What is Legal Due Diligence?

     

       Legal Due Diligence is the legal review process, which is a part of the overall Due Diligence procedure for business evaluation based on the client's objectives. Due Diligence typically consists of Financial Due Diligence, Legal Due Diligence, and Operational Due Diligence.

       Legal Due Diligence primarily focuses on reviewing tax matters and assessing whether the business is at high risk of litigation, especially regarding environmental impact. This information is crucial for economic decision-making, particularly for those interested in acquiring or investing in a business, as it may affect operations and investment capital.

       Moreover, Legal Due Diligence also covers the examination of existing contracts the business has with external parties and internal employees. For example, it aims to identify any obligations or liabilities that may arise from contracts or agreements entered into by the company’s management. Such obligations might have long-term effects and should be known by prospective buyers of the business.

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