What are the latest laws impacting South Carolina business owners?
In an interesting turn of events, the South Carolina legislature passed a law in early June, 2015, prohibiting the state from entering into a contractual relationship with any business actively engaged in certain types of boycotts. The legislation is unique in that it works to deter or dissuade small businesses from engaging in discriminatory conduct, even when such conduct is less obvious or overt to the general public.
Under the provisions of Section 11-35-5300 of the South Carolina code, the term “boycott” is used to refer to a business decision rendered by a corporation that involves “blacklisting” or divesting from a certain person or corporate entity for a specific reason. Under the new law, South Carolina public entities and agencies are prohibited from entering into a contract with any private sector entity that actively decides to boycott another business or person based on that entity’s race, color, religion, gender, or national origin.
For many small businesses, choosing not to work with a certain individual or entity is a natural component of the free trade experience. For these reasons, the legislature added to the bill the caveat that the term “boycott” is not defined to include any decision based solely on economic factors or the specific conduct of a member or director of an entity. Likewise, the bill contains an exception to the boycott rule when a divesture is applied against “a public entity of a foreign state when the boycott is applied in a nondiscriminatory manner.”
As a South Carolina business owner, it is important to understand the pivotal distinction between a lawful boycott, and one that could cost your business lucrative government contract revenue. Keep in mind that your board is well within its rights to make a calculated economic decision not to work with a certain entity or individual, provided the decision is not based on any discriminatory motive whatsoever.
If you are concerned with corporate compliance and would like to speak with a reputable Florence and Myrtle Beach business and corporate law attorney, please contact Willcox, Buyck & Williams by calling (843)461-3020 right away.