Due diligence is conducted by companies considering acquiring other companies, as well as equity analysts, fund managers, broker-dealers and individual investors. Accordingly, each financial company must comply with legal due diligence, financial due diligence, customer due diligence or customer due diligence, operational due diligence, and technical due diligence in all its processes. The purpose of this process is to minimize the risk of the operation through a study of the legal situation of the company, in which all legal risks are analyzed that could lead to the sale not being carried out or to future conflicts between the parties or damages for one of them, usually the investor or buyer, Caused. Hard and soft due diligence is intertwined when it comes to compensation and incentive programs. Not only are these programs based on real numbers, making them easy to integrate into post-acquisition planning, but they can also be discussed with employees and used to measure cultural impact. El alcance de la due diligence suele estar determinado por el tipo de negocio realizado por la empresa objetivo y el tamaño y el tipo de adquisición prevista, por ejemplo, si es una venta de acciones o una venta de negocios. Each type of due diligence process has a set of basic characteristics that they must follow for the mandatory KYC/KYB process, which standardizes and regulates it against best practices in this type of risk analysis methods. KYC Due Diligence Requirements: Performing gentle due diligence is not an exact science. It should focus on how a targeted workforce aligns with the culture of the acquiring company. Like all legal procedures, legal due diligence must comply with all applicable regulations that concern it, given the nature of the procedure. In this sense, these are the following regulations: Due diligence is also a concept that can be found in the civil law concept of a limitation period. Often, a statute of limitations begins to run against a plaintiff if that plaintiff knew, or should have known, if they had considered the case carefully, that the plaintiff had a claim against a defendant. In this context, the term “due diligence” determines the extent of a party`s constructive knowledge when it receives a disclosure of facts sufficient to constitute a “notice of investigation” alerting a potential applicant that further investigation may reveal a means.

La Due Diligence o debida diligencia es el proceso de recopilar, comprender y evaluar todos los riesgos legales asociados durante un proceso de fusiones y adquisiciones entre empresas. La realización de una debida diligencia legal suele ser el paso preliminar que da un inversor que tiene la intención de realizar una transacción de compra/venta de activos o acciones. In criminal law, due diligence is the only defence available for a crime that constitutes strict liability (i.e. a crime that requires only actus reus and not mens rea). Once the crime is proven, the bottom line is that the defendant must prove that he did everything possible to prevent the act. It is not enough that they have chosen the standard of care common in their industry – they must prove that they have taken all reasonable precautions. Due diligence is an investigation, review or review that is conducted to confirm the facts of a case under consideration. In the financial world, due diligence requires a review of financial records before entering into a proposed transaction with another party. Due diligence is also used in criminal law to describe the scope of a prosecutor`s obligation to seek to provide potentially exculpatory evidence to criminal defendants (accused). Increasingly, however, M&A transactions are also subject to the study of corporate culture, management and other human elements. This is called soft diligence.

Due diligence refers to the investigation itself. In this way, we are talking about a legal due diligence process or a legal review to refer to a person or company`s previous review operation in order to assess the possible risks associated with establishing an economic relationship with them. Una Due Diligence Legal se define como el proceso de investigación e información que realizan las partes, con tal de analizar en profundidad el estado legal de la empresa objeto de la transacción y determinar si existen riesgos en la compra de una empresa. With Becker Abogados, we have a team of lawyers specialized in mergers and acquisitions of companies and carry out due diligence with seriousness and professionalism. Secondly, as regards the contractual aspects, the examination focuses on documents such as contracts concluded, contracts to be concluded and those whose period of validity has expired, but which contain obligations until they are complied with. Similarly, insurance policies concluded and contracts or agreements with controlled, affiliated or affiliated companies are used. The purpose of the review of this documentation is to identify and analyze the existence of clauses that restrict, restrict or sanction the transfer of shares, the restructuring of the company, the change of target directors and the transfer of assets; Likewise, the validity of the General Conditions agreed in accordance with the legal provisions applicable by their nature. One of the most common conclusions is to find agreements whose agreed terms and conditions do not comply with the applicable legal provisions; Find contracts and agreements that contain provisions that restrict, restrict, or sanction the transfer of shares, corporate restructuring, change of target directors, and transfer of assets. It is also common to find contracts and agreements that contain outstanding obligations or contingent liabilities arising from terminated contracts. Due diligence takes different forms depending on the objective: it is generally used for concepts and situations where an investigation of a natural or legal person must be carried out before a contractual relationship or other types of exchanges. It is important to remember that identifying the subject (company or individual) on whom the due diligence process is to be carried out is an essential preliminary step.

Due diligence processes are closely related to the term KYB (Know Your Business). The first step in a remote, digital due diligence process is to identify the topic to be examined. This process of digitally identifying a company to confirm that the company is what it should be is called Know Your Business. The importance of operational due diligence refers to the iterative process of formulating and testing an investment thesis with the goal of creating an actionable value creation plan.