Ten rules on how to achieve
efficient transactions.
1.
Find a law firm that suits you
Transactions
Choose a law firm of independent experts in efficient transactions, a law firm led by business-minded advisors.
This requires excellent legal knowledge, strategic thinking, tactical intuition, psychological skills, accurate assessments of their clients and their opponents, the relevant markets and the tax situation.
So, if you are planning to establish, participate in or take over a company, if you want to merge your company with another one or sell it, if you want to acquire or sell real estate, or if you are considering restructuring or transferring your assets to the next generation: partner with a law firm that doesn’t have to be big itself just because your issue is one of such magnitude.
Because what matters to you is to obtain the best qualifications for all stages of your transaction: from the concept to the accompanying examination of the legal circumstances, the drafting and negotiation of the contract, and the financing. This is where independence, flexibility and a law firm’s network prove their worth. This is the only way to achieve intelligent and efficient transaction management. Your project will not only be implemented as simply and viably as possible from a legal perspective, but also structured in a legally intelligent way.
2.
Look for an advisor in your desired law firm, and in doing so, don’t be ruled by your head alone.
Consulting
If your advisor refuses to compromise in terms of quality and ethos, not even to you, he or she will be all the more valuable to you in the long run.
Whether your consultant should match your personality traits or better complement them is academic. Diligence and conscientiousness are always mandatory. Negotiating skills are indispensable not only in contract negotiations, but also in any litigation.
The decisive factor for you is rather whether your advisor understands your values, whether they can comprehend your motives and grasp your objectives. If so, you are already close to finding the advisor who you will feel the most comfortable with. The lawyer who has earned your trust. When you have that first conversation with a lawyer, don’t forget to listen to your feelings. Will you be happy to discuss your plans and motivations with this lawyer and also allow them to ask critical questions? After all, this is the only way to ensure successful strategic planning through to final implementation.
3.
Work exclusively with an expert who is also a generalist.
Strategy
Practicable solutions to problems require in-depth legal know-how in different areas of expertise – and at the same time a constant view of the whole picture.
You are interested in a law firm that handles demanding cases of significant economic importance. A firm that is known for providing advice that is geared to the economic success of its clients. A law firm that has acquired particular expertise in negotiating and drafting important contracts, especially in the areas of corporate law and corporate acquisitions. Alternatively, you are interested in an advisor who understands real estate law and property transactions or asset succession.
This should not be enough for you: expect economic understanding, financial and tax knowledge and last but not least, negotiating skills and experience in entrepreneurial strategy, tactics and psychology. All this turns an expert into a generalist who can maintain a view of the whole picture over the entire period of a transaction. Openly discuss your situation, your point of view and your plans. This is the only way to determine whether the lawyer on the other side of the table can quickly acquire the necessary detailed knowledge and, most importantly, use it effectively to achieve the goal of your transaction.
4.
Insist on distance when you need the proximity of sound advice.
Attitude
A responsible advisor maintains objectivity only if they keep their distance.
A transaction is always an exceptional event, especially for you as one of the central actors. Moreover, a transaction is a complex and dynamic process. You will only be able – or allowed – to disclose all the processes and ideas to a few people. Your project involves great risks in many phases, not least for you personally. You will quickly find yourself isolated if you do not have an advisor to guide you safely and reliably through a transaction. Advisors are one of the most important companions during these steps, which are so important for you and your company, because they are exclusively committed to you.
Experience shows that at some point, all hell will break loose. Always.
And experience also shows that an advisor does not get better if they lose that distance to their client. You can be sure of one thing. However challenging your advisor is towards you and however high the standard they set themselves, they will bring that same level of energy and determination to the task of managing and carrying out your project. Expect your advisor to visit you, in your home and in your company. Expect intrusive questions. Even if a consultant doesn’t share your corporate culture, they should be familiar with it. It is entirely possible to negotiate a merger in such a way that, when it is completed, both partners look forward to working together. Protect yourself, not least from your own vanity. Don’t buy a lawyer. Partner with them, and put up with them asking awkward questions and keeping their distance from you. Demand the objectivity of a responsible counsellor. This is the best way for them to protect you and your interests.
5.
Trust a lawyer who is also entrepreneurial in their mindset.
Independence
Your advisor’s business independence is a valuable indication of their ability and willingness to deliver a high level of performance.
Inner independence. Charisma. The ability to think in a visionary way and to inspire. Not mere decision-making authority, but actual decisiveness. Perseverance. The willingness to take risks and assume responsibility. There are many attributes that make a good entrepreneur. Find out how much these attributes mean to the lawyer of your choice.
Are they self-employed? If they practice in a larger firm, are they one of the partners? Even if you can answer “yes” to these questions, you’re not quite there yet. You will quickly find out how far your consultant’s entrepreneurial independence goes when you get to know them. Watch out for statements like “I feel responsible for my client”. Or: “We want to be freelancers and to be able to act independently”. In many such phrases about themselves or their law practice, a consultant can give clues as to how strongly they can internalise your role.
6.
Demand international expertise from your lawyer as well.
Internationality
A transactional law firm should have an international network and international expertise.
The economic power of large corporations beats that of many of the world’s economies. Today, most companies are structured more by subject area than along national lines. In addition, the internet has ensured that even small and medium-sized regional companies can successfully navigate international markets. A law firm that is supposed to advise you competently in corporate and real estate transactions, your asset structuring and succession planning has to take this development into account in many ways. Determine whether your law firm is prepared for such a case. For example, by having an international legal network at your disposal.
Can you take advantage of tax law differences for a transaction? Does it make sense to move the company’s registered office there as well after buying a company abroad.
Can moving abroad be a sensible part of your asset and succession planning? The fluent command of foreign languages is a prerequisite for answering these questions. Inquire about additional foreign qualifications and foreign partner lawyers, and make it a condition that they are selected for quality and are personally known to your advisor.
Conversely, if you are entering the German market, use a law firm that can also understand your market. That appreciates what your project means to you and your company. It is most likely to be able to assert your interests in Germany.
7.
Expect creativity from your lawyer
in addition to professional expertise.
Creativity
Intelligent, efficient transaction management requires a lawyer who is both experienced and imaginative.
Let’s assume you have chosen a consultant. Let’s also assume you can count on them having thorough knowledge of business and tax law. And let’s assume you will soon be presented with an accurate assessment of your project. Then you are finally approaching the actual and most challenging field of an ambitious transaction lawyer. Because now it is up to them whether they offer you a prefabricated, standard procedure or a meticulously tailored implementation
of your project. The narrower the room for manoeuvre then becomes, the more valuable your lawyer’s creativity will be.
Now, if their mindset is unconventional and responsive, they will quickly turn an obstacle into an opportunity. If their attitude is courageous, decisive and positive, they will be able to plead a new solution just as credibly as one that has already been used many times. If their horizon is broader than their daily tasks, they will be good for a surprise or two. If, on top of all that, they have also acquired experience in a wide variety of problems, this is tantamount to a feasibility guarantee for novel, unconventional solutions.
8.
Achten Sie nicht nur auf ein optimales Ergebnis, sondern auch darauf, wie schnell Sie es erreichen.
Efficiency
Everything in your law firm should be geared toward achieving the best possible result for you in a short period of time with a high level of effort.
A formidable negotiation outcome is worthless if it is achieved too late and a competitor beats you to it. A particularly important aspect of working with a law firm is its transparency. From the outset, insist on direct, personal contact with your lawyer, and make sure they do not pass you on to someone else or even hand over your brief to their staff after the first meeting. This is the only way to develop a relationship of trust within a short period of time, which forms the basis of targeted consultancy. Because only in cooperation with you can an individual solution be created that is ideally tailored to your interests and specific business, financial and personal circumstances.
This is not only obvious when negotiating a contract, but also when drawing up an accurate draft of a more comprehensive contract or a will. Make sure, therefore, that your legal advisor has a feel for the specifics of your case.
Your transaction must always be under the direct control of your lawyer. If they use a team, it should be small and effective, and it should handle your transaction from start to finish. Your lawyer can then quickly assess at any time whether you can continue to achieve your goal by negotiation or whether litigation is now unavoidable in order to enforce your claims, for example. In short: everything in your law office should be geared to achieving an optimal result for you in a short time with a high level of commitment.
9.
Avoid Pyrrhic victories.
Insist on a lasting solution.
Permanence
A transaction is only successful if it works for the long term.
Insist on proportionality of means. Insist that your lawyer prefers settlement to confrontation. A transaction is only successful if it works on a permanent basis. And in many cases, it will only do so if the result is a win-win situation. To achieve this, your lawyer must also empathise with the motives and circumstances of your prospective transaction counterpart.
If you have chosen the right lawyer for you, allow them to provide the decisive ideas for a successful transaction.
It is true that a settlement is often better than litigating a matter. But if there is no other way and you have to decide in favour of litigation, make sure your law firm has sufficient litigation experience for the case so that your interests will prevail.