Introduction: What is Risk Assessment?
Risk Assessment is a fundamental legal and business process that involves identifying, analyzing, and evaluating potential threats inherent in an organization's activities. Unlike narrowly specialized assessments (e.g., only tax or operational), this service offers a holistic, 360-degree view of a company's legal health. For businesses operating in Georgia, which often face complex challenges, a general risk assessment is the first step in strategic decision-making. This service is particularly relevant before making investments, during reorganization, or as part of an annual "Legal Health Check."
What Does This Service Cover?
Risk assessment involves a complete diagnosis of the company's legal ecosystem:
- Corporate Structure Analysis: Checking the charter, shareholders' agreement, and governance structure for flaws.
- Contractual Risk Audit: Reviewing key contracts (lease, supply, service) to identify unfavorable terms.
- Litigation History and Outlook: Analyzing current and potential disputes and forecasting financial impact.
- Legal Status of Assets: Verifying the correctness of registration for real estate, movable property, and intellectual property.
- Baseline Compliance Check: General alignment with tax, labor, and administrative legislation.
Common Real-World Scenarios
Risk assessment is essential in the following scenarios:
- Mergers and Acquisitions (M&A): An investor wants to know what "skeletons are in the closet" before purchasing a share in a company (Due Diligence).
- Entry of a New Partner: When a new shareholder joins the company and the current status needs to be fixed.
- Attracting Financing: A bank or international financial institution requests a legal risk report before issuing a loan.
- Change of Management: When appointing a new director, so they know what legacy they are inheriting.
- Strategic Planning: During budget planning at the beginning of the year, to account for potential legal costs.
Georgian Legal Framework
In the risk assessment process, lawyers rely on a wide range of legislation. The Law on Entrepreneurs defines corporate obligations. The Civil Code of Georgia regulates contractual and property relations. The Tax Code creates the framework for assessing fiscal risks. regarding intellectual property, the Law on Copyright and Related Rights and the Law on Trademarks are used. When assessing real estate risks, analyzing data from the Public Registry is crucial. This multifaceted approach ensures that no legal aspect is left unattended.
Service Process
The risk assessment procedure is standardized:
- Information Collection: Requesting documentation from the client (based on a checklist) and interviews with management.
- Analysis: The legal team studies the provided materials and checks public registers.
- Risk Matrix: A document is created where risks are arranged according to severity and probability of occurrence.
- Report: A detailed report is presented to the client with discovered problems and ways to solve them.
- Presentation: Discussing results with decision-makers.
Why Use Legal.ge?
Legal.ge is the ideal place to obtain comprehensive risk assessment services because it gathers lawyers of various profiles. Often, a full assessment requires the involvement of corporate, tax, and labor law specialists. Our platform allows you to assemble a multidisciplinary team or find a firm that will conduct a complete legal diagnosis of your business on a "one-stop-shop" principle.
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