Business Law for Australian Entrepreneurs – Part 1 of 4
Introduction to Business Law for Australian Entrepreneurs
– Part 1 of 4 Instalments
Your vision and drive as an entrepreneur may not be all it takes to ensure the success of your business. You also need a solid understanding of business law.
Business law establishes the framework within which businesses are able to operate legally. It is involved in establishing and maintaining standards for business operations, resolving disputes, protecting rights, and in the business’s dealings with government agencies and individuals.
This is the first instalment of our 4-part guide to the essential aspects of business law that business owners in Australia should know.
Follow these links to read other instalments of our Introduction to Business Law for Australian Entrepreneurs:
Part 2 – includes Consumer Law & IP Protection
Part 3 – includes Employment Law & Tax Obligations
Part 4 – includes Disputes, Legal Challenges & Business Law Resources
Australian business laws for SMEs
The legal system in Australia is based on common law, which means that it is primarily derived from court decisions rather than from legislation.
In addition to common law, various statutes and regulations —such as the Corporations Act 2001 and the Australian Consumer Law — govern different aspects of business operations.
It’s also important to familiarise yourself with the jurisdiction of the different levels of government.
For example, on the Gold Coast, both federal and Queensland state laws apply. Federal laws cover areas such as taxation and intellectual property. Whereas Queensland has its own regulations that cover areas such as business licensing, employment, and workplace health and safety.
Legal considerations for startups
One important decision you need to make when starting a business in Australia, is choosing the right business structure.
The most common options for small business structures are:
- Sole proprietorship
Each of these business structures has its own advantages and disadvantages, so it’s important to carefully consider the specific needs and circumstances before making your decision.
How to choose the right business structure
Choosing the right business structure will have long-term implications for your business venture.
The factors to consider when making this decision include the level of control you want over your business, the level of liability you are comfortable with, and the tax implications.
This is the simplest business structure and the most common one for small businesses. It offers you complete control as the business owner. But it also exposes you to unlimited personal liability for the business’s debts and obligations.
This involves two or more people sharing ownership and control of the business. Partnerships can be general partnerships, or limited partnerships that provide different levels of liability for each partner.
If you want to limit your personal liability, consider incorporating your business as a company. This is a legal entity separate from its owners, meaning the shareholders’ personal assets can be protected from the company’s debts and obligations.
Incorporating a company is more legally and financially complex. You will be required to register with the Australian Securities and Investments Commission (ASIC) and you’ll need to maintain proper corporate governance.
Take a look at our table showing the advantages and disadvantages of each business structure option.
In the next chapter, we will take a look at Australian Consumer Law, contracts and IP protection.
Read the 2nd instalment of our Introduction to Business Law for Australian Entrepreneurs.
Feel free to contact us today at Ballantyne Law when you need plain-talking advice on all aspects of business law.
Addressing your legal concerns, our commercial, estate and property lawyers will take the burden off your shoulders.
Contact our reliable lawyers on the Gold Coast now.
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