Whether you are at the verge of starting a business relationship with a Latin American or Caribbean company, or you have a claim on a business in Latin America or the Caribbean: it is fundamental to gather the appropriate information about your business relationship.
You should always ask your business partner for basic information including corporate structure, tax numbers, commercial referrals and identification documents of its principals. This information may turn out to be vital later on in the business relationship, as you just never know when you start doing business if there will be concerns or claims, or if simply such information will be required in connection with for example credit insurances or logistic purposes.
In addition to what your business relationship provides from their own sources, you can do your own independent company research as part of your due diligence and compliance procedures for Latin America and the Caribbean.
There are companies specialized in providing B2B information research services, and servicing specifically international companies. Often such companies operate in account receivables or debt collection sectors.
Below is some of the information list we recommend each foreign company that does business in Latin America and the Caribbean, to search for.
The company’s corporate structure
What type of a company is your business relationship? Is it a sole proprietorship or is it an incorporated business with limited liability? When was the company founded? Where is the company registered and to which national and local jurisdiction(s) is your relationship subject? All very important information to determine the legal nature of your business relationship.
Assets and financial situation of the company
How much is the starting capital of your business relationship? Are there financial statements available or deposited at local registries or chambers of commerce? Which are the principal assets of the company? Does it possess real estate and is there any lien on such properties? Is there any information on your relationship’s payment behavior available? This information might be essential for providing credit lines and for any future claims on your business relationship in Latin America or the Caribbean.
Your business relationship’s commercial activities and operations
Which are the principal commercial activities of your business relationship? Where does these activities take place; which is or are the principal place(s) of business? Is there information available on providers or vendors? Does your business relationship represent any other foreign businesses? Are there commercial referrals or testimonials available concerning your business relationship? This information is essential to get a feel of performance of your relationship, before you enter into a deal or to compare with your experiences.
Executives and owners of the company
Who are the main executives of the company? And who are the owners, the shareholders or otherwise the principles? Do they have any links to other businesses and is there any information on them available, or referrals or testimonials? Be sure you gather this information as these people will be the ones who eventually take the decisions on your business relatonship’s end.
Legal information and law suits your business relationship is involved in
Is there any legal information available on your business relationship, like lawsuits? This information may provide you with indications on possible defaults, amongst others, or otherwise legal conflicts your business relationship in Latin America or the Caribbean is involved in.
We recommend international companies that do business in Latin America to assess the following information on (potential) business relationships in Latin America and the Caribbean: the corporate structure, assets and financial situation, commercial activities and operations, executives and owners, and legal information and law suits.
Cobroamericas is a boutique service providers offering debt collection, credit consultancy and company research information services to international companies doing business in Latin America and the Caribbean.
To participate in the conversation about debt collection in Latin America please join the Linked-In Group Debt Collection Latin America.