Inter Relationship of Economic, Political and Legal Systems

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Thank you for downloading this extract from our ExPedite notes to accompany your free online “Course in a Coffee Break”. To download a free complete set of our ExPress notes please visit www.theexpgroup.com. Good luck with your F4 studies.

ACCA Paper F4
Corporate and Business Law
For exams in 2010

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ACCA F4 Corporate and Business Law

ExPedite Notes

Chapter 1

Economic, Political and Legal Systems

The examiner has stated that in the exam, you may be required to:     

Explain the inter-relationship of economic and political and legal systems (application level). Explain the doctrine of the separation of powers and its impact on the legal system (application level). Differentiate between different types and different systems of law (knowledge level). Explain the distinction between criminal and civil law (knowledge level). Outline the operation of the following legal systems (application level): i) Common law ii) Civil Law iii) Sharia law.

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ACCA F4 Corporate and Business Law

ExPedite Notes

Economics and Politics The decision whether a country‟s economy is to be a free economy, planned economy or mixed economy is a political decision. The legal system has an important role in supporting the economic system in a number of ways, such as:    Requiring and providing compulsory education Protecting property rights of companies and individuals Providing legal certainty and constraints under which business operates.

Separation of Powers Separation of powers means dividing the instruments of government into three separate and equally strong components, ensuring that no one branch of government can effectively govern without the others. This prevents an excessive concentration of power building up in the hands of one person or a small group of people. The three branches of government are the legislature, the executive and the judiciary.

The Legislature

This is the body within the constitution in which the power of making law is located. Such law takes the form of legislation. Under democratic constitutions the body will normally be elected. In countries with a written constitution there are limits to the power of the legislature to make law, in that it is not permissible for laws to be made which conflict with the rights provided under the constitution. If any such law is passed, it is open to challenge in the courts, which may strike it down as being unconstitutional. In a law with no written constitution such as the United Kingdom, the legislature functions under the doctrine of parliamentary sovereignty. This effectively means that parliament is not just the ultimate source of law, but it can make such law as it determines, which cannot be challenged in the courts as to its content. Where parliaments in countries without written constitutions pass laws that seem to limit the scope of future parliaments to do as they wish, such as voluntarily binding themselves to the supremacy of EC law or the European Convention of Human Rights and Fundamental Freedoms, the courts cannot declare primary legislation to be invalid on the grounds that it conflicts with...
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