Articles

Legal Issues In Starting Your Own Business

By: Marc C. Laredo, Esq. Laredo & Smith, LLP

You have decided to start your own business. Perhaps you have developed a concept for a new Internet product, thought of an idea for a consulting business, or simply want to open up your own pizza shop. Regardless of what your new venture is, in order to get it off the ground you will need to deal with the legal issues that are involved in running your own business.

First, you need to hire an attorney. It is important to choose the right attorney for you. He or she should be someone with whom you feel comfortable working and who is knowledgeable about the legal needs of new businesses. Ideally, your attorney will be your advisor - someone who adds value to your business.

Once you have selected your attorney, the next task will be to choose the form of entity for your new business: sole proprietorship, partnership, corporation, limited liability partnership, or limited liability company. Your attorney should explain the advantages and disadvantages of each option and help you pick the one that is right for you.

There are certain basic formalities associated with establishing any business. If you choose to form a corporation, for example, your attorney should prepare a series of documents such as articles of organization, consents, by-laws, stock certificates, and, if the corporation has more than one owner or shareholder, an agreement among the shareholders. The attorney should file any necessary papers with the secretary of state's office in the state where the business is incorporated and see to it that any filing fees are paid.

Your attorney also should help you identify some of the initial employment, financial, and intellectual property issues that you will need to handle, such as whether to have confidentiality and non-competition agreements for employees or others with whom you will work, the need for an accountant or bookkeeper and general tax issues, and, if your business involves something that you have invented or created, patent, copyright, and/or trademark protection.

Most likely, you will need space for your business, whether it is office space for the new Internet company or consulting business or retail space for the pizza shop. You should discuss these issues in detail with your attorney and let him or her help you negotiate the terms of any lease.

Once you have gotten your business up and running, you should encourage your attorney to be proactive in meeting your legal needs. In this way, your attorney can help prevent problems from occurring and assist you in a cost-effective manner in resolving legal problems when they do arise.

Please Note: The purpose of this article is to provide general information about legal developments and should not be used as a substitute for professional advice on your particular legal situation.