What is Corporate Law?

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Corporate law refers to the body of laws, rules, and regulations which govern the organization and all operations of corporations. It is a branch of law that deals with corporations rather than individuals. A corporation is a group of people being organized under corporate law and granted legal personality to conduct businesses. Thus, in corporate law, a corporation is seen as a single legal entity. 

Corporate laws involve certain legal matters such as the process of incorporation or the requirements in the formation of a corporation, securities, which include stocks, investments, and shareholder agreements, rights and liabilities of the members, dispute settlement with other corporations, and the termination of a corporation.

Corporate laws are under civil and not criminal law wherein the disputes will be settled through civil remedies. Corporate laws are usually favorable to corporations because it helps them to do business easier and fair with others.    

The following are the important rights that corporate law grants to corporations:

  • Legal Personality – the group of owners in a corporation can share their resources and make them into a single entity. 
  • Investor Ownership – owners or investors have a portion of the corporation’s profits but the management of the corporation will be run by a board that is usually elected. 
  • Limited Liability – when a corporation is being legally sued, corporate assets are only at risk and not the personal assets of the owners.  
  • Delegated Management – the shareholders should elect a board that will be responsible to assign officers who will be in charge of the daily operation of the corporation. 
  • Transferable Shares – even though one of the owners would want to withdraw his share, the corporation can continue to operate because ownership can be transferred to another.  

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Pieter Borremans

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