If your SME is going to scale up and expand internationally, there are certain things that must happen. You need to understand each geographical territory’s legal requirements, there needs to be secure transport services in place, and planning is necessary to ensure that your internationalisation goes smoothly. A successful business venture means paying close attention to potential legal requirements – some of which may jump out at you (like a careful management of contracts); while others may go unnoticed unless you’ve had proper legal mentorship. One of these invisible risks that may bite you after several years of slow internationalisation and brand building is a contract governing asset ownership.

If a couple gets married, often (and this is dependent on the country), they will sign an antenuptial contract which governs their communal ownership of assets as well as what happens to assets when they get divorced. In the context of business ventures and ownership, antenuptial contracts can have a serious impact on a company’s future. Owner-managers need to understand the implications of their choice of contract.

For South African SMEs, an antenuptial contract – unless expressly stated otherwise – only applies for the duration of your new marriage. This means that if you own a 60% stake in an overseas business, but are married in the community of property to a South African spouse (where assets are jointly owned), that asset belongs to both parties. If the marriage is dissolved or one partner dies then the spouse may have a claim on 50% of the business asset, leaving the owner with only 30% to their name. This leaves room for serious strife unless both partners have signed a legal agreement. Equally vital is understanding how antenuptial contracts correlate with South Africa’s Companies Act – even if you and your spouse move overseas and sign an overseas legal document. If you take South African assets overseas and you’re married to someone in the community of property, these assets are still subject to local law.

For example, if you’re a South African who has relocated to Australia, you would sign a local contract stating that all assets acquired during your marriage are separate. Hence, they do not belong to either of you. However, an antenuptial contract could state that the assets belong to both of you equally. South African law remains in place which means that joint ownership cannot be disbanded unless a divorce takes place. It is the mandates by marriage that stay in place, regardless of a change in domicile.

Antenuptial contracts, and the serious consequences that stem from each type of contract, are just one of many legal hurdles that explore the multi-faceted negotiation of bi-national partnerships. Companies that are serious about scaling up globally cannot afford to ignore the local laws where they operate and where they plan to expand to. Not doing so means that they risk having their assets seized if legal conditions aren’t met or, in the case of antenuptial contracts, meeting the financial requirements of two legal document sets in two different countries.