Capital markets law governs how companies can raise money and use the money they raised. It aims at eliminating fraudulent ways of raising capital. Capital markets law slightly varies from one country to another; however, the main focus remains professionalism. Capital markets lawyers are there to advise corporations on these laws.
For a business to succeed, it must have adequate capital. The capital needed can be raised through various means such as contributions by shareholders and through issuing shares and bonds. The raised money can be used to expand the business in newer territories, pay worker or to acquire machinery. Capital markets law requires companies to clearly state the intention of the capital raising process. The companies are also required to use the capital raised as was planned, failure to which will lead to prosecution.
Capital markets laws appreciate the hard work investors have put in to get the capital that they invest in companies. It also recognizes the presence of fraudulent managers. It, therefore, clearly spells what is all managers are expected of. These set rules ensure that the exposure of investors to fraudulent activities by managers is minimal.
A typical capital raising process takes weeks to finalize. The duration and process set by law may very depending on industry and geographical location of the company. However, the capital markets laws insist on having the process monitored by the market regulator. The law also requires the process of raising the capital to be thoroughly investigated to eliminate loopholes.
During a transaction, the number of lawyers monitoring the process can vary from a small group of capital market lawyers to a very large group. The group of lawyers is usually made up of partners, lawyers and even trainees. They go through every document of the transaction, while referring to the existing laws, to ensure no part of the documents go against the laws.
There are four main laws that govern capital markets. These are contract law, tax law, financial regulatory law and European law. A good capital markets lawyer such as Sam Tabar has in-depth knowledge of all the four laws. Sam Tabar is also a committed lawyer with intellectual rigor and energy. This has made him a very important capital markets lawyer in the United States.
Capital Market law is important and should always be followed to the letter. A good lawyer will help his or her employer to achieve this. This will save the corporation from court battles that may lead to millions of dollars in fines.