Integrated way of doing business from a legal perspective
Setting up and running the business in correlation with the positive legal norms and the interests of the business has a crucial importance for its long-term sustainability and fluent functioning. Practical experiences show that predicting, preventing and mitigating potential problems that inevitably arise in daily operations is of crucial importance for the development, and sometimes for the very survival of the business. In this direction, we will point out some key settings that every entrepreneur should pay attention to, for which experiences show that an integrated approach is not always taken, but a selective approach is often observed.
- Correct placement of the provisions of the act of incorporation of the entity.
- Registration of industrial property rights.
- Correct placement of labor relations and meaning of the employment contract.
- Establishment of debtor-creditor relations and the importance of timely reaction and active monitoring of the collection of claims.
- Knowledge of tax regulations.
Our experiences in the daily work of the legal profession and providing legal assistance to our clients indicate that these five issues are the source of over 90% of the problems our clients face, i.e. they arise as a result of an isolated or incomplete approach to solving them. In the following, we will briefly review these issues.
The act of incorporation, i.e. the founding act of the company is extremely often put in the background, i.e. almost all trading companies use “copy-paste” provisions when establishing the companies, without emphasizing the specific needs, vision and business development plan . The significance of the provisions of the founding act becomes especially important when the companies are founded by two partners with equal founding capital “50%-50%”, so inevitably in the operation of the company they are faced with the moments of decision-making, evaluation of the right to vote , the right to distribute the profit, the right to distribute the mass in case of closing the company, determination of potential limitations in the management of the company, etc. The correct setting of the basic questions for the internal functioning of the company is the basis for fluent operation in the company’s external relations, especially in these situations, because such a setting “50%-50%” can be “devastating” for the company and lead to the impossibility for decision-making due to the equality of partners.
In the following, we will follow up on the necessity of registering industrial property rights, for which a large number of businesses are not aware of the significance of these registrations. Here, we will highlight the importance of the trademark as an industrial property right that is most frequently subject to registration and every legal entity should have this registration done in order to protect its economic interests when operating in the legal market. Trademark registration gives exclusivity when using a certain sign, that is, a certain brand by which the trading company or the products/services it markets in the legal market will be recognized by customers. The lack of such registration always leaves room for abuse of the brand by a third party who can at a certain stage appear in the legal market with the same brand and “take away” part of the market or cause confusion among consumers by marketing products with the same brand. brand, and with a much worse quality, which leaves long-term consequences for the perception of the brand among consumers, and consequently causes enormous economic consequences. In addition to the trademark, we will only mention the rest of the industrial property rights, i.e. the patent, the industrial design, the mark of origin and the geographical mark.
In addition to these basic issues that are subject to registration, the relationship between the company and its employees is extremely important. The basic act for establishing an employment relationship in which these issues are regulated is the employment contract, which we can also say is often concluded in practice according to a “template”, without detailed elaboration of each specific bilateral relationship with each employee. This contract, in correlation with the positive norms of labor law, generates rights and obligations for both parties that should be approached extremely carefully, because the impossibility of fulfilling them often entails court proceedings that lead to unplanned costs in the company’s operations and unproductive working hours spent.
A careful approach when entering into bilateral relations is extremely important in debtor-creditor relations as well. Knowledge of the other party and knowledge of the market are the two basic information for correct decision-making when entering into a certain debt-creditor relationship. Unfortunately, the daily filing of court proceedings for the collection of claims in our office indicates that insufficient emphasis is placed on these issues, which consequently have serious consequences in the liquidity of the companies’ operations, which is why we appeal for a careful and professional approach to these issues, in cooperation with professionals, because the consequences of recklessly entering into these relationships often lead to over-indebtedness and termination of businesses through bankruptcy proceedings. In this direction, how to avoid potential problems with the state institutions for regulation of public revenues, inspections, etc. we appeal to a careful and professional approach in the tax operations of companies.