Understanding The Legal Considerations To Establish A New Corporate Entity

Starting a new business is pretty exciting. But when Building Corporate Entities, one must follow all the legal considerations to make sure that the business is well-protected from the outset.

Because of less resources, knowledge and experience, many business owners overlook several legal considerations.

These legal considerations are extremely crucial when he/she is planning to establish a business or a corporate entity in Perth. So, what are these legal considerations for a new corporate entity? Let’s find out:

1. Following the Fair-Trading Laws 

To make sure one gets to operate a business legally, he/she must follow all the government regulations for all the businesses in the country, especially the fair-trading laws.

These types of laws are placed to make sure that business owners get to follow all the fair-trading practices, keep every customer well-informed and also maintain competitiveness. Under the fair-trading practices, business owners must:

• Have good knowledge of consumer law in Australia
• Comply with the consumer and competition act
• Codes of practice
• Australian standards.

Individuals should also have an excellent understanding of the nitty-gritty of selling services and goods. For such reasons, one must have good knowledge about the following:

• Product labelling laws
• Trade measurement laws in Australia
• Laws related to displaying prices
• Pricing regulations
• Rules concerning the refunds and warranties
• The selling of services and goods.

2. Enforcing the Agreements

Another thing that a person needs when establishing a corporate entity in Australia is agreements or contracts.

Business owners must have a proper understanding of the agreements, their stipulations and terms right before they sign them. Individuals will get the chance to sign many of these contracts once they start operating a business.

When one agrees to create an item or render service instead of funds, it’s a legal contract, and all contracts are enforceable legally by the law.

Not meeting the terms of the agreement is enough to file a lawsuit against the business. That’s why business owners should go through all the terms and must adhere to all the clauses.

3. Picking the Correct Structure for the Business

Selecting the correct business structure is a crucial decision that one must make as the new owner. The structure of the business which he/she selects to operate will have a massive impact on

• Their personal liability
• Control over the business operations
• Amount of tax they must pay
• Growth potential

But remember, if we review all business structures, we will find both benefits and drawbacks in every business structure.

4. The Partnership or Shareholder Contract 

According to professional Corporate Lawyers in Perth, people who set up a business with co-founders will require a shareholder or partnership agreement. This type of agreement will cover some crucial considerations like:

• The dispute resolution
• Selling off the company
• How all the dividends get paid
• The sale of shares
• How often will the shareholders and directors meet
• What kind of decisions can the shareholders and directors can easily make

A shareholder’s contract will contain the “Deed of Accession”. This particular deed will be signed by the new shareholder and the company instead of letting every shareholder re-sign the shareholder contract.

When individuals get to establish a corporate entity or business with a partner, they will need a partnership contract.

This type of contract will mention the responsibility of all the business partners, the terms of ending the partnership, managing the business’s profits or winding up the business.

5. The Terms and Conditions 

The majority of the new companies have online sites, and due to such reasons, these businesses are liable. Hence, it’s crucial that one must provide the terms and conditions of their new business.

When an individual has a website for their business, they will follow the terms of usage for the website. These terms, which are between the visitors and the business owner, will lessen the liability and inform all the visitors about the behaviour of use that is acceptable.

If it gets to sell services or products, the website also needs the terms and conditions for the business. Apart from addressing consumer law needs, the business terms show how one can provide services or products to their respective clients.

All these terms can be pretty complicated to draft because they address all the obligations and rights of the users within the marketplace.

6. Don’t Break an Intellectual Property

Tangible properties, which are outcomes of creativity like copyrights and patents, are known as intellectual properties. Before you establish a business on Australian soil, you must register the intellectual property with the help of intellectual property lawyer in the country.

Apart from that, all the goods that one exports must not infringe on the intellectual properties of other businesses.

Have a good understanding of intellectual property law as it will help you prevent any type of monetary or legal action or penalty. You must conduct some research on the property to make sure that it’s not already registered.

7. Follow the Laws for Hiring People

When a person hires someone, he/she becomes completely responsible for them when they work at the workplace or when they do work outside of the office. One will also bear all the legal obligations towards these people. Some of these legal obligations are:

• Following the guidelines provided by the work safety and healthy terms and the codes of practice.
• Paying up all the fair wages.
• Having a proper worker’s compensation scheme
• Reimbursing them for all expense-related jobs.

In simple words, one must follow the laws of hiring people and have proper knowledge about all these legal needs before establishing a corporate entity or business and employing workers.

8. Getting to Know Australia’s Anti-Bullying Laws

When one thinks about certain things that they might need to establish a business legally, one must not forget about all the legal risks linked to harassment and bullying of workers. Bullying can put both the safety and health of the employees at massive risk, and such things should not be taken lightly.

When he/she wants to reduce liability, please take all the right steps and reduce the chances of harassment and bullying in the workplace.

Final Thoughts

Setting up a corporate business in Perth is an excellent choice for people who wish to conduct their business in a different country. But before proceeding further, one must check all the legal considerations.

To learn more about the legal considerations, speak to the experienced corporate lawyers in Perth. They can surely provide plenty of information on such matters.