United States Business Law: Everything You Need to Know
United States business laws are relevant to the legal needs of newly created business, as well as the needs of existing businesses.3 min read
United States business laws are relevant to the legal needs of newly created business, as well as the needs of existing businesses. This includes how the business interacts with other businesses, the public, its customers, and governing agencies. There are a variety of disciplines within the field of business law; some of these include tax law, intellectual property law, bankruptcy law, employment law, real estate law, etc.
Often, business law attorneys are hired for transactional work, and also to help a business avoid future litigation. When considering business law and its role within the legal system, it may be helpful to consider a business as a separate entity from the owners or employees. Businesses are subject to legal requirements in a similar way as individuals living together in society, and these rules are designed to give all participants a fair opportunity within the market.
Business formation involves the steps a new business must take to obey business laws. In this area, a common request for business law attorneys involves the preparation and filing of documentation surrounding the formation of a new entity. Some clients may need additional assistance, such as selecting the type of business entity that is the best fit for their company. There are quite a few types of business entities to choose from, and the appropriate type is dependent upon a variety of factors. The most common entity types include:
- Sole Proprietorship
- General Partnership
- Limited Partnership
- Limited Liability Partnership (LLP)
- Limited Liability Limited Partnership (LLLP)
- Nonprofit Corporation
- Limited Liability Company (LLC)
The purpose of most business entities, with the exception of a sole proprietorship or general partnership, is to shield the business owner from personal liability for incidents related to the business. A business law attorney can work with the business to achieve this goal by setting up and further customizing the business entity to meet the specific needs of the business.
Internal agreements are another responsibility a business law attorney may have during the formation of a new business. An internal agreement will need to be drafted in order to determine how the business will be managed. One example is an operating agreement for an LLC. An operating agreement governs how the profits and losses will be shared among the partners, how vital businesses decisions will be decided, and how ownership rights may be transferred. Due to the vital nature of this type of document, it must be drafted with extreme caution.
Navigating Complex Transactions
Some business owners may feel comfortable handling certain business transactions on their own. However, more complex transactions, such as internet commerce transactions or securities regulations, may be too complicated without an attorney. When businesses are part of a heavily regulated industry, they typically rely on in-house counsel or contract attorneys to provide assistance or advice regarding recent legal developments within their industry that may have an impact on their business. Generally, lawyers can provide valuable insight into these transactions due to their legal training and background, as well as their objective nature. Attorneys may be more likely to realize issues overlooked by the business owners, since the owners may be too emotionally invested.
Preemptive Measures to Avoid Litigation
Practicing attorneys in the field of business law are expected to be experts at constructing legal transactions that reduce a company's exposure to litigation. There are rules and regulations for businesses to follow before a dispute may occur, and by maneuvering these laws effectively, an attorney can greatly reduce business expenses. One example of these preemptive measures is an attorney who is hired to draft customer agreements. Including certain requirements in a customer agreement, such as requiring customers to follow specific procedures for disputes or only allowing disputes to be submitted in the company's home state, will increase the competitive advantage of the company.
Hiring Legal Counsel
An important part of launching a new business or operating an existing business is to hire legal counsel. Success in many areas of business may rely greatly on the company's ability to obtain proper legal advice. Business law attorneys are able to assist in a variety of areas, including purchase agreements, sales agreements, mergers, and acquisitions.
If you need help with United States business laws, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.