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LEGAL ASPECTS OF BUSINESS
Hindustan Unilever Limited (HUL)
PROGRAM OUTCOME
• 1. Generic and Domain Knowledge -
Ability to articulate, illustrate, analyze, synthesize and apply the knowledge
of principles and frameworks of management and allied domains to the
solutions of real-world complex business issues
• 2. Problem Solving & Innovation - Ability to Identify, formulate and provide
innovative solution frameworks to real world complex business and social
and legal problems by systematically applying modern quantitative
and qualitative problem solving tools and techniques.
• 3. Critical Thinking - Ability to conduct investigation of multidimensional
business problems using research based knowledge and legal methods to
arrive at data driven decisions
• 4.Effective Communication - Ability to effectively communicate in cross-
culturalbsettings, in technology mediated
environments, especially in the business context and with society at large.
•
PROGRAM OUTCOME(Conti..)
• 5. Leadership and Team Work - Ability to collaborate in an organizational context and
across organizational boundaries and lead themselves and others in the achievement
of organizational goals and optimize outcomes for all stakeholders.
• 6. Global Orientation and Cross-Cultural Appreciation: Ability to approach any
relevant business issues from a global perspective and exhibit an appreciation of
Cross Cultural aspects of business and management.
• 7. Environment and Sustainability - Ability to demonstrate knowledge of and need for
sustainable development and assess the impact of managerial decisions and
business priorities on the societal, economic and environmental aspects.
• 8. Social Responsiveness and Ethics -
Ability to exhibit a broad appreciation of the ethical and value underpinnings of
managerial choices in a political, cross-cultural, globalized, digitized, socio-economic
environment and
distinguish between ethical and unethical behaviors & act with integrity.
• 9. LifeLong Learning :
• Ability to operate independently in new environment, acquire new knowledge and skil
ls and assimilate them into the internalized knowledge and skills.
COURSE OUTCOME
• Remembering- Define concepts in legal aspects of business and steps
involved in writing a case .
• Understanding- Explain the role of legal aspects of business in developing
legal knowledge for academic learning.
• Applying- Practical implementation with the cases of the real business
world based on some legal cases for identification and learning the best
practices in legal aspects.
• Analyzing- Analyze various data sources for writing a case based on legal
aspects.
• Evaluating- Organizing and analysing the data pertaining to the topic
selected for writing a case based on legal aspects.
• Creating- Formulate a structured case for the purpose of academic
study/research publication.
INTRODUCTION
 Hindustan Unilever Limited (HUL) is India's largest consumer goods company based
in Mumbai, Maharashtra.
 It is owned by the British-Dutch company Unilever which controls 52% majority stake
in HUL.
 Its products include foods, beverages, cleaning agents and personal care
products.
 It is headquartered in Mumbai, India and has an employee strength of over 16,500
employees and contributes to indirect employment of over 65,000 people.
 Hindustan Unilever's distribution covers over 2 million retail outlets across India directly
and its products are available in over 6.4 million outlets in the country.
 As per Nielsen market research data, two out of three Indians use HUL products
OUR VISION
 We work to create a better future every day
 We help people feel good, look good and get more out of
life with brands and services that are good for them and
good for others.
 We will inspire people to take small everyday actions
that can add up to a big difference for the world.
NEW BABY FOOD PRODUCT (HUL)
THE LEGAL SYSTEM IN INDIA AND CONTRACT LAW
• In the event that a company is seeking to export and distribute goods to
India, any contract for sale and export would be governed by The Sale of
Goods Act, 1930 (“Goods Act”) and the general principles of The Indian
Contract Act, 1872 (“Contract Act”). These Acts are predominantly based
on principles of English Law. Any export of goods to India is a contract of
sale of goods whereby the seller transfers or agrees to transfer the
ownership of the goods to the buyer for a price. Under the Goods Act, a
distinction is made between ‘Sale’ and ‘Agreement to Sell’. In a ‘Sale’, the
property is transferred from the seller to the buyer forthwith. In an
‘Agreement to Sell’, the transfer is to take place at a future time or subject
to certain conditions to be fulfilled. An ‘Agreement to Sell’ becomes a
‘Sale’ when the stipulated time elapses or the conditions subject to which
the property is to be transferred are fulfilled.
The contracts most commonly used by foreign companies which
do business in India are:
• PURCHASE OF GOODS CONTRACT: for companies (especially SMEs) which purchase and
import products from India. The contract is written from the perspective of the foreign company
that buys products in India.
• SALE OF GOODS CONTRACT: for the exportation of goods engaged in by foreign companies
with India, usually industrial supplies, machinery or consumer products. The model contract is
written from the perspective of the foreign company that sells products in India.
• MANUFACTURING CONTRACT: for foreign companies subcontracting their manufacturing in
India and need that the manufactured products comply with certain technical and commercial
requirements, and also that the Indian manufacturer complies with the confidentiality and
intellectual property rights of the foreign company.
• DISTRIBUTION CONTRACT: when the foreign company appoints an Indian company to distribute
its products in all or part of the territory of India. The Indian distributor resells the products to
manufacturing companies (if they are industrial supplies) or to retailers (if they are consumer
products).
The contracts most commonly used by foreign companies which do
business in India are:
• AGENCY AGREEMENT: the foreign company appoints a natural person or a legal
entity to seek clients and carry out transactions, normally in a certain State of India or
for the whole country. The agent receives its fees through commissions on the sales it
achieves.
• SALES REPRESENTATIVE AGREEMENT: similar to the Agency Contract, although
the representative can negotiate the sale conditions of the products with the Indian
company, always in accordance with the instructions and clauses indicated by the
foreign company.
• JOINT VENTURE AGREEMENT: for the establishment of a new company between
two partners (a foreign company and an Indian company) who have agreed to share
the profits and risks of a business carried on by both of them.
• CONFIDENTIALITY (OR NON-DISCLOSURE) AGREEMENT: is used in preliminary
negotiations before distribution, licensing, or joint venture agreements between
foreign companies and Indian companies to safeguard the sensitive information
(commercial or technical) which is supplied to the other party during negotiations.
RULES BY THE INDIAN CONRACT
ACT 1872
• Registration
• Contract section 2(h)
• Valid contract
• Illegal contract
• Offer section 2(a)
Licensing/ Registration Under Food Safety And Standard Act:
• The food safety and standard authority of India (FSSAI) has been established under
food safety and standard act, 2006 consolidate various acts and orders that have
hitherto handle food related issues in various ministries and departments. FSSAI has
been created for laying down science based standards for articles of food and to
regulate their manufacture, storage, distribution, sale, and import to ensure
availability of safe and wholesome food for infant consumption. Under this Food
Safety and standards act, 2006, various central acts like prevention of Food
Adulteration Act, 1954, Fruit Products Order, 1955, Milk and Milk products Order,
1992, etc will be repealed after commencement of FSS Act, 2006. The act also aims
to establish a single reference point for all matters relating to food safety and
standards, by moving from multi-level, multi departmental control to a single line of
command. To this effect, the act establishes an independent statutory authority- the
Food Safety and Standard Authority of India with head office at Delhi. Food Safety
and Standards Authority of India (FSSAI) and the state food safety authorities shall
enforce various provisions of the Act. FSSAI has been mandated with the following
key objectives with reference to Registration and Licensing of Food Business
Operators.
FSSAI Product Approval:
fssai
• Business Entity Incorporation:
• FSSAI product approval is an intangible asset for any business, as it
provides the business with authority to manufacture or market a certain type
of food product in India. Further, each FSSAI product approval is granted
only after considerable amount of processing time and involves payment of
high processing fees to FSSAI. Therefore, it is recommended that the
FSSAI product approval application be made from a corporate entity
like Private Limited Company or LLP, so that business can be easily
transferred at a later time along with the food product licenses, if required.
• Food Business Operator License:
A food business operator license is required for businesses that are
involved in the manufacturing or handling or selling of food products. While
applying for food product approval, a copy of the FSSAI food business
operator license certificate must be submitted. Hence, it is recommended
that a food business operator license be obtained in the name of the
business.
fssai
• Test Reports:
• The application for food product approval must be submitted along
with certain test reports from NABL accredited labs. The NABL lab
reports are used to validate the claims, label claims, ingredients and
other parameters of the food product. The type of tests to be
conducted for the food product will vary based on the nature of the
product.
• Food Product Label:
• The FSSAI food product approval application must contain a label of
the product. The label can be a prototype and need not be printed. It
is important to ensure that the food product label conforms to the
FSSAI Food Product Labeling Standards in India.
JOHNSON & JOHNSON AND ITS BABY
POWDER PROBLEM
ABSTRACT
In 2016, Johnson & Johnson (J&J), a leading multinational medical devices,
pharmaceutical, and consumer packaged goods manufacturer, was faced with
about 1,200 lawsuits related to its talcum powder products – Johnson’s Baby
Powder and Shower-to-Shower body powder. Johnson’s Baby powder was an
iconic brand, which J&J had been promoting to adults, particularly women. For a
long time, talcum powder when used for feminine hygiene, had been linked to
ovarian cancer. The lawsuits alleged that J&J had known about this association but
had failed to inform its customers about it. Alex Gorsky (Gorsky) , Chairman &
CEO of J&J, had also been toeing the management’s line that the criticism of its
talcum powder was inconsistent with a hundred years of experience with the
product. Analysts were concerned whether J&J, which had faced a number of
product-related crises, would be able to maintain its reputation as a trusted family
company in a climate of mounting lawsuits. Can J&J afford to jeopardize the whole
J&J brand while trying to protect its talcum powder? .
CASE ISSUES
ISSUES
 Understand safety-related issues and challenges in product labeling.
 Understand the issues and challenges in crisis management.
 Analyze the issues and challenges arising out of J&J’s marketing of its
baby powder brand in light of the product’s association with ovarian
cancer.
 Determine a company’s responsibility toward its customers.
 Explore ways in which J&J could maintain its brand image and
reputation as a trusted family company.
EXCERPTS
TALCUM POWDER: A HUMAN CARCINOGEN?(usage)
Talcum powder had been widely used in cosmetic products, including adult body
and facial powders. Talc, a mineral, consisted of magnesium, silicon, and oxygen.
Talcum powder was used to keep skin dry and as protection against rashes.
TALCUM POWDER LAWSUITS
In 2009, J&J became the subject of the talcum powder lawsuit, one of the largest
consumer advocacy litigations in history. The lawsuit was filed by Diane Berg
(Berg), a woman from Sioux Falls, South Dakota. Berg, a physician’s assistant by
profession, was diagnosed with ovarian cancer in 2006 when she was just 49
years old. According to her, she had no idea that the Johnson’s products that she
had been using since childhood could be so dangerous. There was no warning on
the labels about any possible cancer risk coming from long-term exposure.
(The consumer protection act 1986, The sale of goods act 1930)
EXCERPTS
THE CONSEQUENCES
In February 2016, the jury in St. Louis, Missouri awarded US$72 million to the
family of an Alabama woman named Jacqueline Fox, who died of ovarian cancer
after having used baby powder for decades as a feminine hygiene product. Three
months later, in May 2016, another jury in St. Louis, Missouri, awarded US $55
million to a woman from South Dakota, who was diagnosed with ovarian cancer
after using Johnson’s Baby Powder for nearly 40 years.
J&J’S RESPONSE
The successful lawsuits and the jury’s verdict added to the ongoing debate about
the safety of talc-based cosmetic products. Despite losses, J&J maintained that its
products were safe. According to Tara Glasgow, the research and development
lead for the company’s baby products franchise worldwide...
THANK YOU
PRESENTED BY:-
 ANIMESH MODI
 AMAN SINGH
 SHUBHAM KUMAR DUBEY
 RAJAT ARORA
 APOORVA VINIT SHUKLA
 RIYA KUMARI

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Legal aspects of business

  • 1. LEGAL ASPECTS OF BUSINESS Hindustan Unilever Limited (HUL)
  • 2. PROGRAM OUTCOME • 1. Generic and Domain Knowledge - Ability to articulate, illustrate, analyze, synthesize and apply the knowledge of principles and frameworks of management and allied domains to the solutions of real-world complex business issues • 2. Problem Solving & Innovation - Ability to Identify, formulate and provide innovative solution frameworks to real world complex business and social and legal problems by systematically applying modern quantitative and qualitative problem solving tools and techniques. • 3. Critical Thinking - Ability to conduct investigation of multidimensional business problems using research based knowledge and legal methods to arrive at data driven decisions • 4.Effective Communication - Ability to effectively communicate in cross- culturalbsettings, in technology mediated environments, especially in the business context and with society at large. •
  • 3. PROGRAM OUTCOME(Conti..) • 5. Leadership and Team Work - Ability to collaborate in an organizational context and across organizational boundaries and lead themselves and others in the achievement of organizational goals and optimize outcomes for all stakeholders. • 6. Global Orientation and Cross-Cultural Appreciation: Ability to approach any relevant business issues from a global perspective and exhibit an appreciation of Cross Cultural aspects of business and management. • 7. Environment and Sustainability - Ability to demonstrate knowledge of and need for sustainable development and assess the impact of managerial decisions and business priorities on the societal, economic and environmental aspects. • 8. Social Responsiveness and Ethics - Ability to exhibit a broad appreciation of the ethical and value underpinnings of managerial choices in a political, cross-cultural, globalized, digitized, socio-economic environment and distinguish between ethical and unethical behaviors & act with integrity. • 9. LifeLong Learning : • Ability to operate independently in new environment, acquire new knowledge and skil ls and assimilate them into the internalized knowledge and skills.
  • 4. COURSE OUTCOME • Remembering- Define concepts in legal aspects of business and steps involved in writing a case . • Understanding- Explain the role of legal aspects of business in developing legal knowledge for academic learning. • Applying- Practical implementation with the cases of the real business world based on some legal cases for identification and learning the best practices in legal aspects. • Analyzing- Analyze various data sources for writing a case based on legal aspects. • Evaluating- Organizing and analysing the data pertaining to the topic selected for writing a case based on legal aspects. • Creating- Formulate a structured case for the purpose of academic study/research publication.
  • 5. INTRODUCTION  Hindustan Unilever Limited (HUL) is India's largest consumer goods company based in Mumbai, Maharashtra.  It is owned by the British-Dutch company Unilever which controls 52% majority stake in HUL.  Its products include foods, beverages, cleaning agents and personal care products.  It is headquartered in Mumbai, India and has an employee strength of over 16,500 employees and contributes to indirect employment of over 65,000 people.  Hindustan Unilever's distribution covers over 2 million retail outlets across India directly and its products are available in over 6.4 million outlets in the country.  As per Nielsen market research data, two out of three Indians use HUL products
  • 6. OUR VISION  We work to create a better future every day  We help people feel good, look good and get more out of life with brands and services that are good for them and good for others.  We will inspire people to take small everyday actions that can add up to a big difference for the world.
  • 7. NEW BABY FOOD PRODUCT (HUL)
  • 8. THE LEGAL SYSTEM IN INDIA AND CONTRACT LAW • In the event that a company is seeking to export and distribute goods to India, any contract for sale and export would be governed by The Sale of Goods Act, 1930 (“Goods Act”) and the general principles of The Indian Contract Act, 1872 (“Contract Act”). These Acts are predominantly based on principles of English Law. Any export of goods to India is a contract of sale of goods whereby the seller transfers or agrees to transfer the ownership of the goods to the buyer for a price. Under the Goods Act, a distinction is made between ‘Sale’ and ‘Agreement to Sell’. In a ‘Sale’, the property is transferred from the seller to the buyer forthwith. In an ‘Agreement to Sell’, the transfer is to take place at a future time or subject to certain conditions to be fulfilled. An ‘Agreement to Sell’ becomes a ‘Sale’ when the stipulated time elapses or the conditions subject to which the property is to be transferred are fulfilled.
  • 9. The contracts most commonly used by foreign companies which do business in India are: • PURCHASE OF GOODS CONTRACT: for companies (especially SMEs) which purchase and import products from India. The contract is written from the perspective of the foreign company that buys products in India. • SALE OF GOODS CONTRACT: for the exportation of goods engaged in by foreign companies with India, usually industrial supplies, machinery or consumer products. The model contract is written from the perspective of the foreign company that sells products in India. • MANUFACTURING CONTRACT: for foreign companies subcontracting their manufacturing in India and need that the manufactured products comply with certain technical and commercial requirements, and also that the Indian manufacturer complies with the confidentiality and intellectual property rights of the foreign company. • DISTRIBUTION CONTRACT: when the foreign company appoints an Indian company to distribute its products in all or part of the territory of India. The Indian distributor resells the products to manufacturing companies (if they are industrial supplies) or to retailers (if they are consumer products).
  • 10. The contracts most commonly used by foreign companies which do business in India are: • AGENCY AGREEMENT: the foreign company appoints a natural person or a legal entity to seek clients and carry out transactions, normally in a certain State of India or for the whole country. The agent receives its fees through commissions on the sales it achieves. • SALES REPRESENTATIVE AGREEMENT: similar to the Agency Contract, although the representative can negotiate the sale conditions of the products with the Indian company, always in accordance with the instructions and clauses indicated by the foreign company. • JOINT VENTURE AGREEMENT: for the establishment of a new company between two partners (a foreign company and an Indian company) who have agreed to share the profits and risks of a business carried on by both of them. • CONFIDENTIALITY (OR NON-DISCLOSURE) AGREEMENT: is used in preliminary negotiations before distribution, licensing, or joint venture agreements between foreign companies and Indian companies to safeguard the sensitive information (commercial or technical) which is supplied to the other party during negotiations.
  • 11. RULES BY THE INDIAN CONRACT ACT 1872 • Registration • Contract section 2(h) • Valid contract • Illegal contract • Offer section 2(a)
  • 12. Licensing/ Registration Under Food Safety And Standard Act: • The food safety and standard authority of India (FSSAI) has been established under food safety and standard act, 2006 consolidate various acts and orders that have hitherto handle food related issues in various ministries and departments. FSSAI has been created for laying down science based standards for articles of food and to regulate their manufacture, storage, distribution, sale, and import to ensure availability of safe and wholesome food for infant consumption. Under this Food Safety and standards act, 2006, various central acts like prevention of Food Adulteration Act, 1954, Fruit Products Order, 1955, Milk and Milk products Order, 1992, etc will be repealed after commencement of FSS Act, 2006. The act also aims to establish a single reference point for all matters relating to food safety and standards, by moving from multi-level, multi departmental control to a single line of command. To this effect, the act establishes an independent statutory authority- the Food Safety and Standard Authority of India with head office at Delhi. Food Safety and Standards Authority of India (FSSAI) and the state food safety authorities shall enforce various provisions of the Act. FSSAI has been mandated with the following key objectives with reference to Registration and Licensing of Food Business Operators.
  • 14. fssai • Business Entity Incorporation: • FSSAI product approval is an intangible asset for any business, as it provides the business with authority to manufacture or market a certain type of food product in India. Further, each FSSAI product approval is granted only after considerable amount of processing time and involves payment of high processing fees to FSSAI. Therefore, it is recommended that the FSSAI product approval application be made from a corporate entity like Private Limited Company or LLP, so that business can be easily transferred at a later time along with the food product licenses, if required. • Food Business Operator License: A food business operator license is required for businesses that are involved in the manufacturing or handling or selling of food products. While applying for food product approval, a copy of the FSSAI food business operator license certificate must be submitted. Hence, it is recommended that a food business operator license be obtained in the name of the business.
  • 15. fssai • Test Reports: • The application for food product approval must be submitted along with certain test reports from NABL accredited labs. The NABL lab reports are used to validate the claims, label claims, ingredients and other parameters of the food product. The type of tests to be conducted for the food product will vary based on the nature of the product. • Food Product Label: • The FSSAI food product approval application must contain a label of the product. The label can be a prototype and need not be printed. It is important to ensure that the food product label conforms to the FSSAI Food Product Labeling Standards in India.
  • 16. JOHNSON & JOHNSON AND ITS BABY POWDER PROBLEM ABSTRACT In 2016, Johnson & Johnson (J&J), a leading multinational medical devices, pharmaceutical, and consumer packaged goods manufacturer, was faced with about 1,200 lawsuits related to its talcum powder products – Johnson’s Baby Powder and Shower-to-Shower body powder. Johnson’s Baby powder was an iconic brand, which J&J had been promoting to adults, particularly women. For a long time, talcum powder when used for feminine hygiene, had been linked to ovarian cancer. The lawsuits alleged that J&J had known about this association but had failed to inform its customers about it. Alex Gorsky (Gorsky) , Chairman & CEO of J&J, had also been toeing the management’s line that the criticism of its talcum powder was inconsistent with a hundred years of experience with the product. Analysts were concerned whether J&J, which had faced a number of product-related crises, would be able to maintain its reputation as a trusted family company in a climate of mounting lawsuits. Can J&J afford to jeopardize the whole J&J brand while trying to protect its talcum powder? .
  • 17. CASE ISSUES ISSUES  Understand safety-related issues and challenges in product labeling.  Understand the issues and challenges in crisis management.  Analyze the issues and challenges arising out of J&J’s marketing of its baby powder brand in light of the product’s association with ovarian cancer.  Determine a company’s responsibility toward its customers.  Explore ways in which J&J could maintain its brand image and reputation as a trusted family company.
  • 18. EXCERPTS TALCUM POWDER: A HUMAN CARCINOGEN?(usage) Talcum powder had been widely used in cosmetic products, including adult body and facial powders. Talc, a mineral, consisted of magnesium, silicon, and oxygen. Talcum powder was used to keep skin dry and as protection against rashes. TALCUM POWDER LAWSUITS In 2009, J&J became the subject of the talcum powder lawsuit, one of the largest consumer advocacy litigations in history. The lawsuit was filed by Diane Berg (Berg), a woman from Sioux Falls, South Dakota. Berg, a physician’s assistant by profession, was diagnosed with ovarian cancer in 2006 when she was just 49 years old. According to her, she had no idea that the Johnson’s products that she had been using since childhood could be so dangerous. There was no warning on the labels about any possible cancer risk coming from long-term exposure. (The consumer protection act 1986, The sale of goods act 1930)
  • 19. EXCERPTS THE CONSEQUENCES In February 2016, the jury in St. Louis, Missouri awarded US$72 million to the family of an Alabama woman named Jacqueline Fox, who died of ovarian cancer after having used baby powder for decades as a feminine hygiene product. Three months later, in May 2016, another jury in St. Louis, Missouri, awarded US $55 million to a woman from South Dakota, who was diagnosed with ovarian cancer after using Johnson’s Baby Powder for nearly 40 years. J&J’S RESPONSE The successful lawsuits and the jury’s verdict added to the ongoing debate about the safety of talc-based cosmetic products. Despite losses, J&J maintained that its products were safe. According to Tara Glasgow, the research and development lead for the company’s baby products franchise worldwide...
  • 20. THANK YOU PRESENTED BY:-  ANIMESH MODI  AMAN SINGH  SHUBHAM KUMAR DUBEY  RAJAT ARORA  APOORVA VINIT SHUKLA  RIYA KUMARI