The GPSLA Business Guide to Due Diligence

Due diligence is the investigative research process required in making a business or investment decision like forming a partnership, hiring an employee or purchasing a stock.

Make sure you have your research completed, the "GPSLA way" before you make an investment, hire a key employee, or enter into a business partnership. Financial records for your investments and future partners here in California need to be verified and researched before you sign on the dotted line. There should be several items on your checklist, especially if you are a startup business or investing with United States (US) partners. We will cover a few of them here. Check past credit, income sources, and brokerage accounts of those you consider entering into a business relationship within California.

It is recommended to engage a third party to conduct a due diligence investigation to avoid any biases, shortcuts, or potential elimination of information gleaned during the research for dishonest reasons. Some professionals, however, feel that third-party entities could be involved in accepting bribes for contracts or services rendered; but in most business dealings, this is not highly likely, but you can never be certain. Whoever conducts the investigation, ensure they are licensed, insured, and have a service agreement with fees that outline what they are going to do for you and your request.

Conducting research

In setting up a business in the US and or California, conduct the research on all those persons and entities you will utilize to get the business off the ground, even if it is a subsidiary, division, or branch office. You should also include any vendors, investors, board members, if applicable, and advisors. If using contractors, make sure they have licenses and insurance and check their reputations for quality with previous clients and customers. By conducting due diligence investigations, you will find valuable information that will help you make an informed decision on whether you and your company want to engage in a business relationship with prospective entities.

If English is not the first language of the company representative or family member overseeing the relocation or business relationship, ensure you engage a translation service that can accurately and concisely translate all documents, agreements, employment forms, website materials, and anything which requires a signature. Additionally, have a corporate business attorney review and advise any negotiations you enter into for business relationships. Recognize that not all translation companies or corporate business attorneys have the experience and legal knowledge required for these types of international transactions and relocations.

GPSLA has translation services in every language, media type, or platform needed to accurately define and communicate the relationships and legal jargon so you can understand the terms and conditions proposed. Partnering with an attorney who consults and advises in international business and or mergers and acquisitions (M&A) is a must for your team of trusted advisors.

Looking for a home

When looking for a home, check with the National Realtor Association (NRA) for reputable and proven realtors to engage and the Housing Affordability Index (AFI) to measure whether you can qualify for mortgages in the area you choose to live. Many times, a buyer new to the US and California does not have the means and track record to show adequate funds to qualify for a long-term mortgage from a lender. Cash is a typical way to purchase property for some families coming to the US, but in cash sales, one is also taking a risk on the property and its "as is" condition. GPSLA has professionals experienced in real estate, banking, and lending who understand the needs of families relocating to California.

If relocating a family or company to the US and especially in California, employment law and immigration needs for navigating the system is paramount to acquiring the visas and hiring the legal way according to the current laws. A knowledgeable immigration attorney will be your first call in many cases and can r assist in recommending the best-qualified professionals to make every part of your journey to California successful. If the immigration attorney does not have these partners in their wheelhouse, you may need to consider a different firm. Not all immigration firms are an advocate for your family and business objectives in California. You must have an aggressive and experienced attorney who can point you on the right path. One incorrect move can put your move on an expensive and lengthy delay to entering and working legally in California under compliance obligations. The correct immigration attorney should be one who educates the representatives entering the US and, if a business is involved, works alongside your chosen employment attorney or Human Resource professional to make the right decisions under the laws of California. There are many types of visas, from nonimmigrant visas to immigrant visas in all aspects of work, both permanent and temporary. Again, GPSLA has that expert with the depth and knowledge necessary to understand the global immigration space and objectives of the moving party.

Immigration

When coming to the US, engage an attorney in the estate planning and trust administration area. The attorney can assist in protecting your assets in family and closely-held businesses that may have members in more than one country or are moving those assets directly to the US. You will want to be protected from unforeseen circumstances that could lead to probate, lawsuits, and tax implications. Their areas of practice should further include international laws protecting private wealth associated with trusts and estates and, if applicable, non-profit organizations and trade.

Conducting due diligence investigations for your company and family of multinationals is an important first step in understanding all the potential risks, challenges, and decisions in planning a successful move to California. An incorrect decision in these strategic matters could not only cause financial but business compliance or regulatory risks. Take your time and choose your advisory partners wisely when making your move. In review, ask upfront what the estimated range is with the associated costs to conduct the investigation and ask for a service agreement to review before moving forward. Time is of the essence here for your move in most cases. Obtain a turnaround time for a report detailing all information obtained and review with other members of your trusted advisors to alert you to any unforeseen red flags.

GPSLA is here to assist you with every turn in the road to setting up a successful company and making sure the family is safe and comfortable financially and selects the best home.

Do your research today.




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