Law is always evolving. It slowly changes over time in response to its environme
ID: 424497 • Letter: L
Question
Law is always evolving. It slowly changes over time in response to its environment. In business, new types of products, services and practices drive the development of law as it is forced to adapt to situations we can’t even think about today. A great example is the “gig” economy created by companies such as Uber and Lyft and their “do it yourself” ride service.
What new developments do you think will present the need to rethink and re-evaluate how business law concepts apply today or in the future?
Explanation / Answer
There are new technologies, globalization and new trends that can force the business laws to change and remain relevant. In this regard, the first development is the eCommerce business practices that brings in taxation laws. Traditionally, the taxation laws are framed for a company that is physically located in a particular state. But, now firms are getting online and operating in different states with virtual presence. It requires a change in taxation laws so that taxes and duties are effectively collected by the eCommerce firm with proper regulations.
The second development is the globalization, movement of foreign currencies and international supply management. The business laws are dealing with firms that are mostly confined in domestic boundaries. But, the company now deals in international markets, builds the global supply chain and involve transactions of foreign currencies. It requires a broader set of rules and laws that can prevent business oriented crimes. So, it makes business laws to revisit.
The third development is the growing scope of economic rent, corruption in overseas market and bribery case. The laws in most of the countries are mostly confined to the domestic business environment. But, the behavior of domestic companies in overseas markets should also be regulated. For example, formation of the Foreign corrupt practices act (FCPA) is the example of this future vision.
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