Business Law: an Introduction

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Business Law: An Introduction
Learning Outcome 1

1. Identify & describe the source of legislation that are binding in Scots Law and quote at least one example.

Legislation comes in 4 main sources in Scotland; UK Parliament, Scots Parliament, European Union and delegate legislation.

UK Parliament

Laws that are passed by Parliament come from proposals that are made by the Government. These proposals aim to shape society or address certain problems. Once such proposals have been consulted on they are turned into bills. A Bill is the draft of an Act of Parliament. The bills are submitted for debate to be scrutinised by both House of Commons & House of Lords.

All bills pass through the process outlined below:

• First Reading – Bill read out in Parliament
• Second Reading – MP’s discuss & debate the proposals of the bill • Committee Stage – Committee of MP’s consider bill. Closely scrutinised. Any amendments will be proposed and voted on. • Report stage – The bill with any amendments is reported to House of Commons. All members can review bill. Amendments can be proposed & voted on. Anyone involved in amendments at the previous stage cannot suggest further changes. • Third Reading – MP’s debate and vote on final bill. It will usually be passed at this stage.

The bill then goes through the same procedure in House of Lords, where further amendments can be made. On its return to House of Commons the amendments are approved or rejected. Once approval from both Houses the bill receives formal approval from the Queen. This is when the bill is given Royal Assent. A bill becomes law or an Act of Parliament.

Examples of Acts that UK Parliament has passed are: Sale of Goods Act (1979) and Employment Rights Act (1996).

Scottish Parliament

In 1998, UK Parliament passed the Scotland Act which gave powers to the Scottish Parliament. Certain powers were given to Scots Parliament to make decisions & to pass legislation on certain matters. Such powers are called devolved powers or devolved matters.

The Scottish Parliament has power to produce legislation on devolved matters only. It does not have to consult Westminster or go through UK Parliament to pass new laws.

Powers that have been kept by UK Parliament are called reserved powers or matters. Devolved powers include health, social work, education, training, local Government, housing & economic development. Reserved matters include; constitution, foreign affairs, defence & immigration to name a few. All UK Parliament laws take precedent over Scots Law; however UK Parliament won’t normally legislate in any devolved matter without prior agreement of Scottish Parliament.

The Scots Parliament has power to pass primary legislation but cannot legislate on reserved matters. Tax rates set in UK Parliament apply to all the UK however; Scottish Parliament has power to alter income tax by up to 3p in £1.

A bill for any new legislation goes through the following process:

• Stage 1 – Committee & Parliament consider general principles of Bill. Debate & agree on principles • Stage 2 – Lead Committee consider the details of the bill with great scrutiny & suggest any amendments • Stage 3 – Final consideration of bill by Parliament & a decision made whether to reject or pass.

After the bill is passed and it receives Royal Assent, it is then an Act of Scottish Parliament and a binding source of legislation.

Examples of such Acts are: Abolition of Bridge Tolls (Scotland) Act 2008.

The Scottish Parliament has power to produce legislation on devolved matters only. It does not have to consult Westminster or go through UK Parliament to pass new laws.

EU Law

Another binding source of legislation in Scotland is the European Union. The European Communities Act (1972) is an Act of Parliament which when passed the UK became members of...
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