·  Legal News, Analysis, & Commentary


Protect Your Business From Legal Pitfalls

— May 31, 2019

Legal pitfalls exist in all industries and for all companies regardless of size. However, you can avoid many of them by proper preparation.

Dealing with legal issues is a normal, regular part of doing business. You are bound to run into one sooner or later, these are like natural catastrophes, or the weather – they will happen, but it’s up to you to prepare. And “prepare” is the key word here. Legal mistakes, bureaucratic errors, and just gaffs in general happen. Even if you have a good understanding of the law, you can expect some legal pitfalls to spring up. For this reason, we have written up a short article on how to handle yourself, your business, and how to get ready if the worst happens.

The home front

If you want to stay safe, you need to make everything clear when dealing with internal agreements. Any and all agreements with your co-founders, principles, investors, and starting business partners need to be set up in writing, legally formalized. Keep everything in writing, and remember that (unfortunately) a handshake just isn’t enough. We understand that you trust these people completely, but unfortunately people can change over the years. By getting things properly formalized and organized at the very beginning, you will save yourself from a lot of grief and headaches in the future, if the worst comes to pass. And if not, well, then you just wasted one hour of your (lawyer’s) time.

Intellectual property, copyright, and patents

Trademarks serve a very important function for your company. They protect your brand, they serve as a safeguard, keeping people from illegally copying your logo, slogan, name, or basically anything else that is part of your company’s image. Someone may decide to sell low quality goods and provide low quality services under your name. This can make it easier for them to get customers, since they’re leeching off of your own customer base. The trick here is that if you have a proper trademark set up, you will be able to solve the issue quickly and efficiently through legal means. 

Then, we have patents. A patent can be set for an invention, or even a business method. It serves as protection against people who would profit off of your own unique product. As with trademarks, contacting business solicitors can help you get this problem handles easily once you have a good legal basis to stand on. 

Copyrights are there to protect some original work of yours – a piece of art, your writing, or software you developed. You need to have the proper safeguards put in place if you want to avoid lengthy legal battles in the future, or in fact, avoid them completely.


Depending on your line of business, you need to follow the right regulations. Certain fields (like insurance or banking) are followed by heavy and serious regulations, both set up by the government and even international law. You need to familiarize yourself with these rules as soon as possible, and always work in accordance with them. A lack of compliance may have disastrous results, and is one of the biggest legal pitfalls for some businesses.

Man in suit reading business newspaper; image by Adeolu Eletu, via
Man in suit reading business newspaper; image by Adeolu Eletu, via

Furthermore, you may need the right licensing, or the right certificates in order to run your company. Building permits, certificate of training, the right to handle certain materials… There may be too many to count, but you still need to get all the proper documentation. Otherwise, you can face fines, penalties, and in general lots of grief. A local inspectior may knock on your door and ask to see your papers. What makes this more difficult is the fact that regulations tend to change from year to year, so staying in touch with the right licenses can serve as a separate job all to itself. 


Any and every company owner wants to minimize his or her taxes in any (legal) way possible. And one of the best ways to do this is to structure your company properly, understanding what tax requirements you have to meet… Things like whether you need to pay sales tax, your relationship with subsidies… 

There are completely legal and acceptable ways you can minimize taxes, get the right write-offs, and just in general make the most out of your taxes and income. 

Your employees

When hiring people, you need to fulfill all the necessary governmental employment laws. This means setting up proper contracts between your company and full-time employees. Don’t leave anything unregulated – you will need a good legally binding contract between you all in order to fulfill government requirements. Things like benefits, insurance, training, this all requires proper proof and regulation.

Furthermore, are you employees properly protected? If you’re in a line of work where people handle dangerous materials, you need to provide appropriate equipment, training, and facilities. A lack of these can get you sued, and will incur added fines from relevant authorities. 

In order to protect your business from any legal pitfalls, you need to inform and educate yourself properly. You need adequate protection from people who may try to take advantage of you, through copyrights, patents, proper contracts, etc. However, you also need to protect yourself from your own errors. There are many regulations, laws, tax issues, and bylaws that govern how people run their businesses. Neglecting any of these, by no fault of your own other than simply forgetting about them, can still get you into trouble. So practice due diligence, get professional advice, and get to work.

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