The Difference Between Corporate Law and Business Law
November 1st, 2021
Many law firms handle both corporate law and business law matters. While there is no specific definition that identifies the difference between corporate law and business law, corporate law generally refers to how businesses are formed, governed, administered, and managed, while business law refers to the areas of the law that are associated with how the business operates, such as employment law, contract law, tax law, and business litigation.
Most people consider corporate law to be the subset of business law that refers to the formation and management of business entities. This may include forming a business entity such as a sole proprietorship, limited liability company (LLC), partnership, or corporation, and how the business operates.
Business law is a broader, more general category that is concerned with the relationships between the business entity and third parties such as customers, employees, vendors, or suppliers.
There can be considerable overlap between corporate law and business law, and looking at each category separately can help clarify the differences between the two. But when considering the difference between corporate law and business law, corporate law generally relates to the entity itself, while business law is concerned with the activities the corporate entity is engaged in.
What Is Corporate Law?
Corporate law concerns the formation and operation of the corporate entity. This often includes the creation of the business entity, the establishment of management duties and shareholder rights, corporate operations, and the application of state and federal regulations that are associated with operating a business. Corporate law is also concerned with how profits are divided, shareholder agreements, investor agreements, the types of shares issued, and the taxation and distribution of corporate assets.
A corporate lawyer typically works within a business setting. The corporate attorney may serve as general counsel or outside general counsel to the business and will work with other departments within the corporate entity to help the business make sound decisions and stay in compliance with federal, state, and local laws. Corporate lawyers often focus on business transactions and help the business by writing contracts and avoiding litigation.
What Is Business Law?
Business law is a broader category that is concerned with how different aspects of the law impact the corporate entity. A business lawyer will often address how the corporate entity is or will be affected by business decisions and helps manage the relationships between a business and its customers, vendors, or suppliers.
The business lawyer must have a broad knowledge base that should include employment law, contracts, taxation, and litigation. The business lawyer will provide assistance when it comes to the hiring and firing of employees and maintaining a safe and fairly managed workplace. A business lawyer will also handle the legal implications of delivery delays, defective products, licensing, and the terms and conditions that govern a business’s relationship with third parties. Business lawyers are often litigations who represent the corporation if it needs to file a lawsuit or has been sued.
Corporate Lawyer vs. Business Lawyer
In the simplest sense, the corporate lawyer addresses the formation of the business and how it functions, while the business lawyer is concerned with how the law impacts the business in its various activities. Another way of putting it is that the corporate lawyer writes the contracts, while the business lawyer interprets them.
RKPT: Business and Corporate Lawyers Serving the Midwest and Florida
RKPT attorneys represent businesses as both corporate lawyers and business lawyers.
Whether you need a business lawyer or a corporate lawyer, our attorneys will partner with you to become a trusted source of business advice and guidance.
Whether we represent you on a limited issue or serve as outside general counsel, you will find that our attorneys are good listeners who provide proactive, creative, and customized legal solutions based on the goals and risk tolerance of your business.
We routinely handle legal issues related to:
Choosing and forming the correct legal entity
Preparing contracts to clarify the relationship between business owners and employees
Negotiating business contracts
Investigating and completing mergers and acquisitions