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LEGAL DICTIONARY

Commercial Law

What Is Commercial Law?

Commercial law is a broad area of rules and regulations governing merchants and other entities engaging in commerce. This group of laws provides a framework for protecting business interests, promoting fair competition, resolving disputes, and supporting economic growth.

Some of the concepts of commercial law overlap with international, federal, and state laws, as well as business laws.

What Are the Branches of Commercial Law?

There are numerous branches of commercial law, including contract, intellectual property, and consumer protection laws. Historically, commercial law is related to merchant-consumer relations or laws protecting the rights of consumers.

The primary branches of commercial law include the following:

  • Contract Law - These rules regulate the formation and enforcement of legal contracts. Contract law involves the elements of a valid contract and the legal actions a party may take if a breach of contract occurs.
  • Commercial Property Law - This commercial law governs the transactions related to different types of property. Although the law mainly deals with the sale, lease, transfer, or rental of immovable property, it also can cover the bailment of moveable property.
  • Business Regulations - This branch of commercial law covers government regulations for the organizational structure of business entities. These rules refer to incorporation, partnerships, and limited liability corporations (LLCs). They also apply to trade unions and other business organizations.
  • Tax Law - Tax law includes government taxes on income, sales, excise, gifts, capital gains, and profit distribution taxes.
  • Corporate Law - The formation, management, and termination of corporations are what comprise corporate law. It includes provisions for electing directors, raising capital, preventing insider trading, distributing dividends, redeeming shares, and handling mergers and acquisitions.
  • Intellectual Property Law - This law covers copyrights of creative work and patents of inventions.

The Uniform Commercial Code (UCC) is considered to be the backbone of commercial law in the U.S. Although it is not a federal law, every state and the District of Columbia has adopted this set of regulations, at least in part.

The UCC enables businesses to enter into interstate transaction contracts with the confidence that terms will be negotiated and enforced in the same way in every American jurisdiction. However, each state can change how it implements UCC provisions as it sees fit.

What Are Other Areas of Commercial Law?

Commercial law covers a wide area of governance. Other subsets or areas of commercial law include:

  • Merchant sales
  • Antitrust law
  • Environmental law
  • Corporate governance
  • International trade law
  • Labor law

Commercial law is not static because it interacts and intersects with various other areas of law. Disputes can involve issues such as consumer complaints, leaks of trade secrets, unfair trade practices, and marketing violations.

The typical remedies, which vary depending upon whether the parties involved are businesses or individuals, for commercial law disputes include:

  • Monetary compensation for losses
  • Cancellation of a contract
  • Injunction
  • Mediation
  • Reconciliation
  • Arbitration

Businesses must understand and comply with all aspects of commercial law to avoid legal ramifications and a loss of reputation in the marketplace.

Helpful Resources:

United States Department of State - Commercial Law

Cornell Law - Commercial Law

Uniform Law Commission - Uniform Commercial Code

What Is Commercial Law?

Commercial law is a broad area of rules and regulations governing merchants and other entities engaging in commerce. This group of laws provides a framework for protecting business interests, promoting fair competition, resolving disputes, and supporting economic growth.

Some of the concepts of commercial law overlap with international, federal, and state laws, as well as business laws.

What Are the Branches of Commercial Law?

There are numerous branches of commercial law, including contract, intellectual property, and consumer protection laws. Historically, commercial law is related to merchant-consumer relations or laws protecting the rights of consumers.

The primary branches of commercial law include the following:

  • Contract Law - These rules regulate the formation and enforcement of legal contracts. Contract law involves the elements of a valid contract and the legal actions a party may take if a breach of contract occurs.
  • Commercial Property Law - This commercial law governs the transactions related to different types of property. Although the law mainly deals with the sale, lease, transfer, or rental of immovable property, it also can cover the bailment of moveable property.
  • Business Regulations - This branch of commercial law covers government regulations for the organizational structure of business entities. These rules refer to incorporation, partnerships, and limited liability corporations (LLCs). They also apply to trade unions and other business organizations.
  • Tax Law - Tax law includes government taxes on income, sales, excise, gifts, capital gains, and profit distribution taxes.
  • Corporate Law - The formation, management, and termination of corporations are what comprise corporate law. It includes provisions for electing directors, raising capital, preventing insider trading, distributing dividends, redeeming shares, and handling mergers and acquisitions.
  • Intellectual Property Law - This law covers copyrights of creative work and patents of inventions.

The Uniform Commercial Code (UCC) is considered to be the backbone of commercial law in the U.S. Although it is not a federal law, every state and the District of Columbia has adopted this set of regulations, at least in part.

The UCC enables businesses to enter into interstate transaction contracts with the confidence that terms will be negotiated and enforced in the same way in every American jurisdiction. However, each state can change how it implements UCC provisions as it sees fit.

What Are Other Areas of Commercial Law?

Commercial law covers a wide area of governance. Other subsets or areas of commercial law include:

  • Merchant sales
  • Antitrust law
  • Environmental law
  • Corporate governance
  • International trade law
  • Labor law

Commercial law is not static because it interacts and intersects with various other areas of law. Disputes can involve issues such as consumer complaints, leaks of trade secrets, unfair trade practices, and marketing violations.

The typical remedies, which vary depending upon whether the parties involved are businesses or individuals, for commercial law disputes include:

  • Monetary compensation for losses
  • Cancellation of a contract
  • Injunction
  • Mediation
  • Reconciliation
  • Arbitration

Businesses must understand and comply with all aspects of commercial law to avoid legal ramifications and a loss of reputation in the marketplace.

Helpful Resources:

United States Department of State - Commercial Law

Cornell Law - Commercial Law

Uniform Law Commission - Uniform Commercial Code