Often, businessmen conclude their first contracts with business partners without knowing them at all. No mutual experience with each other. Delivering goods in advance without advance payment, longer maturity of invoices belong to the most often risk factors resulting in unpaid obligations. Detailed knowledge of a business partner may facilitate success in future cooperation.
Often, clients have no idea, unfortunately, that they do business with a company in arrears with payments to state authorities, for example, tax office, public institutions, or that a danger exists it will go bankrupt, execution proceedings are pending against it already to enforce claims resulting from valid judgment. Being aware in advance of issues your potential partner is facing would surely result in considering future cooperation and avoiding potential insolvency of business partners to meet their obligations.
We recommend to our clients our service of legal analysis of a business partner in which certain risks of mutual cooperation may be found, mainly potential inability of business partners to meet their obligations in future.
Therefore, we prepare analyses of potential business partners from Slovakia, focusing mainly on the below information.
- Economic situation and management of their company, analysis of accounting closure statements published at the official web page of the Slovak Ministry of Finance (e.g. yields, sales, profit, costs, assets, financial accounts, receivables, payables etc.)
- Tax or customs arrears with the Slovak Financial Authority
- Arrears in social and health contributions
- Information from the Central Register of Execution Proceedings whether anything is pending against the company
- Intangible assets of the company, potential right of lien on intangible assets and other company related information registered in the Land Cadastre
- Information from the Bankruptcy Register whether bankruptcy or a restructuring procedure is pending against the company
- Information from the Commercial Bulletin of the Slovak Republic about auctions, bankruptcies and restructuring proceedings, execution proceedings, liquidation etc.
- Mandatory published contracts with state and public authorities
- Information from the Register of the right of lien about rights of lien (other than those in Land Cadastre) to check if the third persons´ encumbrances are registered upon other assets of the company (other than intangible assets) as well as resulting credit exposure and burden estimate
- Information available from public registers maintained by the Slovak Ministry of Justice and other institutions maintaining court registers whether the company was a party in closed and finished court proceedings
If you would enforce your claim/debt in a court proceedings, issued judgement and execution proceedings that would follow surely mean a success for you as a plaintiff. Judgment and execution proceedings, however, does not guarantee that your claim will be enforced / debt recovered. Execution proceedings would probably fail if the debtor has no assets.
Our analysis of a business partner would not remove all potential future risks. The client may nevertheless make better informed decision when knowing the history and the latest situation of potential partner´s company, obtained from independent sources. In particular, if defects were found in a partner´s history, that would indicate potential future cooperation failure.
You may find out the reliability and credibility of your partner at low costs.
Failing to do so will increase the probability of unpaid obligations in future.