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Description
Flashcards by Julian Schepers, updated more than 1 year ago
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Created by Julian Schepers
over 6 years ago
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| Question | Answer |
| Commercial Law ( Wirtschaftsrecht): Overview | Business Law (Wirtschafts-Privatrecht) -> Contracts & Companies Regulatory Law ( Wirtschafts-Verwaltungsrecht) -> Authorities & Permits Tax Law |
| Commercial Law Economy | Commercial Law = the law that applies to the economy Economy = production of goods and services (+ offering them for sale) |
| Business law as a part of commercial law Business Law is part of? Private Law/Civil Law... Example: (Particular) Business law... | Business Law is part of Private law /Civil Law Private Law/ Civil Law deals with legal relationships between private persons (Individuals & Companies) |
| Private Law/Civil Law Example: (Particular) Business law... | Examples: Purchase contracts, lease contracts, construction contracts, labour contracts, damage for personal injury or for property injury, law-suits in such areas Particular business law deals with further matters, e.g. companies, labour law, bankruptcy etc. |
| Regulatory Law as a part of commercial law (1) Regulatory Law: | Regulatory law = law by which the goverment regulates / restricts economic activity. It is a part of public law = law which governs relationships between individuals or companies and the goverment |
| Regulatory Law as a part of commercial law (2) General trade supervision law: Import & Export | General trade supervision law: Health protection, environmental protection, consumer protection |
| Tax Law as a part of commercial law | Tax goverment imposes different types of taxes: Taxes on profits (e.g. corporate income tax) Taxes on sales (e.g. VAT) |
| Commercial Law = primarily domestic law | rules of CL are primarily promulgated (verkündet) by the legislator of nation states International business law is not primarily "international law", but primarily national law = domestic law, which varies from country to country |
| International Law: One main issue | The law of which jurisdiction apply to a specific commercial activity of a company? Commercial activity is e.g. purchase contract, damage claim against other business |
| Corporations: Introduction (1) | - Corporation is a seperate legal person - Final step of its foundation is registration in a public register, which is a formal process NO Liability of the shareholders for obligations created by corporation |
| Corporations: Introduction (2) | Act vis-a-vis third parties through (managing) directors - (Managing) directors appointed by shareholders - (Managing) directors and shareholders not necessarily identical persons |
| Corporations: Formation (1) | - Various documents to be signed and to be filed with register, e.g. shareholders (founders) sign articles of association (= agreement between the shareholders - Founders appoint first (managing) director |
| Corporations: Formation (2) | In many jurisdictions: Payment of share capital by founders to bank account of corporation (was opened by director with a commercial bank) Documents are filed with and reviewed by public register Registration of corporation in public register |
| Corporations: Origin of its business | Corporation founded from scratch starts with no business ----Shareholders transfer funds and assets to the corporation (= contributions)---Corporation acquires assets through business dealings of its own (director signs purchase contract for corporation by which corporation buys assets Shareholders may also grant loans to their corporation |
| Corporations: Groups | Major businesses are organized as corporate groups = a parent company controls 1 or more DIRECT or INDIRECT subsidiaries through direct or indirect majority ownership Parent is not liable for subsidiaries, may create liability through payment guarantee issued to subsidiarys creditor |
| Corporate chart (describe it) | |
| Freedom of contract | Principle: Freedom of parties to decide (i) whether or not to conclude a contract and (ii) the contents of the contract Contract may derogate from flexible statutory law, contract then takes precendence No derogation from rules of mandatory statutory law Matters not governed by contract are coverned by statutory law, unless application of statutory law is excluded in the contract |
| Contract negotiations: Main points | Object of contract ( sold assets/ services: scope, quality) Price, way of payment, payment guarantees Liability for breach(= risks and their legal treatment) Duration of contract for cco´s |
| Contract negotiation: Main pointd (2) What else determines outcome of negotiations? | Bargaining power of each party often determines the outcome of negotiations: Are alternatives available? Or is one of the parties under economic pressure to enter into the contract? |
| Contract formation | Parties sign/enter into/conclude a contract when in full agreement on its main contents Once concluded, contract binding upon a party---However, parties may change(alter,modify) signed contract or undo(annual/reverse) when parties agree such amendment/annulment |
| Contents of a contract | Under contract, claims/obligations of parties arise e.g. sales contract - seller must transfer possession &ownership in sold object to buyer - buyer must pay purchase price to seller - all as agreed in contract/as required under civil law of applicable jurisdication Next step = performance of contract |
| Cancellation of a contract | Basic rule: No unilateral withdrawal from/ rescission of/ cancellation of signed contract Exceptions: Party may unilateral withdraw IF one party made erroneous assumption e.g. about sales object---was deceived---faces a breach---requirements for such withdrawal satisfy in individual case |
| Termination of a contract | contract for continuing obligations (e.g. lease agreement, mid-term supply agreement) may be terminated by each party with no cause---by giving notice(e.g. 2 weeks or 6 months) ---if required for such a termination are satisfied in individual case --- --- |
| International law relating to trade and commerce (i) | Public International Law -conventions, treaties and accords among nations and rules of international organisations (govern int. trade) = Govermental regulation of international business EU treaties, NAFTA, WTO, OECD, UN agencies---Keywords: customs and tariff laws |
| International law relating to trade and commerce (ii) | International Business Law - Private Law applicable to international business transactions between private businesses (companies or individuals) -Keyword: International sales contract - This course focuses on international business law (mostly B2B) |
| International Business Law: 3 main areas | International trade = International sales International trademarks, patents Foreign direct investment |
| International trade | Contracts = Business law CISG Incoterms Overseas transportation International payment Arbitration |
| Intellectual property | Trademark and patent registration License contract |
| Foreign direct investment | International M&A transaction (optional) |
| "International" in IBL | Involving parties in at least 2 different countries= cross border transactions - transfer of ownership by physical delivery into another state OR -transfer of ownership to party located in another state without physical delivery e.g. acquisition of(i) real estate (ii) foods already located in buyer´s country (iii) finance products (iv) shares in a company (v) rights |
| Business in IBL Purchase (and delivery) of | Goods and assets Energy Construction work for infrastructure project Financial products or services Intellectual property rights Shares/ participation in companies (M&A) |
| Business in IBL: Parties | Typical of international business: b2b contracts, no direct sales to consumers But b2c or c2c contracts in some areas: - Luxury items - Purchases of consumer goods through internet sales platforms - Tourism |
| Law in IBL: Choice of law | Choice of law: Parties simply agree on the applicable law that applies to the sales contract---Thus the law governing the sales contract in many cases mostly - the law of a certain jurisdiction, that was agreed by parties in contract - and not some international law For issues not adressed in contract |
| Law in IBL: Private international law: General | Absence of a choice of law: Which law governs contract = law of which country - Every jurisdiction has rules governing this issues = the private international law or conflict of laws Choice of law clauses are business standard, normal case is: law of chosen jurisdiction applies to contract |
| Law in IBL: Private international law: Germany | EGBGB (Einführungsgesetz zum BGB) - contract validly concluded? Form. representation--- Ownership in an asset validly transferred to buyer? Rome | Regulation (EU) Contract for the sale of goods shall be governed by law of country where seller has his habitual residence |
| Law in IBL: Application of domestic law | But mandatory regulations of a country of origin and country of destination apply as well (domestic law) - DL of country of origin,e.g export bans,transport&storageregulations - DL of country of destination on tariff , import restiction, transport & storage, marketing & sales(permits etc.) |
| Law in IBL : Application of domestic law (2) Can it be circumvented? | Such mandatory regulations of domestic law cannot be circumvented by choice of law, nor is the application of mandatory regulations of DL a matter of private international law, because -choice of law and private international law only relate to private law governing the rights and dities between parties under sales contract - whereas mandatory regulations of DL of a country involved deal with public law duties of the parties to the public in general |
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