Chapter Five

Legal system of economic behavior

Part One

law system of contract

Concept and characteristics of the contract

• Contract is the legal concept of contract law, refers to the principal of equality of natural persons, legal persons and other organizations to establish, change or terminate civil rights and obligations of the agreement.

Concept and characteristics of the contract

Characteristics

• Behavior of the parties the contract is generally

• Contract is a civil legal action

• Contracting parties have equal legal status

Classification of contracts

• Well-known contract with the unnamed contract

• Promise into a contract with the practice of contract

• To the contract type contract and do not type

• bilateral contract and a single service contract

• the contract paid and unpaid contract

The concept and principles of contract law

• Contract law is to regulate the basic law of market transactions.

• Equality

• Voluntary

• Fairness

• Comply with the law, without prejudice to the principle of public interest

Set up the contract

• The content and form of contract

• The set up program of the contract

• Establishment of a contract

• Culpa

Validity of the contract

• Concept Validity of the contract is a contract

established by law, after the parties have legally binding.

• Effectiveness uncertain contract Despite the uncertain effect of the contract

is set up, but the lack of effective elements of leaving the force in an uncertain state of the contract.

Validity of the contract

• Apparent and ultra vires acts

• Invalid invalid contract and disclaimer

Although the contract is invalid, but the establishment of violation of mandatory provisions of law do not take legal effect from the beginning of the contract.

May revoke or the contract can be changed

Performance of the contract

• Concepts and principles

Performance of the contract by the debtor shall agree to fully perform their contractual obligations.

The principle of full implementation

The principle of good faith

Performance of the contract

Right of defense in the performance of the contract

Fulfill the right of defense at the same time The first performance of the right of

defense Right to Plea Preservation in the performance of the

contract Subrogatio the right to withdraw

Changes and transfers of the contract

• Changes of the contract Contract changes, including the main

contract and contract changes.The former refers to the contract does not change the subject, but only to change the contents of the contract;The latter refers to the case of the same contract, debt or liability by a third person to bear.

Changes and transfers of the contract

• Transfers of the contract• Transfers of contracts is one of the parties

according to their contract rights and obligations of the contract in whole or in part transferred to the third person.

• Transfer of contractual rightsTransfer of contractual obligationsTogether with the transfer of contractual rights and obligations

Breach of contract

• Concept and characteristics• Parties to the contract refers to liability for

breach of obligations under the contract or agreement does not meet contractual obligations to be civil liability.

(1) Civil liability for breach(2) Liability for breach of contractual obligations is

a breach of obligations arising(3) Liability for breach of a relative(4) Liability for breach of contract by the

contracting parties

Breach of contract

• Exempt from liability breach the contract

Disclaimers of liability for breach of conditions of force majeure and limited to the parties agree that the exemption clause, and the parties agree that the exemption clause does not violate the mandatory provisions of law.

Breach of contract

• The form of taking the liability

Continue to fulfillRemedial measuresDamagesPayment of liquidated damages

Part Two

Legal system of advertising and unfair competition

Advertising law

When you perform a legal review of your company's -- or your client's -- ads, you need all the relevant information about advertising law compliance at your fingertips because there are many pitfalls and problems that could be avoided by having this knowledge.

Advertising law

There's no shortage of sources for the raw information you're looking for -- lengthy (and often unsuccessful) Internet searches, expensive online databases, internal computerized databases, and offline cases, decisions and rules from myriad sources. You may eventually find that advertising law compliance information -- assuming you have enough time.

Anti-Unfair competition law

This law is drawn up in order to safeguard the healthy development of the socialist market economy, encourage and protect fair market competition, prohibit unfair competition, safeguard the legal rights and interests of managers.

Anti-Unfair competition law

• Managers shall abide by the principle of voluntariness, equality, impartiality, honesty and good faith, and also adhere to public commercial moral in their business transactions.

• The governments in all levels shall adopt methods to prohibit unfair competition and to create the sound environment and conditions for fair competition.

Anti-Unfair competition law

• The State shall encourage, support and safeguard all organisations and individuals to carry out social supervising for unfair competition.

• Officials in the State organs should not support or shield unfair competition.

Part Three

Labor Law

Labor Law

• Concepts Labour law (also called labor law or

employment law) is the body of laws, administrative rulings, and precedents which address the legal rights of, and restrictions on, working people and their organizations. As such, it mediates many aspects of the relationship between trade unions, employers and employees.

Labor Law

• Categories

However, there are two broad categories of labour law. First, collective labour law relates to the tripartite relationship between employee, employer and union. Second, individual labour law concerns employees' rights at work and through the contract for work. The labour movement has been instrumental in the enacting of laws protecting labour rights in the 19th and 20th centuries.

Labor Law

Labour rights have been integral to the social and economic development since the Industril Revolution. They are social norms (in some cases also technical standards) for the minimum socially acceptable conditions under which employees or contractors will work. Government agencies (such as the former U.S. EmploymentStandards Administration) enforce employment standards codified by labour law (legislative, regulatory, or judicial).

Labor contract system

• A senior Chinese official on Tuesday urged the rapid establishment of a sophisticated labor contract system across China. Wang Zhaoguo, vice chairman of the Standing Committee of the National People's Congress, said the contract system would establish an important legal framework in labor relations, and should be fully set up across the country.

Labor contract system

• Taking part in a teleconference on labor contract system reform held on Tuesday, Wang, also president of All-China Federation of Trade Unions, said the contract system should be set up and efforts made to create fair, balanced, and harmonious labor relations.

• China plans to establish an all-round labor contract system by 2008, by which time most firms in China should have signed labor contracts with their employees.

Labor contract system

• According to the plans, contract administration will be mature by then.

• In the past, most Chinese workers enjoyed the "cradle to grave"welfare system. But over the past dozen years, as China has shifted to a market economy, an increasing number of workers have signed labor contracts covering their salaries and welfare.

Labor contract system

• The current labor contract system was initiated by the labor law enacted 12 years ago. The top legislature is currently examining the country's labor contract law.

• A draft of the labor contract law was submitted to the legislature for review last December.

Part Four

Securities Law

The outline of the Securities Law

Securities are entitled to certain rights that the holder of a certificate known, is used to prove the security holders of their rights to obtain the appropriate certificate contained.One is priceless securities, the securities themselves can not be made to holders of securities income, such as car tickets and other securities that are priceless.

The other is securities, which has a certain nominal amount, to prove that its holder the right to obtain certain rights or claims of ownership documents.

Basic principles of securities law

Basic principles of securities law under the Securities Act the issuance of securities and securities trading activities must follow the basic guidelines, which reflects the basic spirit of the Securities Act.

The issuance of securities

Concept Approved the issuance of securities is

eligible issuers to raise funds for the purpose, in accordance with legal procedures to the behavior of securities sold to investors.

Shares issuedCorporate bondsSecurities underwriting

The general provisions of the securities and exchange

(1)securities traded on the stock exchange should be.

(2) SEC should adopt the centralized auction transaction.

(3)Securities trading parties to the transaction can be in paper form securities regulatory authority under the State Council, or any other form.

(4) Spot transactions in securities transactions.

The general provisions of the securities and exchange

(5)Spot transactions in securities transactions.

(6)Securities companies shall not engage in financing to customers or trading in securities trading activities.

The general provisions of the securities and exchange

(7)Stock exchange, securities companies, securities registration and settlement institution employees, the securities regulatory agency staff and the laws and administrative regulations prohibit other persons involved in stock trading, or the term within the statutory period, shall not directly or with a pseudonym, by the name of another holding, trading stocks, but also may not accept gifts of stock to others.    

The general provisions of the securities and exchange

(8) Stock Exchange, securities companies, securities registration and settlement institutions required by law to set up accounts for clients confidential.

(9)Securities and Exchange fees must be reasonable and open fees, charges and fees.

The general provisions of the securities and exchange

(10) Co., Ltd. holds a 5% of issued shares have a shareholder, should reach the proportion of its holdings within three days from the date of the report to the company, the company received within 3 days from the date of the report to the State Council Securities Management agencies;A listed company, it shall report to the stock exchange to political power.

Listing of Securities

• Stock market

• Corporate bond market

• Suspension or termination of listing of securities listed

Continuous disclosure

• Principles of information disclosure

• Interim Report

• Annual Report

• Interim report

• Violation of the responsibility system of continuous disclosure

Acquisition of listed companies

• Concept

Acquisition of listed companies is the investors through the stock exchange of securities transactions, tender offer or agreement to buy the way, public acquisition of the shares issued by listed companies, in order to achieve the purpose of controlling behavior or mergers.

Acquisition of listed companies

• Tender offer Is a tender offer by the acquirer to the

acquiree's shareholders to make an offer way acquisition.

An agreement to acquire Agreement is the acquirer through the

acquisition of the acquired company's stock with the holder agreed to be acquired way of acquisition.

Securities institutions

• Stock Exchange

• Securities

• Securities registration and settlement institutions

• Securities trading services

• Securities Industry Association

• Securities regulatory authority

Part five

Financial and legal systems

The liability of violation of securities law

Concept It refers to the relationship between the

main body of securities laws violations of securities laws and regulations should be punished.

Securities violationsLiability form

(1) Civil liability (2) administrative responsibility (3) criminal

Concept of financial and legal systems

Financial law deals with the broad range of savings and investments products in which individuals, businesses and institutions hold trillions of dollars, and the services related to those products. The products and services play a vital role in the world economy and directly employ millions of individuals in the United States.

Content of financial and legal systems

They include:

(1) Banking (whether at banks, trust companies, savings banks, savings an

loans or credit unions)

(2) Brokerage services (covered under broker disputes)

(3) Commodites

Content of financial and legal systems

(4) Consumer lenders (including credit card issuers) (5) Insurance including annuities (which is covered in a practice area of its own) (6) Investment advisors (7) Mortgages (which are covered as a topic in real estate) (8) Mutual funds (a type of security) (9) Stocks and bonds (covered under securities)

Money management

• Money management is the process of managing money. It includes investment, budgeting, banking and taxes. It is also called investment management.

• Money management is a strategic technique employed at making money yield the highest of interest-yielding value for any amount of it spent. Spending money to provide answers to all cravings is a natural human phenomenon.

Money management

• The idea of money management techniques is developed to plummet the amount individual, firm and institutions spends on items that add no significant value to its living standard, long-term portfolios and asset-basins.

• Warren Buffett, in one of his documentaries, admonished prospective investors to embrace his highly-esteemed "frugality" ideology.

Money management

• The following are powerful techniques that can be employed in making every expense made to be worth it:

• 1. cutting your budget on social needs2. avoid any snob-appealing expense3. always go for the most cost-effective alternative (establishing small quality-variance bench-mark, if any)

Money management

• 4. increase expenses more on interest bearing item than any other thing5. establish the expected benefits of every desired expense using the canon of plus/minus/nil to standard of living value system.

Credit Management

• Credit means delaying payment for goods or services you have already received until a later date. Credit management is concerned with making sure that organisations, who buy goods or services on credit, or individuals who borrow money, can afford to do so and that they pay their debts on time.

Credit Management

• Credit jobs exist within any industry sector eg manufacturing, distribution, retail, telecoms, utilities, local authority, financial services, and within any size company from SMEs (Small, Medium Enterprises) to large corporates. You could also work for a company specialising in credit management services eg debt collection agency, credit insurance company, credit reference agency.

Exchange control

• Types of controls that governments put in place to ban or restrict the amount of foreign currency or local currency that is allowed to be traded or purchased. Common exchange controls include banning the use of foreign currency and  restricting the amount of domestic currency that can be exchanged within the country.   

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