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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

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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 non-

governmental 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

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

2 This second part is adapted and translated from: http://reportajelive.wordpress.com/2013/01/03/cum-sa-incepi-

o-afacere-o-lectie-de-la-niste-milionari/ and http://www.ziare.com/afaceri/plan-afaceri/vrei-sa-incepi-o-afacere-

afla-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.

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

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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).

2. General Partnership 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.

3. Limited Partnership 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.

4. Joint Stock Company 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.

5. Representative Office 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.

6. Branch Office 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.

7. Subsidiary 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.

8. Agency of a Foreign

Company

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.

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

1 2 3 4 5 6 7 8

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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 B Translation

1. to contravene a. settlement 1

2. patent b. enforcement 2

3. money c. a precedent 3

4. out-of-court d. a law 4

5. to bend e. abiding 5

6. law- f. a submission 6

7. law- g. infringement 7

8. to bring/ put to

(to take to court)

h. trial 8

9. a set i. the law/ rules 9

10. to overrule j. laundering 10

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D. GRAMMAR REVIEW

INFINITIVE AND GERUND

INFINITIVE Full Infinitive is used after: Short Infinitive is used after:

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

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.

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. 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. 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?

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.

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.

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GERUND The gerund is used after:

ACTIVE

VOICE

cooking/ doing

having cooked/

done

PASSIVE

VOICE

being cooked/

done

having been

cooked/ done

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 INFINITIVE

REMEMBER Refers back to the past, to things that

one did.

I still remember signing my first

contract.

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.

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FORGET Refers back to the past, to things that

one did. Mostly used in the phrase:

Ill never forgeting. Ill never forget seeing The Pope.

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.

GO ON Means to continue. She went on explaining her project

until we all got bored.

Refers to a change of activity.

She introduced everybody and went

on to explain her project to us.

STOP Means to cease.

After such accusations I stopped

talking to him.

Means to interrupt an activity and

start doing something else, in order

to...

I stopped (reading) to talk to him.

REGRET Refers back to the past, to something

that one is sorry one did.

I really regret informing the

manager about my colleagues mistake.

Is used mostly in announcements of

bad news.

We regret to inform you that your

credit card information may have

been compromised.

TRY To talk about making an experiment,

a new experience.

I tried calling each and every

employee of the customer service

department for fun.

To talk about making an effort to do

something difficult, which might fail

or succeed.

I tried to call the customer service

department, to write e-mails, but they

still wouldnt answer to me. MEAN With the meaning of involve, have

as a result. If you want to get a job it will mean

studying English.

With the meaning of intend.

She says she means to study English

as soon as possible.

ADVISE

ALLOW

PERMIT

FORBID

No object

They dont allow/ permit taking more than three coffee breaks.

+ object

They dont allow/ permit employees to take more than three coffee breaks.

LEARN

TEACH Refer to lessons or subjects of study.

Every winter he goes to the

mountains to learn skiing.

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.

FEEL

HEAR

LISTEN

NOTICE

OBSERVE

OVERHEAR

SEE

WATCH

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.

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.

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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