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16 FebCAPITAL CONTRIBUTION TO INVESTMENT PROJECT
Among different forms of investment, making capital contribution into the project in form of a contract is one of the most high-risk forms for the following reasons:
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The investor is not able to directly manage the enterprise receiving the capital, leading to high risk of capital loss.
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It’s hard to manage and control the use of the capital to ensure it is used for the right purpose and in efficient way.
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The investor is not guaranteed with assets in case of capital loss.
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The investor is not allowed to transfer capital to a third party except in case where the other party approve.
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The investor may face hindrances from owner of the enterprise in withdrawing and dividing the profit from capital contribution.
How can the risks management can be utilized during contributing capital in the form of contracts?
LEGAL CONSULTING SERVICES IN CAPITAL CONTRIBUTION INTO PROJECT
From our experience, LAWPRO may assist clients in managing legal risks when investing capital into the project.
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Performing legal due diligence.
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Advising forms of project investment.
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Advising investment capital disbursement conditions and measures for ensuring investment capital recovery.
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Advising tax policies and profit distribution.
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Assisting in drafting and reviewing drafts of investor’s contract.
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Representing investors in contract negotiation of capital contribution.
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