BASIC NOTIONS OF BUSINESS LAW

A. DISCUSSION
1. Imagine you can start your own business, the company of your dreams. Ignore the
financial, legal and technical aspects. What line of business would your company be in?
What kind of company would it be? Would you rather work for a multinational?
2. Comment upon the following quote.

3. Any business has to be considered in a legal system. Tick which of the following
categories of law could affect the commercial matters of a company.

International Law
Canon Law
Common Law
Civil Law
Criminal Law
Property Law

Intellectual Property Law

Business or Commercial Law
Family Law
Constitutional Law
Administrative Law

B. READING
How to Start a Business in Romania?
For many young managers, the law seems to be an abstract field, the domain of
attorneys, lawyers and barristers who are supposed to learn all those difficult regulations by
heart. Unfortunately, we regret to inform those of you who want to run profitable businesses
that basic notions of law are required if you are to take responsibility for your actions.
Therefore, let us think of an aspect of law which comprises the body of rules,
governing the dealings between persons in commercial matters1. Can you guess the
concept? Oh, yes, it is business law, also called commercial law or mercantile law, which
clearly regulates the legal dealings of a firm. According to the Encyclopaedia Britannica,
business law can be divided into two main areas: the regulation of commercial entities by
the laws of company, partnership, agency, and bankruptcy and the regulation of commercial
transactions by the laws of contract and related fields.
In this context, when a person or some partners want to start a business, they should
first decide on the type of commercial entity suitable for their line of business. In Romania,
according to the Romanian Business Law Treaty (Stanciu D. Crpenaru, 2012), the following
types of commercial companies operate: general partnership, limited partnership, joint-stock
company (sometimes called PLC in the UK- public limited company or Inc.- incorporated
company in USA), limited partnership by shares, limited liability company (Ltd.), or
European company (SE- Societas Europaea). We could add to this list the NGO, the nongovernmental organization, or the sole proprietorship/ trader, which exist in many European
countries. However, the most frequent forms of business in Romania are joint stock
companies and limited liability companies.
Assuming that the legal requirements have been met, before launching into trade, it is
advised to check what experienced business people have to say about their success stories.
The first step to follow is finding out why is important for you to become an entrepreneur in
order to create your own brand2. A distinction is often made between running a business
solely for profit and identifying a gap in the market for your own creative ideas. Pragmatic
executives would suggest that theres no point in going into business unless you can make
profit immediately; otherwise this is not a good deal and you will begin to lose time and
money.
Both competitors and potential clients are the next to take into consideration. Contact
customers to research their receptiveness to your products or services and the differences and
novelty they expect from you that the competition cannot give. Ideally, you should offer

http://www.britannica.com/EBchecked/topic/86266/business-law (accessed July 19, 2013)

This second part is adapted and translated from: http://reportajelive.wordpress.com/2013/01/03/cum-sa-incepio-afacere-o-lectie-de-la-niste-milionari/ and http://www.ziare.com/afaceri/plan-afaceri/vrei-sa-incepi-o-afacereafla-ce-trebuie-sa-stii-inainte-1063566 (accessed August 8, 2013)
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something better for half the price which, impossible as it may seem, can be achieved by
combining several services with innovation.
Wherever your business is based, one cannot ignore the European context and the
commercial laws of the Union. Imagine your firm as part of a globalized market and evaluate
it accordingly. A visionary professional stops to ponder the economic situation and starts to
think big. Why shouldnt you see yourself as if doing business in Paris? Could your
organization survive if your employees were paid at European level? Would your sales/
business contacts be relevant in the global market? Dont expect a smooth and easy journey;
after all, Going into business for yourself, becoming an entrepreneur, is the modern-day
equivalent of pioneering on the old frontier (Paula Nelson- American author).3
And by the way, dont forget the tools and resources necessary to write an attractive
business plan and to choose a location which is customer-friendly!

C. FOCUS ON VOCABULARY
1. In each pair decide which statement is true and which is false according to the text.
1a. Attorneys, lawyers, and barristers deal with legal matters on behalf of their clients.
1b. Attorneys, lawyers, and barristers deal with commercial matters on behalf of their clients.
2a. When starting a business, one first writes a business plan.
2b. When starting a business, one first evaluates his business ideas and finds a suitable type
of commercial entity.
3a. The joint stock companies and limited liability companies are the English equivalent of
Societate pe Aciuni and Societate cu Rspundere Limitat.
3b. The joint stock companies and limited liability companies are the English equivalent of
SRL and SA.
4a. New products or services on the market will always bring profit.
4b. The products or services that can fill a gap in the market, will bring you profit.
5a. Going into business is as easy as doing business in Paris.
5b. Going into business in a globalized world is as challenging as conquering the old frontier.

http://www.decision-making-solutions.com/entrepreneur_quotes.html (accessed August 30, 2013)

2. Match a word on the left with a definition on the right.

1. Sole Trader

a) It is a limited liability company (limited number of partners,

no more than 50), holding in common capital funds, usually
divided into shares between the owners. Decisions are made by
a majority vote in the General Meeting of the shareholders and
the management is assumed by a Council of Administration
(Board of Directors).
b) A company with at least half of its capital stock owned by
another company, sometimes a foreign company. It has a legal
personality and it is considered an entity of the country where it
resides in.
c) This office is set up by foreign corporations. While it cannot
carry commercial activities on their behalf, it is entitled to
promote and supervise the business of the parent companies. It
cannot earn revenues in local currency.
d) It is authorized by Ministry of Foreign Affairs and
undertakes on behalf of the parent company only transactions
and activities which are consistent to its authorized object.
e) It is just an extension of the parent company and therefore
has no legal personality and no independence. Legally, it has no
separate status from the company itself. It is merely carrying on
business in a different town.
f) This business is based upon a contract between two or more
partners. They are jointly liable for the debts and obligations of
the relationship.
g) It consists of one or more general partners who manage the
business and one or more limited partners who contribute
capital (money or other property), but do not participate in the
management.
h)
You
are
the
exclusive
owner
of
the
business, personally liable for all debts. There is no need to
have annual accounts audited or legal formalities to commence
trade.

2. General Partnership

3. Limited Partnership

4. Joint Stock Company

5. Representative Office

6. Branch Office
7. Subsidiary

8. Agency of a Foreign
Company

3. Find the word that does not fit the series of synonyms in each line.
a. legislation breach infringement violation transgression
b. enable entitle consent authorize warrant
c. right equitable unlawful honest fair
d. enforcement coercion constraint obligation disregard
e. evince relate demonstrate establish exhibit
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f. forbid pursue ban interdict prohibit

g. obstruct hinder restrict rule interfere
h. counterfeiting forgery piracy bribery imitation
i. familiar foreign outlandish overseas external
j. abolish abrogate eradicate exterminate vote

4. Use the word in capital letters, at the end of each sentence, to form the correct word
to match the definition.
a. The sentence people serve in captivity, consequently to serious offences.
PRISON ______________________
b. Wrongfully or dishonestly taking something that you have been trusted to keep safe, as
funds entrusted to ones care. APPROPRIATE
________________________
c. Lacking reason or judgment, refusing to listen, to reason. REASON _________________
d. Flexible, adjustable, changeable. ADAPT
_________________________
e. The alteration of a document (writ, pleading, indictment) for the purpose of correcting
some error in the original. AMEND ________________________
f. The person who makes a criminal complaint in England. COMPLAIN _______________
g. Persons who steal money that is in their care or belongs to an organization that they work
for. EMBEZZLE
________________________
h. The process of acquiring rights, immunities or obligations as a result of the passage of
time. PRESCRIBE
_______________________
i. The act of violating or breaking a law, or trespassing. INFRINGE __________________
j. Refusal, negation, rejection. DENY _______________________

5. Match a word from column A with a word from B to make a pair/ collocation and
find their appropriate translation.
A
1. to contravene
2. patent
3. money
4. out-of-court
5. to bend
6. law7. law8. to bring/ put to
(to take to court)
9. a set
10. to overrule

B
a. settlement
b. enforcement
c. a precedent
d. a law
e. abiding
f. a submission
g. infringement
h. trial
i. the law/ rules
j. laundering

Translation
1
2
3
4
5
6
7
8
9
10

D. GRAMMAR REVIEW
INFINITIVE AND GERUND
INFINITIVE

ACTIVE VOICE
(to) finish/ write
(to) be finishing/
writing
(to) have finished/
written
(to) have been
finishing/ writing
PASSIVE VOICE
(to) be finished/
written
(to) have been
finished/ written

Full Infinitive is used after:

1. Verbs: advise, afford, agree,
choose, decide, encourage,
expect, hope, intend, invite,
manage, offer, plan, promise,
refuse, seem, tend, threaten, etc.
The client decided to place an
order.
Some employees tend to be late.
2. Adjectives: amazed, angry,
delighted, difficult, disgusted,
easy, first, glad, happy, last,
likely, obliged, sad, sorry,
supposed, surprised, unable, etc.
My family was happy to hear I
had been promoted.
It is difficult to overcome
obstacles.
3. At the beginning of a
sentence in expressions: to tell
you the truth, to cut a long story
short, to be honest/ fair, etc.
To be fair, I should admit my
mistake.
4. () it ()+ adjective+ for+
object+ infinitive
It is unusual for meetings to
start late.
Its essential for the job to be
finished in time.

Short Infinitive is used after:

1. Modal verbs: can/ could,
may/ might, must, shall/ should,
will/ would
We could look for the
information on the internet.
Im afraid we must go.
2. The structures: had better/
would rather/ would sooner.
Youd better consider their offer.
3. Some verbs: help, let, make,
(in Active Voice).
Michael helped me finish the
report.
4. Why not
Why not arrange a new meeting
for another day?

5. Nouns: aim, idea, mistake,

plan, pleasure, shame, time
Our aim is for buyers to be
content with our products.
Its a pleasure to meet you.
6. Question words (wh-words):
We dont know what to do.

GERUND

ACTIVE
VOICE
cooking/ doing
having cooked/
done
PASSIVE
VOICE
being cooked/
done
having been
cooked/ done

The gerund is used after:

1. Verbs: admit, anticipate, appreciate, avoid, consider, delay, deny,
detest, endure, escape, fancy, imagine, incur, involve, keep, mention,
mind, miss, postpone, practise, prevent, propose, recall, report, risk,
save, suggest, understand, etc.
This job involves organizing the Sales Department.
The CEO proposed analyzing the R&Ds report on future projects.
2. Verbs and expressions with prepositions: approve of, be good at,
be fond of, be for/against, be interested in, be used to, feel like, insist
on, look forward to, object to, succeed in, think of/about, etc.
Ian is against starting the new project.
We are looking forward to doing business with you.
3. Expressions: its no use/ good, its (not) worth, have difficulty (in),
theres no point (in), feel like, etc.
Im having difficulties in reading the memo: its in German.
4. Prepositions: after, before, by, instead of, when, while, without.
I eat in my office instead of going to the canteen.
She often makes decisions without telling her subordinates.

INFINITIVE OR GERUND?
Some verbs and adjectives can be followed by either Infinitive or Gerund, with or
without differences in meaning.

I. Verbs taking Infinitive or Gerund WITHOUT a great difference of meaning:

attempt, begin, cease, continue, commence, detest, enjoy, finish, intend, like, love, hate,
omit, plan, prefer, propose, recommend, start; it needs/ requires/ wants; cant/ couldnt
bear.
I like working in the morning. (more typically U.K.)
I like to work in the morning. (more typically U.S.)
He began/ started repairing/ to repair computers when he was 16.
I couldnt bear telling/ to tell them the truth.

II. Verbs taking Infinitive or Gerund WITH a change in meaning:

VERB

GERUND
REMEMBER Refers back to the past, to things that
one did.
I still remember signing my first
contract.

INFINITIVE
Refers forward in time, to things that
one still has or still had to do at the
moment of remembering.
You must remember to sign the
contract with Mr. Jones tomorrow.

FORGET

GO ON

STOP

REGRET

TRY

MEAN

ADVISE
ALLOW
PERMIT
FORBID
LEARN
TEACH

Refers back to the past, to things that

one did. Mostly used in the phrase:
Ill never forgeting.
Ill never forget seeing The Pope.
Means to continue.
She went on explaining her project
until we all got bored.
Means to cease.

After such accusations I stopped

talking to him.
Refers back to the past, to something
that one is sorry one did.
I really regret informing the
manager about my colleagues
mistake.
To talk about making an experiment,
a new experience.

Refers to a change of activity.

She introduced everybody and went
on to explain her project to us.
Means to interrupt an activity and
start doing something else, in order
to...
I stopped (reading) to talk to him.

Is used mostly in announcements of

bad news.
We regret to inform you that your
credit card information may have
been compromised.
To talk about making an effort to do
something difficult, which might fail
or succeed.
I tried calling each and every
I tried to call the customer service
employee of the customer service
department, to write e-mails, but they
department for fun.
still wouldnt answer to me.
With the meaning of involve, have With the meaning of intend.
as a result.
If you want to get a job it will mean
She says she means to study English
studying English.
as soon as possible.
No object
+ object
They dont allow/ permit taking more They dont allow/ permit employees
than three coffee breaks.
to take more than three coffee breaks.
Refer to lessons or subjects of study.
Every winter he goes to the
mountains to learn skiing.

FEEL
HEAR
LISTEN
NOTICE
OBSERVE
OVERHEAR
SEE
WATCH

Refers forward in time, to things that

one still has or still had to do at the
moment of forgetting.
I forgot to see my accountant today.

Suggest that an action is in progress.

I saw them looking for a solution.
Suggest we watch, hear a part of an
action.
I could watch them building their
new house.

Refer to the result of the study, to the

process of learning a skill.
He learnt to ski because he went to
the mountains every winter.
SHORT INFINITIVE
Suggest a completed action.
I saw them look for the best solution.
Suggest we watch, hear the whole
action, from start to finish.
I could watch them build a new
garage and pull it down.

PRACTICE:
1. Tick the correct form of the verb.
1. Dear applicant, we regret ____ that your application has been unsuccessful this time.

to inform
informing
2. I regret ____ to conclusions, without careful thinking.

to jump
jumping
3. We tried ____ to our customers personally, but we couldnt convince all of them.

to speak
speaking
4. They tried ____ their products on international markets.

to sell
selling
5. He stopped ____ when he discovered a pulmonary affection.

to smoke
smoking
6. Quite surprisingly, he stopped his speech ____ a very important call.

to answer
answering
7. One more thing, dont forget ____ all the clients.

to call
calling
8. No way, I cant have forgotten ____ such an important agreement.

to sign
signing
9. I overheard them ____ the misappropriation

to plan
planning
10. I noticed them ____ a strong brand which the public had confidence in.

build
building
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2. Translate into English.

1. Firma noastr s-a hotrt s retrag posterele greite imediat.
2. Reabilitarea ageniei a inclus donarea unei mari sume de bani.
3. nchipuiete-i-o venind la timp!
4. Dac ai terminat de scris raportul, te rog pred-l efului de departament.
5. Cnd au sosit n sfrit, ne-au spus c le-a luat o or s ajung pn la noi.
6. Nu a risca s-i telefonez.
7. M-a rugat s-o ajut s multiplice materialele publicitare.
8. Filmul chiar merit vzut.
9. Ei i-au cumprat bilete pe rndul nti ca s nu piard nimic din pies.
10. Mi-a fcut mare plcere s lucrez cu voi la acest proiect.

3. Complete the following sentences with a verb from the list below, using either the
gerund or the infinitive: argue, do*3, get, leave, live, see, take, talk.
a. I miss _______________ in England.
b. I enjoyed ______________ my former colleagues again.
c. He avoided ______________ to them because he was in a hurry.
d. I promised ______________ it by Friday.
e. She is expected _______________ the job.
f. Would you like _______________? Im tired and hungry.
g. She taught me _______________ it.
h. They dont tolerate any ________________ about their decisions.
i. I dont feel like ________________ the same thing over and over again.
j. Do you mind _______________ it with you? I have no use for a useless object like this.

4. Fill in the blanks with the correct preposition.

1. Can you begin ........................ outlining an agenda and then announce everybody?
2. Youll have to get used .. meeting tight deadlines.
3. I dont approve ......................... my employees leaving the office earlier without prior
notice.
4. Were depending ....................... you to find a fast solution.
5. Because of the noise, I had to shout ...................... the man.
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6. The holidays of our colleagues prevented us ........................... finishing the product.

7. There is no point ........................... continuing this research.
8. John insisted .. everybody wearing suits at work.
9. She confessed .. having listened to that private conversation.
10. They arranged the visitors to stay in a hotel near the office.

5. Fill in the blanks of the following rejection letter, using the verbs in brackets in the
right form.
Dear Ioana,
Thank for your (show) _______________ interest in our company.
We appreciate the opportunity (consider) ________________ you for a position in our team.
We have reviewed your background and experience and those of the other applicants.
However, because of the quality of candidates, the decision was extremely difficult (make)
______________. Although your application and interview were impressive, we have
decided (proceed) ______________ with other candidates who meet our needs more closely
at this time. Our decision was based upon (compare) ________________ the demands of the
position with the abilities shown by each candidate.
We are now writing, with regret, (inform) ______________ you that your name has not been
placed on the short list of candidates.
Thank you so much for (take) ______________ the time (come) ______________ to our
headquarters. We enjoyed (meet) ______________ you and our discussions.
We hope there may be other employment opportunities of interest to you in the future and
that you will continue (apply) ______________ for vacancies in our company.
Yours sincerely,
Gabrielle Smith
Human Resources Manager

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E. COMMUNICATION SKILLS
1. Read the text below. Work with a partner and find a solution to this problem. In light
of the following facts, advise the company as to its rights, if any, under Romanian or EU
law.
Chocolat Suisse is a major Swiss producer of fine chocolates. It sends a shipment of
chocolate to its distributor in Romania, but the shipment is refused entry at Ndlac Customs.
The reasons given by the customs officials for refusing entry are:
a. The chocolate boxes are not labeled in Romanian. There is a legislative
requirement that all food imported into Romania must be labeled in Romanian;
b. The chocolates are packed unsatisfactorily according to the consumer protection
standards;
c. The Swiss chocolates contain additives which are not allowed in chocolates
marketed and sold in our country.
In addition, Chocolat Suisse have also been told by La Doi Pai, a supermarket chain
to whom it had sold large quantities of chocolates, that they will not be stocking the Swiss
product, as part of their Fabricat n Romnia campaign, which encourages shops to sell
Romanian products, to the detriment of the ones of foreign origin.
(Adapted from: Gabril Moens, John Trone, Commercial Law of the European Union, 2010, 426)

2. A mission statement is a brief description, in general terms, of a companys overall

policies and main objectives, stating it reason for existing. Write a mission statement for
the company you would like to found or for the company you work for, using some of
the suggested vocabulary.
- to focus on imperatives
- change and continuous improvement
- our organizational culture cultivates
unique thinking
- capable team
- tailored services
- to deliver innovative solutions and
excellence
- customers satisfaction
- to outperform competition
- to treat customers with compassion and
kindness

- to achieve our vision

- to strive to deliver high quality
- our commitment to equal employment
- in pursuit of our mission, we believe
- a unique combination of talent and
experience
- to act with honesty, integrity and fairness
- our company endeavours/ strives to
provide
- to access a multitude of resources
- to foster/ support programs that enable
balance

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