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What Is Commercial Law in Business?

If U.S. society were a tree, its code of laws would be the root system that allows the tree to stand firm and tall. The bigger the tree grows, the deeper and more complex the root system becomes. After all, a larger tree needs more roots to ensure it does not topple over. The same is true for the United States and its legal system. The larger the U.S. grows, the more tangled and complex its legal system becomes. One way to visualize this is to look at legal documents from different time periods.

In 1776, our founding fathers declared sovereignty from Britain by signing the U.S. Declaration of Independence, a document containing 1,458 words (including each signer’s name). About 250 years later, Apple released its general Terms & Conditions, consisting of 7,314 words.

As the breadth of our modern legal code evolves, certain areas inevitably overlap. A perfect example of this is found in business and commercial law. While people sometimes use these two branches (or roots) of law interchangeably, modern law students would be well advised to recognize commercial law as its own entity.

What Is Commercial Law? defines commercial law as an area focused on selling and distributing goods and financing transactions. In other words, commercial law monitors the conduct of individuals and merchants engaging in commerce. For instance, consider a company like Amazon.

Amazon’s main business is selling products to consumers through its digital platform. To do so, it must buy warehouses, stock inventory, and ship/receive products. These needs fall under the category of commercial law. However, Amazon also has dozens of business lines that could be classified as business law, so it is important to recognize the distinction between these two areas of law.

How Is Commercial Law Different from Business Law?

According to UpCounsel, business law consists of different practice areas associated with business. A few examples are employment, tax, contract, and transaction law. On the other hand, commercial law focuses on selling and distributing goods, which is technically a practice area of business. These examples show why many legal professionals consider commercial law a subset of business law.

However, one critical distinction between these two is the governing body that regulates them.

Uniform Commercial Code (UCC) primarily regulates commercial law. The UCC is a set of laws governing commercial transactions in the U.S. The federal government does not enforce these laws, but each state uniformly adopts them. This approach ensures that corporations can expect uniform regulations when they conduct business across state lines.

On the other hand, both state and federal law regulate business law, meaning law professionals working in the private sector will likely need to become familiar with the requirements of the UCC as well as federal and state laws. Current law students could save lots of time by recognizing this distinction while still in school.

These are just some examples of the importance of separating commercial law from business law.

The United States of Flux

With that said, remember that the U.S. tax code is constantly in flux. Each year brings new changes or standards for different branches of law. People can also sometimes interpret existing rules and regulations differently, just as the same English word can have different meanings depending on where you live in the United States.

In fact, UpCounsel even states that exact definitions for commercial and business law can vary firm by firm.

One way to ensure aspiring law professionals are well-versed in both areas is to receive the highest education possible. This way, they fully understand the most up-to-date intricacies of both topics.

Which Route Is Best?

Before entering the professional arena, one of the best ways for aspiring lawyers to make themselves attractive candidates is to receive a Master of Business Administration (MBA). Many programs, like Emporia State University’s Master of Business Administration online program, equip students with the foundations of commercial law and the business aptitudes to excel in the private sector. ESU’s MBA online program can be completed fully online in as little as 12 months.

Notably, ESU’s MBA online program offers a course titled Law of Commerce. In this course, students will study a broad range of topics that will help prepare them for two milestones, the CPA exam and a law career that overlaps with the private sector. A few subjects covered in this course are the common law of contracts, sale law (UCC), secured transactions, negotiable documents, bailments secured transactions, property law, trusts and estates, and bankruptcy law.

Learn more about Emporia State University’s online Master of Business Administration program.

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