Legal Environment of Business

Submitted to: Presented by:

Dr. Sundeep Kumar Sumit Singh Rathore
Prerna
Sudhanshu Pareek
Amarjeet Kumar
Shrlabh Kori
Roshni Vishwakarma
Prateeksha Chaturvedi
Anjali Jain
Aashi Singh
Avinash Sharma
Pankaj Chhapera
 INTRODUCTION
1.Framework of laws, regulations and legal principles

2.Understanding the legal environment is crucial for businesses

3.Impacts on business operations

4.It has dynamic nature

5.Adaptation to its dynamic nature.

Different Types Of Legal Environment
● Legal Environment:
It includes various laws passed by the government,
administrative orders issued by government authorities, court
judgements as well as decisions rendered by the central, state or
local governments.
● Political Environment:
It means that the actions were taken by the government, which
potentially affect the routine activities of any business or
company on a domestic or at the global level.
The success of business and industry depends upon the
government’s attitude towards the business and industry.
Different Types Of Legal Environment
● Economic Environment:
The economic environment consists of an economic system, economic
policies and economic conditions prevailing in a country.
● Social Environment:
It consists of social forces like traditions, values, social trends, level of
education, the standard of living etc. All these forces have a vast impact
on business.
● Technological Environment:
It consists of scientific improvements and innovations which provide
new ways of producing goods, rendering services, new methods and
techniques to operate business.
Different Aspect Of Legal Environment
There are various types of legal environments with their own sets of rules,
regulations, and laws that the business has to follow to exist in society.

I. Indian Contract Act 1872 II. Sale of Goods Act 1930 III. Indian Partnership
Enacted 1872, guides contracts. Governs goods sale. Act 1932
Features: Core features: Regulates partnerships.
1. At least two parties. 1. At least two parties. Key points:
2. Offer and acceptance. 2. Monetary consideration. 1. At least two persons.
3. Lawful consideration. 3. Agreement to sell. 2. Oral or written.
4. Free consent. 4. Movable property. 3. Profit sharing.
5. Lawful intent. 5. Transfer of property. 4. Unlimited liability.
IV. Negotiable Instrument V. Companies Act 2013
Act 1881 Governs companies.
Governs negotiable Core features:
instruments. 1. Limited liability.
Core features: 2. Separation of ownership and
1. Freely transferable. management.
2. Written document. 3. Independent legal entity.
3. Acts as money. 4. Perpetual existence.
4. No consent needed. 5. Transferability of shares.
VI.Consumer Protection Act 1986
Enacted 1986 and was also reframed
in the year 2019., Safe Gaurd
Consumer
Features:
1. safeguard the rights of
consumers and provide remedies
2. empowers consumers to seek
compensation, replacement, or
refund
3. establishes consumer forums
4. The Act applies to goods and
services.
VII.Monopolies and Restrictive
Trade Practices Act 1969
Governs Monopolistic Market.
Core features:
1. To control the monopolies.
2. To prohibit unfair trade
practices.
3. The prohibition of
monopolistic trade practices.
4. And the prohibition of
restrictive trade practices.
VIII.Competition Act 2002 IX.Environmental Protection Act
Features: 1986
1. To reduce the adverse impact on
Core features:
the competition in the market.
1. To safeguard the environment
2. To maintain healthy competition in
in various aspects..
the market.
2. Establishes regulatory
3. To reduce the domination of the
framework
large players in the market.
4. To maintain the freedom of trade 3. prevent, control, and mitigate
for everyone in the market. environmental harm caused
5. To protect the interest of the 4. Provides guidelines
consumer by providing them with 5. Empowers authorities
good quality products in services
and quality information.
IX.Environmental Protection Act 1986
I. Air (Prevention and
Control of Pollution)
Act 1981
•The aim of this Act is to
reduce air pollution and
improve ambient air quality
standards. The establishment
of any industrial plant in any
area requires the permission
of state pollution control
boards(SPCB).
II. •Water (Prevention
and Control of Pollution) III. •National green
tribunal act 2010
Act 1974
•Under this Act, laws are •This Act relates to the
made to prevent and laws regarding the
control water pollution. settlement of the
Under this Act, various National Green
rules and regulations are Tribunal, which helps in
made to prohibit industries environmental
and manufacturing units protection, forest
from discharging pollutants conservation, and other
into the water bodies. natural resources.
.
Characteristics Of A Legal Environment Of
Business
Dynamic Nature

Inter Relatedness Uncertainty

Relativity Complexity
Court System In India In Business Context
Dispute Resolution: Regulatory Consumer
Courts can Compliance:
Protection:
adjudicate Businesses operate
within a complex Court judgments can
contractual breaches,
intellectual property framework of laws set precedents for
infringements, and regulations consumer rights,
consumer Court rulings can impacting how
complaints, clarify regulatory businesses interact
regulatory violations, ambiguities and with their customers.
and various other provide guidance for
commercial matters. businesses.
Court System In India In Business Context
Challenges and
Intellectual Contractual
Opportunities:
Property Enforcement:
Protection: court system enforces Backlog of Cases:
contractual obligations, Complexity of Laws:
court system
ensuring businesses can Evolving Legal
safeguards
rely on agreements and Landscape:
intellectual property
hold other parties legal complexities crucial
rights, such as
accountable.This helps for fostering a more
patents, trademarks,
businesses mitigate
and copyrights, efficient and business-
risks and protect their
which are essential friendly legal system.
investments.
for many businesses.
Importance of precedent
Also known as stand by decisions: To plays a crucial role in ensuring a
stable, predictable, and fair legal system.
Consistency and Certainty: When courts follow previous rulings, it
creates a more predictable legal environment. This predictability fosters
trust in the legal system and encourages economic activity.
Equality and Fairness: By treating similar cases similarly, precedent
promotes equality and fairness before the law. Individuals in comparable
situations can expect consistent outcomes.
Importance of precedent
Development of Law: It also allows for the evolution of law over time. Courts
can distinguish existing precedents from new cases with unique nuances,
gradually refining and adapting the law to new circumstances and societal needs.
Efficiency and Legitimacy: Following precedent saves time and resources for
both the courts and litigants. Judges don't need to re-argue established legal
principles in every case, and parties can rely on past rulings to support their
arguments. This promotes efficiency and reduces the burden on the court system.
Limitations and Challenges: Balancing adherence to precedent with the need
for adaptation and change can be challenging. It's crucial to weigh the benefits of
stability against the need for legal progress in evolving societies.
 Impact Of Legal Environment Of
Business
● Taxation plays a critical role in impacting business growth.

Higher tax rates can limit profitability, while lower rates create

better conditions for increased earnings.

● Businesses prioritize consumer rights within this legal

framework to prevent exploitation, unfair practices, and fraud.

 Impact Of Legal Environment Of
Business
● The legal environment also encompasses regulatory activities such

as controlling environmental pollution, enforcing employment and

and ensuring food and drug safety.

● Also, a strong legal framework contributes to sustained business

prosperity and benefits both consumers and entrepreneurs.

 Impact Of Legal Environment Of
Business
● A favorable legal environment is crucial for economic growth.

Government-imposed taxation and regulations can foster

development while safeguarding consumer rights.

 EMERGING LEGAL TRENDS IN
BUSINESS
1. Data Privacy and Cybersecurity Regulations
2. Artificial Intelligence and Automation
Regulation
3. Environmental, Social, and Governance
(ESG) Compliance
4. Consumer Protection and Digital Transactions
5. Sustainability Reporting and Disclosure
 Benefits Of Studying Legal Environment
Of A Business
Proper business
Successful Business
Performance

Familiarity with
Max. margin of profit legal agendas of
country

Planning a proper
Strong & Healthy
business strategy
Economy
 Conclusion

A proper legal environment for a business helps a business

ecosystem to flourish. Alternatively, a strict legal environment
may hinder business activities too.
Thank you