During the academic year 2020/2021, our firm joined the Legal Advice Program (LEAP) of The University of Hong Kong, a program bringing law firms and law students together to provide pro bono legal services to the community. At around the same time, our firm was also developing our New Economy Department, which aims to provide legal services catering for the needs of start-ups at each stage of their lifespan. Below, we have set out a summary of 2 cases in which our New Economy Department worked with students from LEAP to provide services to our clients.
Case 1: Preparation of Shareholders’ Agreement
Counter-intuitive as it may sound, it is in fact quite important to have a shareholders’ agreement in place when setting up a business with friends or family members. A shareholders’ agreement can safeguard the interests of both the majority and minority shareholders, make management of the company more efficient and, most importantly, provide fallback measures when disputes arise between the parties.
We assisted in the preparation of a shareholders’ agreement for a rising tech company in the agriculture industry before the commencement of its fundraising campaign. Upon proper consultation and discussion with the client, we tailor-made a shareholders’ agreement that caters for its special needs with anticipation of the growth of the company.
Case 2: Advising on Regulatory Compliance
Failure to comply with relevant regulations can be devastating to a business. It is, however, sometimes difficult for entrepreneurs without legal backgrounds to tell whether they have complied with all the regulatory requirements. Thus, it would be prudent to obtain legal advice in this respect at the outset of the business.
We once advised an app developer who intends to launch an app that can interact with retail investors intelligently. It is envisaged that the app can, for example, respond to the users’ unique requests, gather news the users interested in and recommend to the users what it believes to be a suitable investment package.
With a full picture of the client’s innovative products in mind, we advised on the potential risks that the client may face upon launching the app, which include potential violation of privacy policy. We addressed this concern by preparing a set of bespoke disclaimers of the privacy policy for the intended app.
Apart from the above, our New Economy Department also provides services on, to name a few, fundraising, employee incentive arrangements and pre-IPO advice. Detailed information can be found on our website: https://startup.hksunlawyers.com