Legal framework of business


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  • Substantive law is the statutory or written law that defines rights and duties, such as crimes and punishments (in the criminal law), civil rights and responsibilities in civil law. It iscodified in legislated statutes or can be enacted through theinitiative process.Substantive law stands in contrast to procedural law, which is the "machinery" for enforcing those rights and duties. Procedural law comprises the rules by which a court hears and determines what happens in civil or criminal proceedings, as well as the method and means by which substantive law is made and administered.International law is the set of rules generally regarded and accepted as binding in relations between states and between nations.[1][2] It serves as a framework for the practice of stable and organized international relations.[3]International law differs from state-based legal systems in that it is primarily applicable to countries rather than to private citizens. Municipal law is the national, domestic, or internal law of a sovereign state defined in opposition to international law. Municipal law includes not only law at the national level, but law at the state, provincial, territorial, regional or local levels. While, as far as the law of the state is concerned, these may be distinct categories of law, international law is largely uninterested in this distinction and treats them all as one. Public international law concerns the structure and conduct of sovereign states; analogous entities, such as the Holy See; and intergovernmental organizations. To a lesser degree, international law also may affect multinational corporations and individuals, an impact increasingly evolving beyond domestic legal interpretation and enforcement. Public international law has increased in use and importance vastly over the twentieth century, due to the increase in global trade, environmental deterioration on a worldwide scale, awareness ofhuman rights violations, rapid and vast increases in international transportation and a boom in global communications.Conflict of laws (or private international law) is a set of procedural rules that determines which legal system and which jurisdiction apply to a given dispute. The rules typically apply when a legal dispute has a "foreign" element such as a contract agreed to by parties located in different countries, although the "foreign" element also exists in multi-jurisdictional countries such as the United Kingdom, the United States, Australia and Canada.
  • Legal framework of business

    1. 1. Legal framework of business
    2. 2. Learning outcome  Understand the meaning and nature of law  Understand the legal environment of business  Classification of law  Sources of Indian law  Employment law
    3. 3. DEFINITION OF LAW  THE BODY OF RULES WHETHER PROCEEDING FROM FORMAL ENACTMENT OR FROM CUSTOM ,WHICH A PARTICULAR STATE OR COMMUNITY RECOGNIZES AS BINDING ON ITS SUBJECTS OR MEMBERS  Important elements-  Law is a body of rules  Law is for guidance or conduct of persons –both human and artificial  Law is imposed  Law is enforced by the executive  The state  Content of law
    4. 4.  Two basic ideas of law- to maintain social order in a group  To compel members of the group to be within that order  Law is made to serve some purpose which may be social, economic or political  Law and morality
    5. 5. Classification of law  Public law vs. private law  Criminal law vs. civil law  Substantive vs procedural law  International law and municipal law  Public international law and private international law
    6. 6. Sources of indian law  Primary and secondary sources  Customary law  Judicial precedents are an important sources of law  Meaning of Ratio Decidendi  Meaning of Obiter Dicta
    7. 7. India-booming country  Largest democracy of the world ; population of 1.2 bn Growth rates 2010/2011: 7%; 2011/2012: 7%; 2012/13E: 7% Growth rates will exceed those of China Demographic trend: Average age: 25 years 25% of the world's population below 25 lives in India 50% of the population below 25 years 5.5% of the population above 65 years Third largest economy in the world in 2050 (today: 10th) Fifth largest consumer market in 2025 (today: 12th) Household income: dou
    8. 8.  Middle class grows by 1 million every month  Business language: English  Education is a key asset – IT / technology / Science play an important role  Foreign direct investment ("FDI") into India: USD 24bn in 2010/2011; USD 32 bn in 2011/2012 – the EU is India's largest trading partner  UNCTAD World Investment Report (2012): ranked no. 3 among preferred investment destinations for international companies
    9. 9.  M&A in India (2011): USD 26bn, - 43% compared to previous year – Outbound: USD 9.9 bn  Inbound: USD 9.99 bn  Domestic: USD 6.1 bn  Issues: increasing costs (HR cost: 10-15% p.a.), inflation  Slow pace in further liberalisation of economy  Corruption  Efficiency of administration and judiciary  Infrastructure Investing
    10. 10. India’s economy- the development since 1947  Command economy, largely following socialist principles including nationalization of companies, strict licensing etc. (1947-1990)  Start of economic liberalization and globalization of the Indian economy when forex reserves almost at nil (1991-2000)  Further liberalisation (since 2000)  2010: Consolidation of FDI Policy 2012: Important step: retail
    11. 11. Why india-the reasons to invest  India provides huge investment opportunities, including in the following sectors: Infrastructure: Power  Telecommunications  Roads  Ports  Civil Aviation & Airports  Petroleum & Natural Gas  Urban Infrastructure
    12. 12.  Services: Banking & Financial Services  Insurance  Real Estate & Construction  Retail  Tourism  􀀀 Manufacturing: 􀀀 Metals: Steel & Aluminium  􀀀 Textiles & Garments  􀀀 Electronics Hardware  􀀀 Chemicals  􀀀 Automobiles  􀀀 Auto Components  􀀀 Gems & Jewellery
    13. 13.  Manufacturing (cont.): Food & Agro Products  􀀀 Natural Resources: Coal  Metal Ores  Oil & Gas Exploration  􀀀 Knowledge Economy: Pharmaceuticals & Biotechnology  Healthcare  IT & IT-Enabled Services
    14. 14. Legal framework  Constitution  Incorporation and status of international and domestic law - Geneva conventions (1950) - Genocide conventions(1959) - CERD(1968) - ICCPR( 1979) - CONVENTION AGAINST TORTURE(1997)
    15. 15. A MODERN LEGAL FRAMEWORK  Intellectual Property: Paris Convention and TRIPS  Modern IP laws: Copyright Act, 1957  Patents Act, 1970  Trademarks Act, 1999  Designs Act, 2000  IP owners entitled to civil and criminal remedies  Employment Laws: Laws mainly regulate blue collar sector; white collar sector: contractual  Generally not as strong as European employment laws, but in particular PSUs have strong labour representation
    16. 16.  Competition Law Competition Act, 2002 replaces MRTP Act  Modern competition law; first decision issued by the Competition Commission of India  Provisions concerning anti-competitive agreements and abuse of dominant position in force  Merger control rules in force  Dispute Resolution Developed court system  But: long proceedings; therefore: arbitration
    17. 17.  Dispute Resolution (cont.) Arbitration in relation to India transactions: concerns of international businesses and arbitration experts  New proposals to reform the Indian arbitration framework  Careful drafting of arbitration clauses required