Due diligence

Due diligence - this is a complex legal procedure checks, aimed at a comprehensive study of the company's compliance with current legislation.
The term Due Diligence emerged in the 30-ies of XX century in the United States. Originally, it meant the process of disclosure broker to the investor on the company, the shares of which were realized on the open stock market.
In our time, this concept has become quite broad. Today, the Due Diligence involves a comprehensive review undertaken to assess the various risks associated with investing. Usually, verification is done when considering the purchase and sale of shares in the business and the implementation of any business project. Sometimes the term is currently defined as a proper study, conducted by the parties concerned in the preparation of transaction documents in order to create a basis of trust as to the validity and completeness of the provisions of the documents and the facts contained therein.
The purpose of Due Diligence is analysis, allowing economic agents eliminate or greatly minimize the possible negative consequences of the bargain, and optimize business processes in the future activities of the company. Usually, this procedure is used in the following cases:
- purchase and sale of businesses;
- discovery activities abroad;
- joint ventures or accession of companies;
- providing evidence of the consistency of the foreign partner or investor;
- test the reliability and solvency of a counterparty;
- check for proper documentation during real estate transactions;
Due Diligence collect and take into account any information relating directly or indirectly to the company. At the same time the economic and legal documents, lawsuits, insurance policies, tax claims, criminal, administrative, investigative, environmental situation are analyzed, information and documents are requested in government agencies, registries, and other authorized bodies.
The result of the analysis is the conclusion of special experts. The form of this report may vary from the expanded (with a separate related documents, interim findings, sources of information, etc.), or in the form of brief advice on how to proceed. Our staff will be happy to assist you by providing advice on the development of optimal procedures of checking for your business.