There is a huge difference between corporate and business law; the main difference is that corporate law refers to the body of law that focusses or how people form and manage corporate entities. Business law, on the other hand, refers to a general category that covers a wide array of laws ranging from contracts, employment law, taxation and commercial transactions. All these are laws that affect the way business is done and how business entities relate with one another. There are different types of business entities that include limited liability companies (LLC) all the way to sole proprietorships. There is a way in which corporate and business laws interact because even a corporation is a type of business.
If you are going to clearly understand the difference between corporate and business law, you will need to scrutinize each one of them separately. The corporate law basically concerns how corporations are operated; this will include different aspects such as the duties of the management, the rights of the shareholders or any other issues that mainly apply to corporations. There are specific laws that treat corporations as entities that are distinct from their owners; the corporation has different powers that include being able to enter contracts, file lawsuits and getting sued. Shareholders are the owners or a corporation and they have certain rights and responsibilities according to corporate law.
A good example can be where the management and directors of a corporation decide whether they are going to authorize the corporation to distribute dividends to the shareholders. A dividend refers to a share of profits that the corporation gives to its shareholders; the shareholders or owners of any corporation have the right to receive dividends and if the corporation refuses to authorize as such, the shareholders or owners have the right to file suit. A student needs to study corporate law so they can learn the types of law that apply in this case.
On the other hand, the business law will include several other areas of law a well; students who want to practice business law normally study different areas such as the way employment affects different types of business entities. Employment law is concerned with business practices such as the hiring and firing of employees as well as how business owners are supposed to treat their employees. When a business fails to follow the laid down laws they can easily find themselves in court defending a lawsuit.
There are other areas of business law that include tax laws; business is obliged to pay taxes just like any ordinary person; students of business law will have learned about tax obligations in addition to tax advantages as the relate to different business structures. It is important to understand a business is an activity that involves the buying and selling of goods and services as well as the manufacturing and distribution of the same and there are laws that govern those activities. Corporate formation leads to the formation of a business that then can carry out the said activities.