2020 has been a year that will leave its mark on history, the context of the pandemic made that not only people, but also businesses had to reinvent themselves. Virtuality opened the doors for many entrepreneurs to open their markets abroad, finding suppliers and partners around the world. However, expanding abroad requires planning to avoid future inconveniences. Today at López & James, learn how to venture into foreign trade without risking your business.
An immediate example of the expansion of foreign trade in Colombia is China, the Asian giant has come to invest nearly one billion dollars in our country1 and this has influenced small and medium Colombian entrepreneurs to be interested in doing business with Chinese suppliers. If your company wishes to enter this market and any other foreign market, it is ideal to carry out a preliminary study of suppliers before making contact. This study should be aimed at verifying, among other things, the legal existence of your future supplier, as well as reviewing the size of the factory and the number of employees; having knowledge of this information is essential because it will serve as a guide to know if the service proposal that this supplier sends is in line with the reality of their capabilities.
Secondly, once you have chosen a supplier and after having verified their production capacity, the next step will be to draw up a contract that will protect you and your business in the event of a contingency. Many times, although good faith prevails in commercial relationships, such links are not exempt from events that could put the parties of a commercial relationship at a disadvantage, such as the loss of a shipment or customs inconveniences at the time of entry or exit of products, all of these are possible contingencies and a contract specifying what will be done in case they happen and on whom the burden of responding will fall, will save discussions, losses of money and even future litigation.
If you have already done this kind of business and are currently in a conflict of this type, the first thing you should do is to seek legal advice, which will serve as a negotiating intermediary with the objective of minimizing the loss from any unforeseen events that have already occurred, usually involving monetary losses. López & James has been advising companies in cases of this nature for 14 years, not only when the affectation has already occurred, but also in a preventive manner, carrying out studies of future suppliers and drafting the corresponding contracts, all with the purpose of providing assurance to their clients. Currently in China, we have a specialized team that can take care of everything from previous studies of suppliers to taking cases to court when they are viable.
Likewise, we are also willing to collaborate in any other area that requires our experience, since our team of general, legal, tax and accounting consultants is willing to offer you advice through their virtual channels at any time by sending an e-mail to firstname.lastname@example.org or by calling our landline in Bogotá +(571) 7498261. For more information, please visit www.lopezjames.com.
About the author:
Carlos Méndez is a lawyer, part of Gestiones Empresariales López & James from de Bogotá team, and has experience in tax and labor law issues.
Languages: Spanish, English and Japanese. Bogotá D.C. December 17, 2020.