Overview

Businesses operate within a web of federal, state, and international regulations designed to protect consumers, employees, competitors, and the environment. This topic surveys key regulatory frameworks—from antitrust to product liability—and highlights corporate ethics and social responsibility obligations.

Key Concepts

• Corporate Ethics: Codes of conduct, fiduciary duties, whistle‑blower protections (Sarbanes‑Oxley).
• Social Responsibility: ESG reporting, stakeholder theory vs. shareholder primacy.
• Administrative Agencies: Rule‑making and enforcement by FTC, SEC, OSHA, EPA, and CFPB.
• Antitrust Law: Sherman Act §1 (collusion) & §2 (monopolization), Clayton Act (mergers), FTC Act (unfair competition).
• Employment Law: Title VII, ADA, FLSA, FMLA, and NLRA—discrimination, wages, labor relations.
• Product Liability: Negligence, strict liability, breach of warranty under UCC §2‑314/315.
• Consumer Protection: Truth in Lending (TILA), Magnuson‑Moss Warranty Act, state UDAP statutes.
• International Business: CISG for international sales, export‑control laws, FCPA anti‑bribery rules.

Step-by-Step Example

Scenario: A tech firm advertises a smartphone as “waterproof to 3 meters,” but devices fail after minor splashes. The FTC investigates.

Step 1 – Agency Jurisdiction: FTC can pursue deceptive advertising under §5 of the FTC Act.

Step 2 – Proposed Order: Agency issues consent decree requiring accurate labeling and $10 million restitution fund.

Step 3 – Product Liability Exposure: Consumers file class‑action alleging breach of express warranty and strict liability design defect.

Step 4 – Mitigation: Company initiates voluntary recall compliant with CPSC guidelines and updates marketing claims.

Answer: Regulatory enforcement and private product‑liability suits can operate in parallel; prompt corrective action and clear warranties limit damages and rebuild consumer trust.

Quick Tip