For a country, it is of utmost benefit to host hordes of startups because it enhances the economic development of the host country and creates more jobs for her people.
However, it is important that entrepreneurs note that setting up new businesses comes with several legal implications.
The points here shed light on a couple of legal considerations a startup owner must understand.
It is important that startup owners know and abide with the laws and regulations governing the industry that operate in, and ensure compliance with same.
It is the practice that every industry has regulations governing it and new companies must fully comply with those regulations. For safe measure, startups usually employ a compliance officer (usually a lawyer) to ensure that the business is on the right side of the law.
New startups must also pay attention to intellectual property assets.
It is very important for businesses to protect intellectual property. It could be in form of trade secrets, trademarks in logo, brand names, symbols, copyrights, etc. Startups must register intellectual property assets with the relevant agencies in other to protect these assets and get due compensation when infringements occurs.
Also, in the course of doing business, startups will enter into diverse relationships that would need contractual documentation.
It could be with employees, clients, vendors, creditors, investors, etc. It is important to ensure that all agreements are written not oral. It is also advised that the services of an experienced lawyer is retained, for the purposes of drafting contracts, reviewing contracts, and providing legal advice where necessary.
Startups must understand the legal implication of every business decision made. For example where a potential investor is interested in acquiring some shares in a startup or where a party is interested in partnering with a startup, the founder(s) must seek expert legal advice before committing to such decisions.
The foregoing are some of the critical legal issues that an entrepreneur must bear in mind when setting up a business.
It is a common place to find passionate entrepreneurs think that they can start up a business without proper legal consultation.
Entrepreneurs must invest in legal expertise to avoid setbacks that might frustrate their businesses.
This post highlights the legal implications of setting up a startup.
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