When clients search for legal services it is rarely obvious what and who they should be looking for. Often this is because people are unaware of the differences between lawyers’ practice areas and the type of work they do. Two commonly grouped practice areas are corporate and commercial law. Whilst both areas are concerned with businesses, there is a clear distinction between the two areas. Below we discuss the difference between the two areas of law.
What is Corporate Law?
Corporate law governs the formation, operation, and dissolution of corporations. It covers areas such as corporate governance, shareholder rights, mergers, acquisitions, compliance, and liability. Corporate law ensures businesses operate within legal frameworks while protecting stakeholders’ interests. As corporate lawyers have highly specialised knowledge on these topics, they are highly valued by clients.
Corporate law matters often relate to the launch, growth, maturity or decline of a business. Further, these phases create significant changes in markets and business operating landscapes. In order to keep adapting to new challenges in the market these businesses engage in activities which create work related to:
- Acquisitions
- Corporate finance
- Corporate restructuring
- Insolvency
- Litigation
- Mergers
Example
Aaron is looking to set up a partnership between himself and two friends from university. They aim to pool their capital and launch a new low sugar natural beverage to be sold by markets, private vendors and bars. Aaron would like clarity on how the partners will operate in the new business. A corporate lawyer would be able to assist Aaron with a partnership agreement. This agreement would provide Aaron certainty on this issue and assist in resolving any future disputes.
What is Commercial Law?
Commercial law, also known as business law, governs the rights, relationships, and conduct of individuals and businesses engaged in commerce, trade, and sales. It includes areas such as contracts, property, employment, and business transactions to ensure fair practices and legal compliance in business operations.
The range of commercial activities covered by commercial law is diverse. Commercial law matters may include topics such as:
- Competition law
- Consumer law
- Contract law
- Intellecutal property
- International trade law
- Labour law
- Property Law
Example
Linda owns a local chicken shop and is looking to get some legal work done for her business. She needs to hire two new casual employees but does not have a current employment contract which she can hire anyone with. Additionally, Linda has developed a secret spice mix that makes her chicken delicious. She would like to get a patent on her recipe because she wants to sell it separately without worrying that someone might copy her recipe. Commercial lawyers could assist Linda with both an employment contract and a patent.
What’s the main difference
In summary, the main difference between corporate and commercial law is that corporate law deals with the governance and regulation of businesses whereas commercial law focuses on matters arising from transactions and commercial trading.
