Understanding the legal nature of object provides the foundation for SMEs and Startups to empower their ventures on Up4Scale platform. It is a technical subject that has a direct bearing on the legal standing of your business.

A legal object is the subject-matter which is the object of the person(s) in a legal sense. In commercial law, legal object is an important concept when doing business transactions.

As an SME, the object of your business is to develop a sustainable business model. Analyzing your legal object enables you to understand the risks associated with your business. It provides an overview of the issues involved when evaluating your business model and decision-making process. It extends from sales contracts all the way up to mergers and acquisitions.

Crucial to M&A or any international business transaction is the interpretation of the legal object. It helps the parties involved to understand the fundamental aspects of the business, such as scope of business, limit of liability, due diligence, tax exposure, intellectual property, process of acquisition or liquidation and risk analysis. It also helps in negotiating the terms of acquiring or liquidating a business.

Knowledge of the legal object of a venture has a direct impact on business operations and strategy. It enables the management to reduce potential exposure to legal litigation, improve the management of business risks, assess the health of solvency, prevent potential monopolistic practices, and reduce the risk of anti-competitive behavior.

It is often the case that a legal object has multiple legal meanings. For example, how do you understand the legal object of your business? Is it legal, equitable or regulatory? What are its fundamental aspects, processes, procedures and practices? Do you have a clear definition of what the legal object encompasses? Have you enacted laws, rules, regulations, articles, by-laws, or resolutions to shape the form of your business? How do you set-up, operate, manage and direct the business accordingly?

The key is understanding the legal nature of your business. It is essential to protect the organization from legal exposure. It also protects the rights and interests of the persons associated with the business, such as management and stakeholders.

The law of legal objects is a growing area of commercial law. The law deliberately over-emphasizes these things in order to minimize the ambiguities involved in interpreting legal concepts in a systematic and holistic manner.

Many people have heard of the saying, “What is good for the goose is good for the gander.” In a similar vein, they must learn to invoke the legal objects defense. They must know how to educate management to be alert as to the risk of legal scrutiny, corruption, as well as antitrust and compliance infringements with local and international laws.

Some typical legal objects involved in business transactions include but are not limited to the following (by no means an exhaustive list):

In the world of business transactions, it is not what you know that defines the realm of possibilities. It is the quality of advice you seek to understand the nature of the problem. To be empowered you need to know who to speak to, what issues to prioritize, how to become more effective. The Up4Scale platform enables you to seek advice throughout the business lifecycle.

For more information on legal concepts, you can visit the Wikipedia page on legal objects.