Cross-Border Transactions

In today's global trade climate it is essential that business people have access to legal counsel that are expert in negotiating and executing multi-jurisdictional, cross-border transactions. The Whittier Law Firm ("WLF") has more than 25 years experience in advising companies operating in multiple markets.

The WLF focuses the attention of the client involved in international business on the unique issues involved, whether it is a country's recently developed and evolving legal system, foreign exchange control policies, conflict of laws issues or tax exposure and risk management strategies. By isolating and controlling these key issues, the WLF assists the client in increasing, exponentially, its prospects for profitability and long-term success in the target foreign market.

Other key concerns for which the Whittier Law Firm provides legal counsel to the international entrepreneur are:

1. Execution: The need to address multiple legal systems, languages and time zones can significantly complicate challenges that also exist in domestic transactions.
   
   
2. Legal Enforceability and Risk: Substantive differences between the laws and legal systems of different jurisdictions create many issues that require attention. The WLF's use of local attorneys affiliated with the firm significantly reduces the risks of doing transactions in non-U.S. jurisdictions, particularly in countries with unknown and/or undeveloped legal systems.
   
   
3. Cultural: The WLF's years of international experience across four continents and its network of local legal firms in over 20 countries, give our clients the insight into local culture, customs and business practices that can avoid unnecessary missteps while transaction the deal.
   
   
4. Transaction Structure: Transaction structure is driven by tax, accounting, reporting, corporate, labor and other considerations. The deal is only successful if it creates wealth, without fundamental, on-going problems with tax and other regulatory authorities.
   
   
5. Transaction Management: Transaction management issues are relevant to any transaction, in a cross-border transaction situation that involves multiple time zones, languages and cultures. The WLF and its network of local attorneys, manage the client's business from initiation to closing.
   
   
6. Governing Law: Choice of governing law is important for several reasons; not least of which is where execution of judgments can be facilitated most easily and purposefully.
   
   
7. Enforceability: A good agreement is useless without the ability to enforce it. Acquiring a business in jurisdictions where the legal system is not developed or that are subject to an unstable political system requires the purchaser to evaluate not only the content of the local law but also the strength of the local legal system. If it is not possible to enforce a contract (or a portion of it) and/or a non-U.S. judgment concerning such contract in the relevant jurisdiction then the purchaser must do a different risk/benefit analysis.
   
   
8. Negotiating the Preliminary Agreement: An early choice of governing law is particularly important due to differences in various jurisdictions' substantive law regarding preliminary agreements. In the U.S. it is customary to negotiate some type of preliminary agreement that sets out the basic terms of the deal. Typically, courts will find binding only those provisions of the agreement that purport to be binding. In other jurisdictions, however, this may not be so simple. Careful diligence is necessary to inform the parties of all of the obligations they might find themselves bound to under particular choices of law.
   
   
9. Financing: Financing has been and continues to become an increasingly important factor of any significant transaction. Typically, an acquiring company in a cross-border transaction will have equity, senior debt, mezzanine and other forms of financing in the same manner that these are used domestically. However, financing decisions may be constrained by the laws of non-U.S. jurisdictions. The WLF and its associated local counsel will help the client construct a built-for-purpose financing structure which will provide an avenue to necessary financing while keeping the transaction legally within U.S. and out-country securities laws.
   
   
10. Governmental Approvals: Often, the actual completion of a transaction or the operation of the acquired business post transaction requires non-U.S. governmental approvals. These can be expensive and time consuming and may affect the basics of the deal. Therefore, it is important to review these requirements in advance in order to structure the transaction appropriately as well as develop a realistic timetable.
    
    
11. Due Diligence and Disclosure Standards: A due diligence investigation is an important part of any transaction. A purchaser's ability to inquire into the vitality of a potential target and the accuracy of its financial statements will test the effectiveness with which purchaser and its advisers have succeeded in coordinating the transaction. It must carefully assign the many tasks to be completed to appropriate advisors and assemble the resulting data in a useful fashion.
    
    
12. Closing the Transaction: Closing a cross-border transaction brings together many of the issues discussed above. In addition to completing all the substantive issues, closing the transaction represents a significant task of organization. Formal, but necessary details must be adhered to, such as: original signatures and notarizations, multi-location closing procedures and monetary transfers through international banks. The Whittier Law Firm exists to guide the business client through the morass of legal, regulatory and cultural hurdles that stand as hazards to the successful completion of international trade and cross-border transactions.