The New York Law Blog: Partnerships/Joint Ventures Due Diligence for International Business JVs in New York, New Jersey & Connecticut: Partnership Law Updates
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Friday, May 27, 2016

Partnerships/Joint Ventures Due Diligence for International Business JVs in New York, New Jersey & Connecticut: Partnership Law Updates

We, regretfully, see too many New York, New Jersey and Connecticut residents entering into business relationships with foreign nationals and domestic corporations with little foresight.

The following Merger & Acquisition Due Diligence Checklist is intended as a guide to vetting a prospective partner/joint venture.  The list is not exhaustive and an experienced attorney is, normally, necessary to join your due diligence team.

Please don't chase an opportunity and not consider the risks.  The cost is, likely, less than you think and risks are, likely, greater than you think.

This New York-Focused Merger & Acquisition Due Diligence Checklist is not a substitute for retaining an attorney to assist with your M & A. Please, only, use this checklist as an initial guide and insure that your attorney is checking off all of the boxes.

If your prospective counterpart is an Asian-based company, these companies often are very poor at keeping accurate records that reflect a rational present reality.  This is, sometimes, caused by neglect and is sometimes intentional.  Please don't avoid a review of their partner company abroad.

Thus, it is essential to find a good Asian-based attorney that understands where to find the red flags. This skill comes with experience working in Asia.  If the attorney is not in Asia, the attorney will be unable to have the tools necessary to do a proper DD.  The flags our lawyers find in Korea, China, Southeast Asia are vastly different from the flags our lawyers find in New York, New Jersey and Connecticut.

M & A Due Diligence Checklist
  • Company History
    • Company History/Background
    • Founder, Family & Key Individuals in Company
    • Historical Profitability
    • Historical Client List
    • Credit Rating Present and Historical
    • Primary Present Customers, Suppliers & Vendors
    • Reason for Sale or Merger
    • Change in Present Market for Company
    • Stinky Fish & Stinky People
    • Old Hats
  • Financials & Shareholder Distributions
    • Audited Financial Statements
    • Tax Returns, Tax Certificates, Tax Filings & VAT, Sales Tax Receipts etc.
    • Government Filings, Government Notices and Tax Office Communications
    • Local Taxes & Communications
    • Compliance with local and international accounting standards
    • Insurances
    • Cash Flow, Current Financials & Year End Statements
    • Shareholder Distributions
    • Interested Transactions
    • Lawsuits by Shareholders
    • Government Liens
    • Liens & Attachments
  • Company Formation Documents
    • Business Licenses, Tax License & Commercial Register
    • Articles/Constitution, By-laws, Amendments etc.
    • Shareholder Agreements/Joint Venture Agreements
    • Government Approvals & Certificates
    • Interested Directors, Officers, Share Holdings
    • Representative Director & Directors Acceptance Documents
    • Formation Docs
    • Insurance Contracts
    • Seal Certificate
  • Assets & Receivables
    • Receivables List & Records
    • Real Property List & Records
    • Movables List & Records
    • IP (trademark, patents, copyrights, licenses etc.)
    • Registration documents for IP
    • Worldwide IP List
    • Contact for IP Manager
  • Liabilities & Lawsuits
    • Lawsuits & Administrative Actions
    • Government Liabilities
    • Loans & Guarantees
    • Interested Transactions
    • Licenses
    • Contingents
    • Liabilities to Shareholders, Employees, Family & Directors
  •  Customers & Relationships
    • Major Customers
    • Agreements & POAs
    • Customer & Vendor Relationship Issues
    • Customer Relationship with Key Employees Leaving
  • Employee/Directors
    • Employee List
    • Job Specs
    • Employment Contracts
    • Government Obligations
    • Severance Obligations
    • Director Contracts
    • Former Director List
    • Employees Terminated in Last Year
    • Independent Contractor Contracts
    • Employment Related Tax Obligations
    • Labor Union Representatives/Union
    • Disciplinary Dismissals
    • Contact for Human Resources
  • Real Property
    • Title, Lease, Property Records
    • Adjoining Landowners
    • Tax Assessment
    • Mortgages, Liens & Encumbrances etc.
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*Sean Hayes may be contacted at: SeanHayes@ipglegal.com.

Sean Hayes is co-chair of the Korea Practice Team and Chair of International Practice Group at IPG Legal.  He is the first non-Korean attorney to have worked for the Korean court system (Constitutional Court of Korea) and one of the first non-Koreans to be a regular member of a Korean law faculty.  Sean is ranked, for Korea, as one of only two non-Korean lawyers as a Top Attorney by AsiaLaw.  He has, also, received the highest rating by AVVO and other legal rating services.