If you would like to discuss where you may be in need of legal support or guidance, get in touch by calling us on  01276 536 410, or emailing us at hello@hartleylaw.co.uk , we would be delighted to discuss your immediate needs free of charge, and understand how we can best assist you.