Company administration - ERDOSDR

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Company administration

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The company administration procedures are not only limited to the formation of companies and their changes. Matters which require overview include: tasks and events in the daily lives of businesses, formation and termination of agreements between the board members and in-house rival groups actions resolved, and it also includes issues related to the legal supervision of firms.

It is therefore important to know the company procedures with respect to the founding documents (articles of association) knowing when a standard template needs to be modified for specific corporate structures, and that is when you need to record a version different from the template model articles of association and memorandum prepared.   One of the reasons, for example if a company gets the right to sells tobacco products.  

There is a deed of the members in which they must declare a contract of sale of tobacco is not to the detriment of the articles of incorporation and will not change in the future.   As long as they do not change the Registration Act, such rules, and declaration deed do not fit into the standard versions of founding documents, and if not made correctly the company will lose its rights and be struck off the State company registrar.  

It is also important to handle the desires of the founders, who may have different wishes and to incorporate them in the company's activity. Disagreements that may arise between the members also play a role in needing  lawyer to resolve them and a lawyer will ensure the appropriate structure and documentation in company procedures.

Much more important from my point of view is the lawyer's task may be to facilitate the correct decision as well. There are many people who are wish to engage in business entrepreneurship or may form a company because they are required to do so under the law, but do not know which corporate format is most advantageous for them. The range of options is wide, ranging from the individual entrepreneur (sole trader) up to the individual person simple company (DBA entity) into full limited liability companies (Kft.). There are also foreign companies who wish to do business with Hungary and need a local interface structure, and there non-profit business structures as well.

The articles of association of the company must be capable of providing smooth operation, but they may also undermine it: e.g. the quorum is to be used if the Partners consents are split. These options can be eliminated foreseeing potential problems and drafting the document correctly.

Sometimes a client desires to create a sole trader or business association with members, but has never done it before and does not have any experience in this field. Among them there are some who seem utterly inadequate for the task, there is no realizable idea or they poorly assess the market opportunities, which, after some conversation with the lawyer usually turns out to be clarified. In such cases, we assist by to exploring honestly with the client, their aims and intentions, and then put the company into a properly planned legal and economic framework to mitigate any foreseeable pitfalls and difficulties that may be expected, and this will protect these clients to remain very realistic and to expect disappointments or difficulties.

With regard to the legal supervision of the company, problems may start if when for example, the company's registered office is not located at the declared address or it does not file the required documents to the authorities or it operates in some other form that are deemed to be illegal. It is possible to recover from these types of issues with qualified legal representation.

My office incorporates a senior accountant, a qualified auditor, a private detective firm and asset management organization under a full legal relationship, so with the exception of offering seats of address for companies, our office may be considered a full service operation for all corporate law and accounting requirements and activities.

 
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