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Tips on legal risk points of enterprises

  1. In the field of contract transactions, some enterprises are desperate to pursue profits, finance funds, and take risks. They lack consideration of legal factors before making business decisions, lack the standardization of transactions and the legitimacy of operations, break through the mandatory provisions of existing laws and regulations, and face the legal consequences of invalid contracts, resulting in the failure to achieve their expected goals. In the field of corporate governance, some enterprises have a vague understanding of the company law in the process of creating and operating companies.
  2. The strict performance of the contract is not enough, and the spirit of the contract needs to be strengthened. Some private enterprises are not strict enough in signing and performing contracts, mainly in the following aspects: first, it is only a verbal agreement. There is no written evidence for the oral agreement, so it is easy to be passive in case of disputes. The second is to ignore the preservation of evidence. Although some parties attach importance to signing a written contract, they neglect to collect and preserve the evidence of performing the contract. Once they are involved in litigation, their rights are likely to be unsupported. Third, the contract consciousness is indifferent. After signing the contract, it does not perform in accordance with the contract, and arbitrarily violates the terms of the contract, such as the construction party’s late delivery of the house and late handling of the certificate in the construction project dispute, and the failure to pay the payment at the agreed time in the sales contract dispute. If a party fails to perform the contract, it will not only cause losses to the other party, but also pay for its breach of contract.
  3. Some enterprises do not have a strong sense of evidence, and have not yet established the awareness of collecting, protecting and using evidence, which is mainly reflected in: first, the conclusion of the contract is crude, the terms and expressions are ambiguous, the settlement personnel, payment method and delivery process are unclear, and the product quality and specifications are unclear. The termination, modification, cancellation, etc. of the contract are not carried out in writing, resulting in performance risks. Second, the contracts and creditor’s rights vouchers entered into are not well kept, and there are cases of loss or defamation. When delivering goods, the other party is not required to issue a receipt, the goods are not accepted in time, and quality objections are not raised in accordance with the law when quality problems are found. Third, the payment does not explain the purpose, the financial accounts are chaotic, and the evidence of notice is not kept when notifying the delivery or urging the payment.
  4. Lack of normalized and standardized management, and risk prevention measures need to be improved. If an enterprise wants to develop healthily for a long time, it must carry out standardized management and establish “enterprise rationality”. Due to relatively standardized management, large enterprises have fewer litigation cases and a high rate of victory, while some small and medium-sized private enterprises often have the following problems: first, they ignore the construction of rules and regulations. Small and medium-sized private enterprises, due to their small scale and relatively few employees, often do not pay attention to the construction of rules and regulations. Second, poor team management. Personnel have unclear rights and responsibilities and a weak sense of responsibility. The warehouseman issued a statement of arrears, the company accountant issued an equipment acceptance report, and even the company’s personnel colluded with the counterparty to issue a creditor’s right certificate detrimental to the company. Third, the lack of risk early warning system. Which companies the company has signed contracts with, which payment and supply deadlines have expired, who is responsible for them, and which contract performance may have risks. These information has not been included in the data system for early warning evaluation, and there are management loopholes.




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