LEGAL AUDIT OR DUE DILIGENCE OF BUSINESS IN ITALY

Legal due diligence is the process of gathering, understanding and evaluating all the legal risks involved during the M&A process. During due diligence, the buyer reviews all documents related to the target company and interviews people associated with it.

Legal due diligence typically includes investigations into the following areas: corporate, commercial contracts, employment, intellectual property, information systems, environment, health and safety, regulatory compliance, competition, litigation, property and tax.

Legal analysis and verification of the company in Italy includes the following provisions:

• Research of share capital, its structure and corporate documents,
• Analysis of personnel and relevant documentation in the personnel field,
• Verification of compliance with the legislation and policies of the country, including GDPR,
• Analysis of business contracts and counterparties,
• Verification of the legal status of property, funds and other assets of the enterprise, as well as the presence of intellectual property and its protection,
• Checking the presence or absence or status of courts or criminal or administrative disputes.
• Compliance with environmental standards.

Depending on the type and size of the company, the due diligence may include:

• Legal aspects related to contracts, corporate structure and governance, industrial and intellectual property, administrative and environmental permits, employees, competition, social security and regulatory compliance.
• Financial and accounting aspects related to financial statements and accounting records, investors, debit and credit
•  Assessment of the real value of the company and determination of the sale price.

As this is a purchase from an Italian company, Due Diligence will be conducted according to the canons of the Italian legal system. Therefore, each aspect will be analyzed according to the provisions of the Civil Code and Italian laws.

Therefore, DUE DILIGENCE is a LEGAL BUSINESS AUDIT

In what cases is it necessary to conduct a legal audit of a business:

• Buying a new business or selling your own
• Absorption of business
• Analysis of investment attractiveness
• Analysis of risks and attractiveness of the company
• Business financing or lending

What is the cost or how much does it cost to check a company (business) in Italy?

To get an answer to this question, it is necessary to understand that the cost of due diligence in Italy, as anywhere, depends on the volume of work that lawyers and auditors need to carry out, on the number of questions that are investigated, on the volume of materials provided for verification, on the complexity in access to the information that needs to be checked.

Depending on this, there are at least two types of business verification

Full due diligence report (full scope) – the most detailed and complete analysis of all provided documents, open sources of information, as well as sources of information with limited access.

Selective due diligence report (red flag report) — only those questions raised for research are checked.

The legal company “Prykhodko and Partners” provides the following services. Before buying a company, you must understand its condition, including legal, tax, accounting, financial and other risks. Due diligence is carried out in the interests of both the business owner (Vendor Due Diligence) and the potential investor (Buyer Due Diligence)

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