British enterprise law concerns the ownership and regulation of organisations producing goods and services in the UK, European and international economy. Private enterprises are usually incorporated under the Companies Act 2006, regulated by company law, competition law, and insolvency law, while almost one third of the workforce and half of the UK economy is in enterprises subject to special regulation. Enterprise law mediates the rights and duties of investors, workers, consumers and the public to ensure efficient production, and deliver services that UK and international law sees as universal human rights.See the Universal Declaration of Human Rights of 1948 arts 21–27 on the right to participate in governance, social security, fair pay and work, health, culture, technology and communication. See further the International Covenant on Economic, Social and Cultural Rights 1966 arts 11–14. Labour, company, competition and insolvency law create general rights for stakeholders, and set a basic framework for enterprise governance, but rules of governance, competition and insolvency are altered in specific enterprises to uphold the public interest, as well as civil and social rights. Universities and schools have traditionally been publicly established, and socially regulated, to ensure universal education. The National Health Service was set up in 1946 to provide everyone with free health care, regardless of class or income, paid for by progressive taxation. The UK government controls monetary policy and regulates private banking through the publicly owned Bank of England, to complement its fiscal policy. Taxation and spending composes nearly half of total economic activity, but this has diminished since 1979.
Since 1980, a large segment of UK enterprise was privatised, reducing public and citizen voice in their services, particularly among utilities. Since the Climate Change Act 2008, the modern UK economy has increasingly been powered by renewable energy, but still depends disproportionately on oil, gas and coal. Energy governance is framed by statutes including the Petroleum Act 1998 and the Electricity Act 1989, which enable government to use its licensing powers to shift to a zero-carbon economy, and phase out fossil fuels. Energy ratepayers typically have rights to adequate standards of supply, and increasingly the right to participate in how their services are provided, overseen by the Oil and Gas Authority and Ofgem. The Water Industry Act 1991 regulates drinking and sewerage infrastructure, overseen by Ofwat. The Railways Act 1993, the Transport Act 1985 or the Road Traffic Act 1988, under the Office of Rail and Road, govern the majority of land transport. Rail and bus passengers are entitled to adequate services, and have limited rights to voice in management. A growing number of bus, energy and water enterprises have been put back into public hands, while in London and Scotland, railways may be wholly publicly run. While, post, telephones and television were the major channels for communication and media in the 20th century, 21st century communications networks have increasingly converged on the Internet. Particularly in social media networks, this has presented problems in ensuring standards of safety, accuracy and fairness in online information and discourse. Like securities and other marketplaces, online networks dominated by multinational corporations, have received increased attention from regulators and legislators as they have become associated with political crisis.
History
Aristotle, Plato, Roman law and the societas Otto von Gierke Magna Carta and Lex mercatoria Sidney Webb House of Medici, Medici Bank, Pope Leo X (1513–1521), Pope Clement VII (1523–1534), Pope Leo XI (1605) Thomas More, Utopia (1535) and John Locke (1689) Bank of England South Sea Company Port of London Act 1908 National Insurance Act 1911 Railways Act 1921 WA Robson, ‘The Public Corporation in Britain Today’ (1950) 63(8) Harvard Law Review 1321 Bank of England Act 1946 National Health Service Act 1946 Transport Act 1947 Electricity Act 1947 Gas Act 1986
General enterprise law
While the 20th century had seen swings from nationalisation and re-privatisation, a general law of enterprise developed where private ownership and markets were generally thought to work by themselves. On top of ordinary principles of commercial law, based on contract, property, tort, and trusts, four main fields of law settled the rights and duties of enterprise stakeholders. First, UK company law determines the constitution, governance and finance of major corporations. Much of the Companies Act 2006 concerns the duties of company directors, and the rights of members, who are usually registered as holding share capital. Equity investment mostly derives from people saving for retirement in mutual funds, life insurance and pensions. Second, UK labour law structures the rights of employees and their representative unions against the management of an enterprise. Employees are entitled to a minimum floor of rights, and to rights of voice through collective bargaining or occasionally votes at work in their enterprise. Third, competition law, which is closely coordinated with EU law aims to protect consumers' and the public interest in choice in markets, particularly where enterprise is privately owned. Fourth, United Kingdom insolvency law determines the relative rights of creditors when an enterprise can no longer pay its debts when they fall due. All enterprises are subject to general duties under UK environmental law and criminal law.
Corporate governance
Companies Act 2006 ss 21, 112, 168 and 284, company constitutions, amendment, voting rights and removal of directors Model Articles, Sch 3, paras 3 and 34, model articles for public companies Companies Act 2006 ss 170–177, 260–263 and 419 (directors’ duties, derivative claims, report) Pensions Act 2004 ss 241–243, right of pension beneficiaries to nominate pension trustees Charities Act 2006
Labour rights
Autoclenz Ltd v Belcher UKSC 41, minimum wage and working time claims Trade Union and Labour Relations (Consolidation) Act 1992 ss 179, 219, 224, 244 (collective agreements not legally binding, immunity from damages for collective action in contemplation or furtherance of a trade dispute, no secondary action, meaning of a trade dispute) ECHR article 11 National Union of Rail, Maritime and Transport Workers v United Kingdom ECHR 366, secondary action Health and Safety Executive
Competition and consumers
TFEU arts 101 and 102 Competition Act 1998 ss 2–3, 18–19 and Sch 3, prohibition of abuse of a dominant position and collusion TFEU arts 106(2) and 345, state aid and neutrality to public ownership Albany International BV v Stichting Bedrijfspensioenfonds Textielindustrie (1999) C-67/96 Public procurement State aid Consumer Rights Act 2015 Sale of Goods Act 1979 Consumer cooperative Consumer Protection Act 1987 Environmental Protection Act 1990
Insolvency
Insolvency Act 1986 ss 175-176A and Sch 6, preferential rights in insolvency for employees and pensions Re Spectrum Plus Ltd UKHL 41, interpretation of a ‘floating charge’ Insolvency Act 1986 Sch B1, paras 3, 14, 22 and 36, governance in administering insolvent companies
Specific enterprises
While many sectors of the economy function under general rules of enterprises alone, specific enterprise laws developed where "free markets" were seen as inadequate to protect consumer or public interests. In enterprises that concerned central social and economic rights, were "network" or "natural monopolies", for "public goods", or where significant capital investment was necessary, the UK law developed specific rules. Usually, a combination of public ownership, positive rights of voice for users or citizens, or sector-specific regulators emerged. These regulate the rights of exit, basic standards, and voice of stakeholders, beyond investors of capital or labour.
Education
The Universal Declaration, the International Bill of Human Rights and the European Social Charter say that "everyone" has the right to education, and that primary, secondary and higher education should be made "free",ICESCR 1966 art 13(2)(c), "Higher education shall be made equally accessible to all, on the basis of capacity, by every appropriate means, and in particular by the progressive introduction of free education". UDHR 1948 art 26 "free, at least in the elementary and fundamental stages" and "higher education shall be equally accessible to all on the basis of merit." in particular "by reducing or abolishing any fees or charges" and "granting financial assistance".European Social Charter 1961 arts 7, 10 and 17. cf ECHR 1950 Protocol 1, article 2 and the Belgian Linguistic case (No 2) (1968) 1 EHRR 252. CFREU 2000 art 14. Historically, the UK guaranteed free childhood, higher and adult education, and gave grants until the late 20th century. However, it maintained a private fee-paying school system, dependent on parents paying money (also called "private" or "public" schools, after the Public Schools Act 1868). Following this model, the Teaching and Higher Education Act 1998 re-instated tuition fees for university. Although the evidence suggests that fees deter and disadvantage poorer people,M Hübner, ‘Do tuition fees affect enrollment behavior? Evidence from a ‘natural experiment’ in Germany’ (2012) 31(6) Economics of Education Review 949. C Callender and J Jackson, ‘Does the Fear of Debt Deter Students from Higher Education?’ (2005) 34(4) Journal of Social Policy 509. L Dearden, E Fitzsimons and G Wyness, 'The Impact of Tuition Fees and Support on University Participation in the UK' (2011) IFS Working Papers W11/17 university fees were raised to £9250 a year from 2017 in England and Wales. Scotland remained tuition free. University and school finance and governance remains a patchwork system across the UK, without any coherent approach.