All companies operating within the boundaries of the USA are subject to specific statutes. Some of these laws are made by the federal government and apply to all corporations across the country. Other codes are made by the different state governments and are applicable only on the corporations located within the state.
Multinational corporations -the present and future
Multinational companies are subjected to the laws in force in other countries too. They also have to adhere to the various international treaties, statutes and regulations promulgated by institutions such as different organs of the UNO, World Bank and International Monetary Fund. All of these statutes, ordinances and rules are collectively referred to as ‘Corporate Law’.
Adherence is of utmost importance
If a company fails to follow the rules in force, it has to bear the consequences. The omission of a necessary task as per one of the statutes may cause significant damage to any corporation. It may be penalized monetarily in case of the omission if of civil nature. The directors or other employees may even face criminal charges if the act is unlawful.
Statutes allow companies to come into existence
The registration and creation of companies must be done as per the provisions in the relevant laws. Failure to comply with the mandatory requirements as per the applicable statutes can cause problems. A corporation will not exist in the eyes of the law if the necessary conditions of registration are not fulfilled.
A separate legal identity
You must understand that all corporations, whether public or private, have a distinct and separate legal existence. A company can sue individuals and other institutions if its rights are infringed. Similarly, they can also be sued if they are found violating the rights of other individuals or companies. A suit to seek damages from a company is different from a legal case against the directors or employees of the corporation. It is vital that people understand this distinction.
The duties of corporations
Corporate social responsibility, maintenance of accounts and records are among the essential responsibilities of all companies. National, international, as well as State laws, determine the quantum of punishments if some of the laws are broken. If you want to start a company, you must be aware of all the rules and regulations in this regard.
Hire a corporate lawyer
A corporate litigation expert can inform you about all the things that you must do. They can handle the process of registration of your company along with the future compliances.
Read More : Responsibilities of Corporate Lawyers