Starting or restructuring a company is a big legal commitment. It needs to be done correctly to avoid penalties, fines, and lots of expensive work to undo any errors. The first step is to contact an Auckland company formation lawyer to get good advice before it is too late. Below we look at some of the key services that they offer.
Forming a Company
Many people have a dream of starting their own business. Most of these people have an idea or a skill that they want to make money from. They are largely uninformed about running a business, and even less so about the legal issues involved. Is it surprising that so many start-ups fail so quickly?
Talking to an Auckland company formation lawyer is possibly the best move that anyone can make before they even start discussing the business case for their idea.
They can explain the types of business they could start, and the associated legal and financial requirements for each.
Business Structure
A good company formation lawyer in Auckland will explain the different options that entrepreneurs have.
There are four basic types of business:
Sole trader
Partnership
Limited Liability Company (LLC)
Trusts
Each has different requirements from the owners and managers. This can be in relation to tax treatment, reporting, governance, and regulatory requirements. They also give different levels of protection or risk to the owners.
It is vital that any business owner understands the implications of the business structure to themselves, their other investors, management needs, and financial planning. These include eligibility, disclosure obligations, and ongoing duties under the Companies Act 1993
Forming a Company in New Zealand
After agreeing what structure the business will take, the company formation lawyer will get to work actually creating the business and filing the required documents with the New Zealand Companies Office.
There are a few tasks involved including:
- drafting the company constitution,
- shareholder agreements,
- director consent forms, and
- the company registration details are accurate.
Compliance
This is another critical area once the business has been registered and been trading.
Your company formation lawyer will explain your obligations for filing annual returns to the Companies Office. Other obligations involve financial reporting and maintaining statutory records such as holiday and PAYE records for employees.
If the business trades overseas, there are other requirements too. For example, Anti Money Laundering (AML) processes, cross-border compliance i.e. what do export governments want to see?
What implications there might be for foreign shareholders or directors, and overseas tax considerations.
All of this is necessary to make sure that the company operates within New Zealand law and avoids penalties or risk to their reputational.
Ongoing Legal Advice
Hopefully, your business will grow over the years. That can mean different types of legal advice for example, if you and the other directors decide to switch from a partnership to an LLC. You will need to talk to your legal team about the implications of such a decision.
Other Legal Services
Once your company has been formed, you will need some additional legal services. These include:-
- drafting your contracts or terms of trade
- employment agreements
- reviewing contracts offered to you
- commercial leases for premises
- trademarks
- intellectual property protection
- patents, and more.
No doubt, at some stage there will be a dispute of some kind. Disputes vary from:
- customer issues
- disagreements between shareholders
- contractual issues
- employee issues
- and more.
During disputes, your lawyer, or a dispute resolution specialist, can advise and work for you. The help can include negotiations with other parties, or mediation. If necessary, they can represent you in any court proceedings.
Exiting the Business
At some stage, the owner, or one of the shareholders will want to exit the business. Clearly this is not immediately related to company formation, but the exit strategy is one of the earliest topics a good lawyer will discuss with you.
They can advise on ways to exit the business which could be:
- franchising
- licensing
- joint venture agreements
- sale
- winding up
Each of these has different legal issues, and a good lawyer will work with you from the start, the company formation, to the end, or how you exit the business.
In Summary
An Auckland company formation lawyer will get your business set up for you in a way that suits your ambitions, and expectations. They can also offer you and end-to-end, whole-of-life range of services from the set up to the exit, whatever form that might take.
Given the range of services, and hence, different expertise that you will need, it is a good idea to choose a bigger law firm that has a team of lawyers who can support you in whatever issue you may encounter. McVeagh Fleming is one such law firm in Auckland CBD. They have experienced lawyers in most forms of the legal field. You can find more details about their company formation lawyers in Auckland, and their other services.