Two of the focuses of my blog are Financial Literacy/Money and Business/Entrepreneurship. For anyone unfamiliar with the business world, it is closely intermingled with the legal world. In fact, most successful businesses have a strong legal component. To not have one is literally flirting with catastrophe. The following contributed post is entitled, Importance Of Law In Business.
* * *
Every business owner, whatever their area of business, naturally exposes himself to legal risks during their business activities, so he is required to build a proper legal envelope that will protect them and their business, reduce risks and avoid unnecessary expenses and damages in the future. Here are some important tips that will help business owners identify the relevant potential issues in their business activities.
If the business operates as an authorized dealer, it must be examined how the business owner’s exposure can be minimized in the face of potential lawsuits or legal proceedings. If the business is run as a partnership, it is important to draw up a partnership agreement that will regulate the relationship between the partners, their rights and obligations towards each other and towards the partnership itself. If the business operates within the framework of a limited company in which there is more than one shareholder, it is very important to draw up a founding agreement which will regulate the legal relationship between the shareholders themselves and the company. Law is vital for any business, therefore, seek out a great team and be educated on employment law.
Every business that provides services to customers must have a quotation document/ contract agreement that regulates, among other things, the legal issues between the business and its customers. It is also very important to draw up agreements that determine the business’s relationship with external parties with whom the business works on a regular basis, such as: employment agreement (mandatory by law), service agreements, supplier agreements, cooperation agreements, franchise, license agreements, marketing and more.
Maximum protection of the intellectual property of the business and its owner: One of the significant, important and valuable assets for the business and its owner is its intellectual property which is reflected in the copyright (eg works, collections, articles, designs, photographs, software, source code, applications, methods and more) as well as in its trademark which symbolizes the unique brand the business has gained a reputation for and sets it apart from the rest of its competitors. Therefore, it is of utmost importance to protect these rights as soon as possible by registering them in your city or abroad and anchoring them in appropriate agreements when there are agreements with third parties.
In the case of a unique and innovative venture in its infancy, it is important to draw up a confidentiality agreement tailored specifically to the relevant venture and to sign all the parties exposed to the idea. It is also important to draw up contracts related to the enterprise’s platform.
Proper conduct in collecting payments from customers: It is very important to make sure that each customer signs a quote or demand for payment (also on a tax invoice that constitutes a demand for payment) and makes sure that there is a full signature. Any written commitment of the client by email, notices, watts-up or anything similar should always be kept to ensure a strong paper trail and to allow you the justice you deserve, if something goes wrong.