The Legal Environment
The term Legal Environment is derived from the political climate of a country and it has various dimensions such as the domestic laws of the country and the domestic laws of the foreign markets of a country and the international laws of business. The study of the Legal environment begins with the nature of law and the legal system of a country. This may vary from country to country and the legal environment is highly influenced by the requirements of the business community, the market, government and the consumers of the business.
Legal Systems can be classified into three major divisions. They are substantive and procedural law, civil and criminal law, and public and private law. Each country has its own system of laws. Civil law is the most extensive system and is followed by most of the countries. It regulates the rights and duties between parties. Criminal law concerns itself on threatening behaviors, which society outlaws completely. Substantive law serves for the rights of the people and procedural law involves the processes for settling disputes. Public law refers to the rights and duties of government since they deal with the citizens of a nation. Private law controls and regulates the duties between individuals.
Contract Law is the base of all the commercial activities of the legal environment of business. A true law of contract implies the development of the economy. The purpose of the contract law is to mainly focus on ensuring the rights and obligations of both of the parties of an agreement in which they have entered. In this way the possibilities of misunderstandings of the agreement and disputes are reduced. In the complex international business environment the Legal Contract Law plays a vital role to avoid risks and complexities. Law of contract may vary from country to country. For example, when an international business problem in a contract occurs, the problem is settled in one of the countries involved in the contract, according to the laws and the regulations of the country.
International Law consists of laws and regulations that regulate different nations and their relationships throughout the world. Public International Law focuses on the relationship between different countries or the inter-relationships of people of different countries. Private International Law deals with civil or human right issues between countries all over the world. International Law helps the buyers and sellers in business environment to regulate relationship between countries or the people of the country. Treaties and conventions are the principle sources International Law. There is no organized body to create the International Law and to enforce the International Law. But there is the International Court in Netherlands which deals with the problems that is suitable for submission to it and for adjudication.
As a general rule, we always depend upon the law to provide us a peaceful nation, a stable economy, a fair society and a safe place to live and work. This is the common thought for all the individuals irrespective of position and place in the society. Law becomes vital for crafting the society and in a democracy it is the people who help build laws. Legal rules control us, yet it is ‘we’ who create them. A good knowledge of the law can help build a successful nation.