Basic Legal Considerations Basic Legal Considerations for Swedish Businesses in for Swedish Businesses in

the U.S.A.the U.S.A.

Christopher N. Smith, LLCChristopher N. Smith, LLCAttorney at LawAttorney at Law

130 North Crest Blvd., Suite B130 North Crest Blvd., Suite BMacon, Georgia 31210 USAMacon, Georgia 31210 USA

Phone: 478-477-8145Phone: 478-477-8145Fax: 478-477-7823Fax: 478-477-7823

Email: Email: mcngalaw@mindspring.comwww.cnslaw.com

Macon and Atlanta appointments availableMacon and Atlanta appointments available

CaveatsCaveats

State Laws varyState Laws vary Issues discussed “Tip of the Iceberg”Issues discussed “Tip of the Iceberg” Labor Laws/Import requirements etc. not Labor Laws/Import requirements etc. not

discusseddiscussed The key is doing things in the proper orderThe key is doing things in the proper order

Three Pillars of SuccessThree Pillars of Success

Legal StrategyLegal Strategy Accounting StrategyAccounting Strategy Insurance StrategyInsurance Strategy

All must be coordinatedAll must be coordinated

Tax Identification NumberTax Identification Number

Must have to open bank accountsMust have to open bank accounts Required to Inform US Dept of Commerce Required to Inform US Dept of Commerce

that US Subsidiary formedthat US Subsidiary formed Accountant needs to know when attorney Accountant needs to know when attorney

incorporatesincorporates Communication among all team members Communication among all team members

importantimportant

Legal Forms of U.S. BusinessesLegal Forms of U.S. Businesses

Sole ProprietorshipsSole Proprietorships General General

PartnershipsPartnerships Limited PartnershipsLimited Partnerships CorporationCorporation

Limited Liability CompanyLimited Liability Company Limited Liability Limited Liability

PartnershipsPartnerships US Branch of Non US US Branch of Non US

CorporationCorporation Others, Joint Ventures, etc.Others, Joint Ventures, etc.

Swedish owned Subsidiary in USSwedish owned Subsidiary in US

Vast majority “C” corporationsVast majority “C” corporations ““C” corporation recommended due to C” corporation recommended due to

accounting advantagesaccounting advantages Not eligible for “S” corporationsNot eligible for “S” corporations Limited Liability Company permissibleLimited Liability Company permissible

Incorporation ProcessIncorporation Process

Name reservationName reservation Filing of Articles of Filing of Articles of

IncorporationIncorporation PublicationPublication Adoption of BylawsAdoption of Bylaws Election of OfficersElection of Officers Organizational Organizational

MinutesMinutes

Adoption of SealAdoption of Seal Issuance of Stock Issuance of Stock

SharesShares Adoption of Adoption of

Shareholders Shareholders AgreementAgreement

Notification to U.S. Notification to U.S. Dept of CommerceDept of Commerce

Time Frame (In Georgia)Time Frame (In Georgia)

Normal 3 to 4 weeksNormal 3 to 4 weeks Expedited 1 to 3 daysExpedited 1 to 3 days Filing Fees $125Filing Fees $125 Expedited Filing Fees $225Expedited Filing Fees $225 Publication Fee $40Publication Fee $40 Corporation Book $75 est.Corporation Book $75 est. Plus Legal FeesPlus Legal Fees

Why Incorporate?Why Incorporate?

Corporate ShieldCorporate Shield Avoid Personal LiabilityAvoid Personal Liability Reduce exposure for parent companyReduce exposure for parent company

LiabilitiesLiabilities

Business and Contractual ObligationsBusiness and Contractual Obligations Liability for TortsLiability for Torts Products LiabilityProducts Liability

Business and Contractual Business and Contractual ObligationsObligations

Get it in writingGet it in writing Do not personally Do not personally

guaranteeguarantee Do not bind parent Do not bind parent

corporationcorporation Signature Law Signature Law

importantimportant

Sign under correct Sign under correct corporate namecorporate name

Always sign with Always sign with corporate titlecorporate title

Arbitration/Venue Arbitration/Venue ClauseClause

Research Your Business Research Your Business AssociatesAssociates

An ounce of prevention is worth a pound An ounce of prevention is worth a pound of cureof cure

Research history of litigationResearch history of litigation Lien index searchLien index search Judgment searchJudgment search Bankruptcy filing searchBankruptcy filing search Done secretlyDone secretly

General Insurance IssuesGeneral Insurance Issues

General LiabilityGeneral Liability Protect the Protect the

companycompany Protect Officers Protect Officers

and Directorsand Directors Protect Business Protect Business

OwnersOwners Product LiabilityProduct Liability

Reservation of rightsReservation of rights Umbrella PoliciesUmbrella Policies Respondeat SuperiorRespondeat Superior Workers CompWorkers Comp Research Insurance Research Insurance

CompanyCompany Read Insurance PolicyRead Insurance Policy

TortsTorts

Personal InjuryPersonal Injury Auto AccidentAuto Accident Slip and FallSlip and Fall Wrongful DeathWrongful Death Negligent SecurityNegligent Security OtherOther Special DamagesSpecial Damages Pain and SufferingPain and Suffering

Respondeat SuperiorRespondeat Superior

Employee within scope of employmentEmployee within scope of employment Employee causes injuryEmployee causes injury Employer vicariously liableEmployer vicariously liable Adopt safety policies to reduce riskAdopt safety policies to reduce risk Cell phone dangersCell phone dangers

Elements of Products Liability CaseElements of Products Liability Case

Restatement of Torts Restatement of Torts Section 402ASection 402A

One who sells productOne who sells product Defective conditionDefective condition Unreasonably Unreasonably

DangerousDangerous Physical Harm to UserPhysical Harm to User Or Property DamageOr Property Damage Seller engaged in Seller engaged in

business selling business selling productproduct

Product reaches Product reaches consumer without consumer without substantial change in substantial change in conditioncondition

Care not a defenseCare not a defense Privity not requiredPrivity not required Strict liabilityStrict liability

What is a Defective Condition?What is a Defective Condition?

Risk Utility AnalysisRisk Utility Analysis Consumer Expectation AnalysisConsumer Expectation Analysis Combination of bothCombination of both

What is Unreasonably Dangerous?What is Unreasonably Dangerous?

More dangerous than expectationsMore dangerous than expectations Average reasonable consumer testAverage reasonable consumer test Known vs. unknown characteristics of Known vs. unknown characteristics of

productproduct

Products Liability TheoriesProducts Liability Theories

Manufacturing DefectsManufacturing Defects Defective WarningsDefective Warnings Design DefectsDesign Defects

ConclusionConclusion

Good news, U.S. offers great opportunitiesGood news, U.S. offers great opportunities Number one economy in the worldNumber one economy in the world Hire team of professionals from day oneHire team of professionals from day one Legal, Accounting InsuranceLegal, Accounting Insurance Useful LinksUseful Links Questions?Questions?