When you have an intention to invest to a specific company or to prepare for Initial Public Offering, it’s indispensable to do Legal Due Diligence beforehand, to provide sufficient information for appropriate business judgment to decide whether to do investment or not.
Legal Due Diligence is the process of gathering, analyzing, and reviewing legal risks associated with the business. Even if the business is going well on its face, that’s not the only thing. The more you check, the more you will find out.
Legal Due Diligence is necessary to consider the new deal carefully before the investment and prevent future accidents beforehand. Legal Due Diligence includes checking registered information of the company, reviewing status of compliance in the industry, analyzing what’s happening in the company. Eventually, you could find out the status of the company from legal view points to improve company’s various aspects through Legal Due Diligence. This will help you to do decision making for your new investment and prevent you from inappropriate decision making for it.
Or if you are thinking about Initial Public Offering, your company will be reviewed by securities companies. Before their underwriting examinations, a law firm collects information which will be reviewed for those, analyzes those, and implements appropriate measures to deal with the issues. This will help you to have smooth procedures for your Initial Public Offering.
Especially, Regulatory Due Diligence is important when you commence your business or invest to new business. In case that your business is in highly regulated categories such as Pharmaceuticals, Finance, and so forth, you will face difficulty if you don’t know those regulations beforehand. Most of those regulations are stipulated in Japanese. Even for Japanese people, it’s not easy to interpret all of the regulations in Japan. For foreign investors, it becomes more difficult to do that since it’s very complexed sometimes.
That’s because it’s necessary to go into interpretation of laws, previous cases, precedents of Administrative Guidance and Administrative Disposition, and so forth to be familiar with those regulations. In case that you could not be complied with those regulations, Government might step into your company to investigate your company and implement appropriate measures to improve the situations after your investment. This could harm your company’s reputations and influence your business per se through media exposure or public announcement. You could have found a plenty of cases that happened previously to specific companies which did not comply laws and failed to have successful business. You have to avoid those situations.
Hattori Law has experiences to check and review various types of business, those regulations, and advise them to deal with legal risks associated with new business or investment.
We are ready to support your company’s future business in Japan or Initial Public Offering through Legal Due Diligence.