Choosing the most appropriate structure for your investment or business venture is a critical first step, and a variety of issues need to be considered. Kensington Swan has the expertise and experience to guide you to a business structure that best meets your unique needs. This may be at the commencement of your venture or as part of a restructure as your needs change.
It is critical to understand your objectives before choosing a business structure. Getting your structure right from the outset avoids the added cost, change to internal procedures, and confusion for customers that comes from restructuring at a later date. The choice of appropriate structure is a balancing act among the many legal and commercial issues, and advantages and disadvantages of different structures. Issues to consider include:
- nature of assets and industry involved
- statutory compliance requirements
- tax issues
- control and governance
- extent of liability
- exit and entry options
- succession plans
- funding options
- the nature and number of parties involved.
Kensington Swan will work with you to ensure you understand and are comfortable with the structure selected and that it best suits the nature of your business and industry, and your commercial objectives and plans for the future.
Business structure options
There are many business structures available, including companies (limited liability and unlimited liability), partnerships, limited partnerships, joint ventures (incorporated and unincorporated), co-operative companies, incorporated societies, unit trusts, discretionary trusts, and charitable trusts.
There are no hard and fast rules when it comes to selecting a business structure. Your chosen structure should reflect what you're most comfortable with, as well as the size and type of your business and your plans for the future.
New Zealand Medicines Formulary limited partnership
Our client wanted to form a joint entity to contract with the Crown to establish a New Zealand Medicines Formulary. We advised on a unique structure, utilising a limited partnership as the contracting entity, involving parties in different jurisdictions (New Zealand and United Kingdom) and with different structures, including companies and incorporated societies. We helped to achieve a governance structure appropriate for the venture, which is a ‘look through’ for tax purposes while maintaining limited liability for each partner.
Gaming in New Zealand is subject to very specific regulatory requirements. When a client wanted to restructure its activities, and apply for a licence to conduct class 4 gambling (operating gaming machines at third party venues), we recommended a unique structure—a limited liability company that had no power to make a profit and could only apply net proceeds for authorised purposes under the gaming legislation. This provided our client with an entity that met its charitable and other non-commercial objectives, as well as satisfying the legal requirements for entities eligible to conduct class 4 gambling. Our client was successful in obtaining a licence.
Related legal services
Corporate and commercial law
Commercial contract law