The significance of environmental legal due diligence can be summarized in all the interventions aimed at investigating the activities carried out by the company, so that an economic assessment of the company can be reached on the one hand, and on the other start a dynamic process of continuous improvement.
Legal due diligence activities can be: full and limited.
The former, by definition, relate to the entire process of the production activities of the business person concerned, while the latter concern some specific aspects of the business activity and are aimed at the focus of some well-identified issues (think of the correct waste management,updating or improving organizational models, identifying applicable requirements).
The investigation activity can be commissioned by the potential seller or buyer (it is
due diligence and buyer
due diligencerespectively), or as is rarely the case with both Contractors.
The business of legal due diligence, often preceded by a letter of intent (LOI, letter of intent), is traced back to transactions such as: holdings, rents and divestments of companies and branches of companies, mergers and mergers splits, transformations and liquidations,access to competitive procedures (for the actual verification of the possibilities of satisfying the credit class), participation in public procurement,disbursement of funding and judicial and extrajudicial litigation for quantifying the damage.
The parties sign a confidentiality clause(letter of confidentiality) before preparing any activity, with which they undertake not to disclose the confidential information collected.
In extraordinary acquisition operations, compliance with environmental regulations is of significant value because these can identify the potential risks and costs associated with current activities and may have a potential impact on the environment as well as the result of environmental wrongdoing.
In view of the objective fact that legal legislation on environmental matters is characterized by very technical notions, by its nature the environmental legal due diligence will require investigations and assessments appropriate and site-specific (for example, in the acquisition of an industrial area it will be essential to analyze any historical contamination and related costs of (area restore).
Environmental risk analyses are as voluntary procedures for certifying the company’s environmental quality, thereby increasing the value of the company.
The due diligences are not prepared with sacramental formulas, not even with predetermined sequences, but the professionals of the Law Firm prefer to scan the required survey in distinct stages:
- inspection at the client company;
- conferring due diligence and signing related agreements (confidentiality clause, loi and memorandum of understanding for example);
- historical recovery of basic information relating to the legal entity to be analysed (social name, turnover, employees, any banking exposures, company entity etc…);
- analytical recollection of the legal situation documentation to be analyzed, identification of the scope of due diligence and the level of depth required and timing;
- elaboration and preparation of an intermediate report including monitoring and sampling with slavish interpretations;
- comments from the client;
- final report.