The Importance of Regulatory Compliance


Businesses, like all members of a democratic society, must operate within the bounds of the rule of law. For businesses, this means complying with government regulations that restrict such matters as company formation, the process of incorporation, employee relations, consumer-related regulations, taxation, and many specialized areas of regulation such as health regulations, environmental regulations, workplace safety laws, local zoning regulations, industry-specific regulations, etc. Lack of regulatory compliance can cause a business to be sued by the government, and can result in the business having to pay fees or be the subject of an injunction against operations that are out of compliance with government regulations, or both.

Before incorporating your business or beginning operations, it would be prudent to find out what regulations apply to businesses in your particular industry and in your geographic area. While some industries are very heavily regulated, other industries are less so. You will need to consult a lawyer who is familiar with your area and your industry. In addition, plan to keep a very organized set of business records and books.

Try to find out, as well, whether there are organized consumer groups who actively lobby for particular regulations related to your industry. Forewarned is forearmed when it comes to regulations that are in the works but that have not yet been signed into law. Moreover, you may choose to voluntarily comply with standards set up by consumer groups even if those standards have not become public law, simply so that you can make your client or customer base aware that your business has a policy of living up to the highest possible standards and maintaining the best industry practices possible. You may even want to consider partnering with or consulting with consumer activist groups, so that your business can cast itself in the role of community partner.

The regulations that govern your industry may seem overwhelming at first, but over time, you will probably find that operating within regulatory bounds and keeping track of changes in government regulations has become much more doable and reasonable than it initially seemed to be.



Disclaimer: My Corporate Services Inc. is a service company and does not offer legal or financial advice. ©, 2012 All Rights Reserved