Political and Legal Change

• Legislation


  Creating and enacting laws in order to protect individuals, businesses and society as a whole
• Legal Environment


  The collection of legislation that impacts on the activities of organisations
• Laws are passed through UK Acts of Parliament
• Competition Law


  Looks to promote fair competition in markets and stop the abuse of consumers by businesses due to monopoly power
• Anti-competitive practices such as price fixing between businesses are illegal
• Mergers and takeovers are monitored and will not be allowed if it is deemed that they significantly reduce competition
• Markets that are not competitive will be investigated
• Firms are not allowed: Agree prices with competitors, limit production in order to reduce competition, partition markets or customers between each other
• Competition Policy


  Seeks to improve the competitive nature of markets
• Competition Policy


  Seeks to alleviate market failure in order to protect the interests of consumers and society as a whole
• Competition Policy curtails monopoly power and protects competitive markets
• Competition Policy restricts mergers and prohibits cartels, where business group together in order to regulate supply to markets
• Monopoly exists when there is only one business in the market
• Any business with at least a 25% market share is considered as having monopoly powers
• Monopolies can exploit consumers by charging high prices
• Benefits of Competition Policy:

  Lower Price

  Improved quality

  Increased choice

  Innovation

  Competitive advantage
• Labour Market Law


  Safeguarding employees rights in the workplace
• Examples of labour law:

  Equal Pay Act

  Sex discrimination Act

  Minimum wage Act
• Labour market law is designed to protect the worker from discrimination within the workplace and to make it easier for businesses to recruit workers
• Environmental Law


  Legislation designed to influence the behaviour of individuals and businesses in order to reduce the negative impacts on the natural environment
• The Government look to promote enterprise in the economy as it creates jobs and leads to economic growth
• International trade is the exchange of goods and services between countries