"The modern marketplace is global, and the ability to trade and grow internationally offers a strategic competitive advantage for any company looking to grow its revenues, diversify its risks and expand its target markets."
--- CRAIG M. KAISER, HOUSTON BUSINESS ATTORNEY
Whether your company has outgrown its domestic market, or it’s have pinpointed an overseas market with a lucrative gap that your services or product can fill, taking your business global is an attractive prospect for future growth. The checklist below provides some insight for businesses with international operations.
Standards and ProceduresDetermine if a foreign subsidiary is required to do business or is a branch/representative office all that is needed
Determine the timeline and requirements to do business in a foreign jurisdiction.
Determine the board/shareholder responsibilities, requirements, and functions in a foreign jurisdiction (e.g., local resident requirements, director/shareholder meetings, number of shareholders).
COMPLIANCE AND REGULATORY
Determine if employees are needed in the local jurisdiction, and, if so, what requirements and laws must be met.
All employees should be trained on the foreign country policies regarding security and compliance.
Comply with local and U.S. anti-bribery laws, and the U.S. Foreign Corrupt Practices Act.
Comply with export licenses and regulations for the shipment of technology and/or products outside of the U.S.
Comply with import licenses and regulations for the shipment of technology and/or products into a foreign jurisdiction.
Comply with all other regulatory rules of a foreign jurisdiction.
INTELLECTUAL PROPERTY AND TECHNOLOGY
Comply with U.S. restrictions of the use or sale of technology outside of the U.S.
Ensure intercompany licenses and agreements are in place to permit the use of technology outside of the U.S.
Comply with local foreign jurisdiction laws regarding the use of intellectual property in such jurisdiction.
Determine if intellectual property filings are required in the foreign jurisdiction to protect the company’s intellectual property (e.g., patent filings, trademark protection, etc.).
DATA PRIVACY LAWS
Comply with data privacy laws and requirements.
Comply with data privacy notification requirements to customers or employees.
Ensure compliance by third-party service providers.
Ensure the company’s data privacy policies are in place and are updated to comply with foreign jurisdiction data privacy laws.
Comply with foreign jurisdiction laws for the employment matters.
Determine if a third party provider is necessary for employees in a foreign jurisdiction (e.g., third party payroll provider, outsourced management company).
Comply with all employee benefits regulations.
Review laws to understand and comply with any mandatory unions or collective bargaining requirements and agreements.
Know any difficulty in terminating employees.
Comply with laws to engage independent contractors.
Ensure that competent local third party contractors and providers are engaged, and comply with all legal requirements for such engagement (e.g., time limitations).
Obtain the proper work permits for any employees.
Comply with the hiring and use of local employees and content.
FOREIGN EQUITY REQUIREMENTS
Comply with foreign jurisdiction equity securities laws for the grant of equity (e.g., disclosures, registrations, notifications).
Comply with foreign exchange laws.
Understand and comply with local tax laws for the issuance of equity securities.
Hire competent tax counsel/experts familiar with the tax laws of the foreign jurisdiction.
Comply with all tax laws of the foreign jurisdiction.
Determine the most appropriate operational structure to be utilized for the foreign operations to include transfer pricing considerations.
Mitigate tax liability by implementing the proper operational guidelines and best practices.
Implement proper tax policies for compliance with transfer pricing, value added tax, corporate income tax, financial accounts and reporting requirements and filing/reporting deadlines in the foreign jurisdiction.
Ensure compliance with any withholding tax laws.
Ensure all intercompany agreements are in place to comply with tax laws.
Understand and comply with all U.S. tax laws for foreign jurisdiction operations.
Note: The above is not all-inclusive and if you have any questions regarding your obligations under the law or about best practices regarding employment compliance matters, please consult an employment law specialists. Further, the information and materials contained herein are provided for general information purposes only and are not intended to constitute legal or other advice or opinions on any specific matters and are not intended to replace the advice of a qualified attorney, employment specialist or any other professional advisor. There is no guarantee as to the accuracy of any information provided, and should not be relied upon for any purpose other than for general information purposes only.