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The Difference Between Corporate Law and Commercial Law Explained

by Charles Nwabueze
Reading Time: 6 minutes

Why Knowing the Difference is Important?

Quite often those unfamiliar with the law will often use ‘commercial law’ and ‘corporate law’ interchangeably. It is not only those who are unfamiliar with the law that falls into the trap of using those words interchangeably as students, graduates and even some lawyers do use them interchangeably. Thus if you are one of those people you should not feel bad as you are not alone.  The reason people use corporate and commercial law interchangeably is that these two terms are closely related. But we must state that despite their closeness they are two entirely different practice areas that govern different aspects of a business or company’s operations.

You might start thinking if they both have to do with companies and are closely related, what is the purpose of this article? Why do I have to read this article? And that is where the importance lies. You need to read on because depending on the law firms you are applying to, you will be usually asked questions such as ‘why do you want to be a commercial lawyer’, ‘why do you want to practise corporate law’ or ‘why are you interested in a corporate law firm like us’. Through your understanding of the difference between the two practice areas, you will be able to recognize what the law firm is looking for in your answer. Simply put, by understanding the key differences your application will be richer in quality. Subsequently, this article takes a close look at these two areas of the law. By explaining what each of the practice areas is, and breaking down the key differences between both terms, including the salary that pertains to each of them we’ll give you a clearer picture of why they’re not quite the same thing.

What is Corporate Law?

Corporate Law or Corporation law refers to the body of laws, regulations, rules, and practice directions governing how corporations are formed. Corporate law often describes the law relating to matters which derive directly from the life cycle of a corporation. It thus encompasses the formation, funding, governance, operation and death of a corporation. Corporate law is also a body of laws that provides and governs the rights, relations, and conduct of persons, companies, organizations and businesses.

Any legal entity (corporation) that conducts business will be governed by corporate law. Since corporate law governs corporations, what is a corporation? A corporation is a business entity that is owned by its shareholder(s), who have or elect a board of directors to oversee the organization’s activities. There are different types of companies in the UK, but they all usually have to be incorporated at the Companies House under the Companies Act 2006 – one of the cornerstones of company law in the UK. Other important laws in this practice area include the UK Corporate Governance Code and The Insolvency Act 1986.

Again corporate law encompasses all the legal issues that a corporation can face. As such corporate lawyers are the elite of the elite. Think of all the big companies – the Apples, the Amazons, the Microsoft – all of them need corporate lawyers. Consequently, in the world of law – in the world of the City (London), in the world of the UK, in the world of Europe, in the world of America, in the World – it does not get bigger than corporate law. Some of the biggest firms in this area include:

  • Freshfields Bruckhaus
  • Linklaters
  • Slaughter and May
  • Clifford Chance
  • Skadden
  • Blackstone Chambers
  • Brick Court Chambers
  • Essex Court Chambers
  • Allen & Overy

What is Commercial Law?

Commercial law or sometimes referred to as business law is that body of law that regulates the conduct of persons, merchants, and businesses who are engaged in trade, sales, and commerce. Essentially, commercial Law is a term used to describe the legal services provided by lawyers to support their clients’ businesses in making money from their products and services. That commercial law offers services to help businesses make a profit does not mean consumers are neglected; commercial law also covers consumer protection and even employment contracts. Consequently, commercial law is a broad area of law that interacts with many other areas of law such as intellectual property, real estate, banking & finance, bankruptcy, tax and environmental laws.

The broadness of commercial law is also what makes it different from other areas of law. There is no other area of law that cuts across every other practice area. No matter the industry or practice area you may think of whether it is tech or intellectual property, commercial law is involved. Some of the best commercial law firms in the City (this is not to say that there are no top commercial firms outside the City) include:

  • Baker & McKenzie
  • Freshfields Bruckhaus Deringer
  • Linklaters
  • Kirkland & Ellis
  • DLA Piper
  • Berwin Leighton Paisner
  • Bird & Bird
  • Hogan Lovells
  • Norton Rose Fulbright
  • Travers Smith

What are the Main Differences?

First, the most important difference lies in their definitions. Corporate Law refers to the body of laws, regulations, rules, and practice directions governing how corporations are formed. Thus corporate law has to do with all the matters that derive directly from the life cycle of a corporation. What this means is that when you are talking about the formation, funding, governance, operation (including the rights, relations and conduct of persons involved with the corporation) and death of a corporation, you are talking about corporate law.

On the other hand, the commercial law practice area deals with the regulation of the conduct of persons, merchants, and businesses who are engaged in trade, sales, and commerce. Thus, if you take part in a commercial seat or become a commercial lawyer, the services you will be providing will be tilted to providing support to your clients’ businesses in making money from their products and services. So you will be the one looking at how the law impacts your client’s business in its various activities.

Another fundamental difference is in the knowledge required to serve in both practice areas. While no one will argue that corporate law is not important, it is important to note that seeking to practise the law will primarily need to have a narrower base of knowledge than those in commercial law. This is because what corporate lawyers are fundamentally concerned with is how corporate law affects corporations at every point of their lifecycle. So some of the areas they need to know about which are still under corporate law include incorporation & formation of a company, restructuring & reorganization, M&A and raising capital. Conversely, If you are working in commercial law, you will be required to have a broader knowledge base than those working in the corporate practice area. This is because commercial lawyers look at the whole picture of making sure that all aspects of their client’s businesses run smoothly; meaning that quite often several various areas of law will be involved in the day-to-day work of a commercial lawyer. Some of the areas commercial law covers include contract law, consumer law, intellectual property law, media law, tax law and employment and labour law

The Salary: Commercial vs. Corporate law

Commercial and corporate lawyers are some of the best-paid in the country. They earn a killing as both practice areas offer some of the best-paid careers in the UK. According to, the average salary for a corporate Lawyer is £78,400 gross per year or £4,500 net per month, while the average salary of a commercial lawyer is £66,300 per year or £3,920 per month. At face value, it does appear that corporate lawyers earn more than their financial counterparts. But this is not always clear-cut because corporate law and commercial law are often practised by one firm with the same set of lawyers. For example, if you get a training contract at a top firm with both a corporate law practice and commercial law practice, the salary you will be given will be comparatively similar to what a trainee is getting at a top firm solely involved with either corporate or commercial law. But if the salary matters to you, then corporate lawyers edge commercial lawyers in terms of pay.


If you have followed what we have written in this article, you’ll have discovered that there is an overlap of firms that both have a strong foot in both commercial and corporate practice areas. That this is the case does not mean you should fall into the trap of thinking that is the same thing. The benefit of this article is that with the information it has provided, you should be better placed to tackle application questions dealing with each of the terms.


Charles is a writer, practising lawyer and personal trainer who loves learning and developing himself. He graduated from Middlesex University, London with eight first-class grades in the second and third years of his law degree, and received a postgraduate offer from Cambridge University. He loves strength training, boxing and encouraging people to succeed in their pursuits (legal ones)
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