1 General introduction to company law and practice

1.1 ‘Company law’

Before embarking on this course, it is important to take some time to think about the implications of its title: Company law in context. In particular, what constitutes ‘company law’, and what is the context in which we are thinking about it?

At this point, you might like to pause for a moment and contemplate what this phrase means to you. In particular, what do you understand by the concept of a ‘company’?

At first, this may seem like a ludicrously straightforward question. However, try defining ‘company’, and the idea may become harder to pin down than you first thought. For example, what about people who run businesses on their own (‘sole traders’), or in partnership with other people? Can these ways of running a business be ‘companies’? Does it make a difference to a business's status as a company whether it deals in goods or whether it supplies services? Does it make a difference if the business is involved in manufacturing or designing items rather than selling them?

To help you understand how companies work, and how company law has developed, it is useful to start off by looking at the different ways in which a business can be run,and how forms of business organisations other than companies work. This will give us a background against which to place the study of company law and is why we will be concentrating on how sole traders and partnerships run their businesses.

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