Do you need a lawyer to help you sell or buy a business
Written on the 8 December 2021 by Busijness Atricles
Buying a business or franchise involves many aspects which you may be unaware of. A lawyer will protect your interests, assisting you in ensuring all important points are covered off and all legal requirements are satisfied.
Buying a business
When purchasing a business, your lawyer will:
assist you in completing due diligence checks on the business;
arrange for title searches of any property to confirm the true proprietor and reveal any mortgages;
arrange for company searches of the vendor company to reveal any charges over the company assets which you may be purchasing;
arrange to search rates certificates to ascertain whether the rates have been paid as disclosed by the vendor;
arrange to search Vehicle Security Register to reveal the title and registration of any vehicle you may purchase as part of the business;
review your contract to ensure it adequately protects your interests, and will negotiate for the inclusion or removal of clauses as necessary;
assist you in identifying, protecting and registering your intellectual property;
advise you in relation to dealing with employees whether they are transferred from the previous business owner, terminated or new;
provide advice on any further obligations you may have such as transferring the business name to you, registering for an ABN or for GST. They will acquire the necessary licenses or permits to run the business, ensuring compliance with any obligations you have;
provide advice on effective business and corporate structures;
provide advice regarding finance options.
Buying a franchise
When buying a franchise, in addition to the functions outlined above, a franchising lawyer can assist you with the following aspects:
reviewing your Franchise Agreement and any additional documents, advising you of your rights and obligations under each;
ensure the disclosure document provided to you complies with the Franchising Code of Conduct;
advise you in relation to effective ownership structures;
advise you in relation to any negotiations or disputes with the franchisor;
ensure the franchisor's procedures and requirements do not breach Trade Practices law;
reviewing and advising you on any lease, sublease or occupancy licences;
advising you in relation to employment matters.
Once you have done the groundwork, investigated several types of businesses and decided on the business you wish to buy, you should contact a lawyer.
Ideally, you should consult a lawyer prior to signing any documents committing you to anything. This gives your lawyer the opportunity to assess all elements of the proposed transaction and advise you accordingly. It also gives you the opportunity to 'back out' if you discover something unexpected or unfavourable.
However, even if you have already executed a contract or other document, your lawyer can still assist in giving you a better understanding of what the transaction will involve and will help you to best protect your interests.
