Nath Solicitors helps businesses get off the ground. We work with businesses, owner-managed enterprises and larger companies in London and elsewhere providing legal advice when it’s needed most. We have provided support to many of our clients from their inception, helping to foster growth and consolidate their market positions with robust and practical legal solutions. Here are five things you should think about from a legal perspective when you are starting a new business. For further advice please call us on +44 203 670 5540 or +44 (0) 203 670 5540 or contact us online.
- Get the structure right – Choosing the right legal structure for your start-up is crucial. It will determine the way you pay taxes, buy and sell services and outline the responsibilities of key individuals within the organisation. Generally businesses begin life as one of the following:
- A business
- A limited company
- A limited liability partnership
Before deciding which structure is best for your business you should think about how much control you want to have over the running of the business, what legal liability you are willing to shoulder, administration costs and how flexible you want the management of the business to be.
- Protect your assets – With new businesses your ideas and the way you approach things are often your most valuable asset. It is essential to proactively protect your intellectual property and other commercial assets. This means registering trademarks where appropriate and monitoring what others, including your competitors are doing. When you buy something from a third party ensure you are also purchasing any copyright or other rights over it. You should also have systems in place to act quickly if a third party infringes your rights.
- Put agreements in writing – It may be tempting to undertake work or provide services on an informal basis when starting out. All business is welcome of course. But our experience as commercial contract solicitors over many years has shown the dangers business expose themselves to when not recording responsibilities and obligations in a contract of some kind.
- Have a comprehensive shareholder or other agreement – Whether you are starting a limited company or your business is structured in some other way a comprehensive agreement is essential. This might be a shareholder agreement, a partnership agreement or some kind of joint venture document. Even though it’s hard to envisage disputes when you are starting out, they do happen. And the can be hugely damaging to your commercial interests and day-to-day operations. A shareholder agreement will set out what happens when there is a disagreement. It may also reduce the potential for dispute because it will specify how you and your fellow directors or partners will take decisions and manage the business. For companies, an agreement can also determine how and when shares can be sold and include built-in protections for different classes of shareholder. It also shows outsiders and potential investors that you are a well-run enterprise that has planned for the future.
- Find professional advisors you can trust – We believe that businesses supported by expert professionals have a competitive edge. It might involve an investment in terms of fees. But it is a sensible move. Trusted lawyers, accountants and tax specialists that understand your business can provide invaluable support and guidance when the unexpected happens. They can also ensure you meet your legal responsibilities and are compliant with relevant regulations in areas like employment and data security.
When starting a new business it’s easy to rush headlong into it without considering the legal implications of how you are going to run things in the long term. There is a lot to be gained from standing back, getting the right advice and putting your business on a sound legal footing – from the beginning. For more information you can call us on + 44 203 670 5540 +44 (0) 203 670 5540 .
