MODULE 3b

5. Legal framework

Any business decision for or against cooperation must also consider the legal aspects. Every entrepreneur has the need for security, in particular for legal certainty, if he thinks about forming a business cooperation.

You would like to have clarified the following questions above all:

  • What rights arise for me from the cooperation?
  • What obligations do I have due to the cooperation?
  • What risks do I take as an entrepreneur through the cooperation?

We recommend you from the very beginning to:

  • Document oral discussions between potential cooperation partners. Yes, this takes a little effort, but it facilitates the enlightenment in a later dispute.
  • Write down minutes of an important personal or telephone conversation and show it all partners.
  • Involve an expert (lawyer, economic consultant) even to the preliminary discussions.

Any cooperation agreement should be concluded in writing as oral cooperation agreements do not offer legal certainty. Of course in practice there is good and bad experience with both – written and oral agreements.

  • Requirements for the "ability to cooperate" of the partners (know-how, infrastructures, etc.) are determined by the type of cooperation and its goals.
  • A precise determination of the funds needed for the establishment and leadership of the cooperation (funds, offices, know-how, etc.) may be required as soon as you decide for one of the available legal forms to cooperate.

This crucial issue should be clarified and contracted before the cooperation begins. If there is no contractual arrangement between the partners, the later dispute is often "pre-programmed". The legal systems leave the partners a lot of scope for the contractual design for the use of intellectual property within a cooperation.
It should be regulated above all:

  • What rights for intellectual property do partners have when cooperating terminates or one of the partners leaves the cooperation or a new partner enters?
  • Is there, e.g. a financial compensation amongst the partners in case of exit or entry?

Check out the COFARM Case Studies with focus on the agreements taken there, if these are oral or written and what experience was made with this!

  • Cooperation agreement for temporary project cooperation.
  • Choice of legal forms for business cooperation.
  • Creation of a new company by the partners of the cooperation.

Please check your information about:

  • National fundamental legal considerations in cooperations.
  • The possible national legal forms of cooperation and its features, advantages and disadvantages.
  • External representation and internal leading.
  • Necessary means for founding: financial needs, knowhow, etc.
  • Will there originate joint capital?
  • What happens in the case of termination with the capital and the intellectual property?

In any case, it is advised in these very individual concerns to seek appropriate technical support!

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SELF-ASSESMENT

This questionnaire will allow you to evaluate the competences acquired by studying the module.

This project has been funded with support from the European Commission.This publication reflects the views only of the author, and the Commission cannot be held responsible for any use which may be made of the information contained therein.
CO-FARM: Enhancing COoperation amongst FARMing entrepreneurs
Project Number: 2016-1-IE01-KA202-016870

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