Basic Legal Concepts for Start-ups
Starting a business is an exciting and challenging endeavour many people dream of. Besides the product development, business plans, funding issues, etc., there are also other crucial issues that many startups seem to neglect. We are talking about the legal side of developing a company. Although legal issues may not be the most intriguing matter, they simply cannot be bypassed.
To help you navigate through the legal maze of complicated terms and issues, we will outline below the major legal concepts that every start-up should be aware of. Please note that the information in this article is based on UK law.
Registering the right business structure according to all relevant required laws should be a high up on your to-do list. In order to make the right choice, you need to research carefully which form of company or partnership suits your needs and aspirations for future development.
Nowadays, a company can be registered in a couple of steps online, at least in most Western jurisdictions. Setting up a company is encouraged by regulators and you do not need specific legal advice, at least if you are about to incorporate a simple business structure to satisfy your initial needs. In the UK, you can simply visit the government’s website which will give you enough information on what to expect in terms of requirement and costs.
Intellectual Property Rights
Intellectual Property Rights (“-IPR-”) are some of the most valuable assets a company can own. Protecting your ideas and creations is crucial. Intellectual property (IP) includes copyright, design, trademark and patents, and it is important to know the distinction between these four basic categories.
Copyright refers to any content created and the rights of protection to it arise automatically. It is important to note your copyright and make clear to anyone that the content in question is protected and owned by you.
Design rights consist of any design you create in the sense of shape or configuration of the object. Protection arises automatically for a period of 10 years; however for extra protection, you may want to register your design.
Trademarks refer to any words, names, logos, symbols, etc., that are unique to your brand or product. You should register them and you can do so on a local level (UK only, for instance) or you can get a Community Trademark protecting you in the entire EU. Of course, costs rise accordingly.
Patent rights concern industrial inventions and new processes. They give you the right to take legal action against anyone who makes, uses, sells or imports you in without your permission. Applying for a patent is a hefty and expensive procedure, however it is the only way to protect an invention of yours and to monetize its value.
For more information about IPRs in the UK, please visit the Intellectual Property website.
Tax compliance is an essential element of the well being of a business. In order to follow your tax requirements, you need to have a good understanding of the relevant tax regulations. In the UK, you can get more information visiting the HMRC website.
You should consider various forms of taxes such as value added tax (“-VAT-”), corporate tax, income tax, etc. Good knowledge and understanding of tax rules may save you a lot of money and trouble in the future.
If you intend to employ staff, an adequate knowledge of employment laws is a must. When you have people working for your business, you have to take into account a number of different legal issues. Adequate pay and minimum wage regulations, pension schemes, discrimination issues, employees conduct are all part of the wide range of employment legal issues to have in mind. Health, safety and the adherence to workplace regulations are also a considerable issue. Depending on the type of business, additional professional requirements may be applicable. Make sure you familiarise yourself with the relevant legislation; to avoid future hassles and have a peaceful relationship with your employees.