Law

Our legal category looks at the business codes of practice, laws and regulations that affect small and medium businesses to help you ensure your company meets all the necessary legal requirements for running a small enterprise.

Commercial Contracts: Governing Law and Jurisdiction

Commercial Contracts: Governing Law and Jurisdiction

When you enter into a contract, whether with someone inside or outside the UK, it’s advisable to set out: which country’s law will apply to it; which country’s courts will hear any disputes about it; and any procedures for dealing with disputes that the parties have agreed to use. You should therefore include in the contract the following types of clauses: a governing law clause specifying which legal system will apply to the interpretation of the agreement and its effect if a dispute arises; and a jurisdiction clause agreeing which country’s courts will have jurisdiction to hear disputes arising from the contract. Your Responsibilities It’s always advisable to state in a contract the law that will govern it and the courts that will have jurisdiction to hear d... »

Commercial Property Transactions and Your Business

Commercial Property Transactions and Your Business

Renting Choosing premises When selecting commercial premises, make sure there are no restrictions preventing you from carrying out your business. In particular, check the planning permissions, commercial classification (e.g. A1 for shops and A4 for pubs), restrictive covenants, and any use restrictions imposed by the landlord. License to Occupy vs Lease You can rent commercial premises through a lease or license. Some differences include: a lease allows the landlord to enter the property under restricted circumstances (eg. to do repairs) whereas with a license they can come and go freely with a license you may be sharing the property with other businesses licenses are for a shorter duration and easier to terminate License/lease Agreement When renting commercial (as opposed to residential) ... »

Which Terms & Conditions do You Use?

Which Terms & Conditions do You Use?

Businesses commonly trade and rely on their standard terms and conditions to protect them in the event of a contractual dispute. A business’ standard contracting procedure should undergo periodical review in order to ensure that such protection is reliably achieved. When was the last time your business reviewed its contracting process? In the recent case of Allen Fabrications Limited v ASD Limited(PDF), the High Court provided an update on the incorporation of standard terms into contracts between two parties. The case involved a claim for negligence and breach of contract due to ASD’s failure to comply with its obligations contained within the terms of its contract with Allen Fabrications. ASD’s standard terms and conditions limited ASD’s liability for breach of contract to the price of t... »

Complying with the UK Bribery Act – Practical Steps

Complying with the UK Bribery Act – Practical Steps

Many small businesses whose corporate hospitality has been at the heart of their customer service are now falling foul of ‘super compliance’ – put simply, their concerns about the UK Bribery Act mean they have removed all customer gifts or goodwill incentives. Whilst ensuring your staff are fully conversant with the Act is good business practice, it’s equally as important to know what you are still able to offer clients. Sensible promotional entertainment expenditure is not an offence under the Act but the Serious Fraud Office may take action against your organisation if any particular case of corporate expenditure appears to fall outside the bounds of reasonable and proportionate hospitality. You can help to protect your organisation through the following practical steps: 1. Issuing a cle... »

Using No-win, No-fee for Your Business

Using No-win, No-fee for Your Business

A recent YouGov survey conducted for John Kennedy Limited amongst small and medium-sized businesses (SMEs) found that over half (52%) of decision-makers were put off from pursuing a legal dispute by the cost. Yet 40% were unaware that Conditional Fee Agreements (CFAs), often called ‘no-win, no-fee’, were available to businesses. Unsurprisingly, law firms tend not to promote that they offer CFAs for fear of jeopardising their income streams from large commercial clients who pay them by the hour. However, there are reputable law firms out there prepared to act for SMEs on a risk-sharing ‘no-win, no-fee’ basis. Getting the right law firm to handle your dispute is crucial and yet this is where many businesses fall at the first hurdle. In my experience, SMEs will often t... »

Legal Basics for New Business Owners

Legal Basics for New Business Owners

When setting up a new business, it’s essential to familiarise yourself with the key relevant aspects of the law. Breaking the law through ignorance is no defence, and could result in hefty financial penalties or even imprisonment, so it pays to be informed. This guide gives an overview of the key areas you need to be aware of when running a business, such as: Your trading status Choosing a name for your business Leasing premises Data protection Advertising Refunds and returns Agreement and contracts Taking finance Intellectual property Employing staff Health and safety Business insurance Terms and conditions Working from home Insolvency Licences Environmental issues Your trading status You’ll need to decide whether you want to set up as a sole trader, partnership or limited company. To sta... »

Choosing and Protecting Your Business Name

Choosing and Protecting Your Business Name

When you set up in business, one of the first things you must do is choose a name. A well-chosen name can play a powerful part in building your business and contributing to its profile and success. This guide looks at: The legal aspects of naming your business and the main restrictions Choosing your name – what works and what doesn’t What your name says about you: size, image, branding Protecting your name The legal aspects of naming your business Legally speaking, names used by sole traders and unincorporated businesses are known as business names, while the names of incorporated limited businesses are referred to as company names. Although you won’t need to register it, your business name must comply with the Business Names Act of 1985. Company names must be registered at Companies House... »

The Bribery Act 2010 Guidance

The Bribery Act 2010 Guidance

The Bribery Act 2010 modernises the law on bribery. It came into force on the 1st of July 2011. This business advice article offers a quick guide to the things you need to know to prepare your business for implementation. The Government has also produced detailed guidance about the Act and the procedures that organisations can put in place to prevent bribery, as well as a set of illustrative case studies which you may find of further assistance (available here: www.justice.gov.uk/guidance/bribery.htm). Key points This Act deals only with bribery – not other forms of white collar crime Your organisation may be liable for failing to prevent a person from bribing on your behalf but only if that person performs services for you in business. It is very unlikely therefore that you will be liable... »

Franchising: Is Franchising the Answer?

Franchising: Is Franchising the Answer?

As a quintessence marketing tool, franchising connects successful growth with those that possess capital and business acumen to take the brand to the next level. Powerful data from the 2010 NatWest/BFA Franchise Survey reveals that the UK franchising industry stands at a significant £11.8 billion. Notwithstanding harsh economic conditions, UK franchise businesses continue to expand with 842 franchise systems identified, mean average turnover of £353,000 and average opening cost of £46,700. Yet, what leads to the durability of a franchise or the certainty of a successful concern? Perhaps, why so many new businesses fail is that they simply run out of capital before they reach profitability and attain a positive cash flow. A franchisor will learn through error and omission, and en-route gain... »

Your Business on Divorce/Dissolution

Your Business on Divorce/Dissolution

Business assets On the breakdown of a relationship, any business owned jointly, solely or contains an interest, will need to be valued and perhaps, need to be restructured to effect any settlement. Settlements now centre on contributions to the business and homemaking during the marriage or civil partnership, with both regarded as of equal merit. It is important to understand the nature of your business and how it operates. Full and frank financial disclosure is required including examination of up to five sets of audited accounts and up to date management accounts, if they exist. Since the landmark decision of White v White (2000), where there are more than sufficient assets to meet the needs of the parties, as a starting point the court must consider a 50:50 division as a measure of equi... »

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