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10 January 2017, 14:33

Business intelligence system for contemporary lawyer

Daniel Globa
Daniel Globa Deputy Director on Legal Affairs of “YouControl" company, the lawyer

At first glance, the work of a lawyer is conservative. One would think that in this long-standing profession nothing innovative could be used, except maybe the regulatory framework, and a text editor.

Our life is changing constantly, and with it changing the conditions and intensity of work, as well as requirements for the quality of case studying, including deep legal analysis of the participants (suppliers, competitors, parties to judicial proceedings etc.). In this case is especially important: 1) to explore as much as possible data sources to provide a "complete picture", 2) to ensure the reliability of the received information and also the its relevance at time of receipt, 3) possibility of instant access to the necessary information, excluding long «request-response» periods, 4) to ensure in-depth research along with the speed of execution.

Achievement a high quality of such analysis is possible only with the combination of the specified factors. Today it is unthinkable without the use of modern IT-technologies and special software. The latest technical solutions greatly increase the effectiveness of personally each employee's and legal team work in general.

In practice, most of the information about legal entities lawyers have to find by monitoring a plurality of separate resources, such as USR (Unified State Register of Legal Entities And Natural Persons - Entrepreneurs and Public Formations), ULR (Uniform License Registry) USRCD (Unified State Register of Court Decisions), SMIDA (Stock Market Infrastructure Development Agency of Ukraine), SFS of Ukraine database and others. At the same time, access to information is frequently accompanied by the necessity of registration, input of CAPTCHA, personal user identification with digital signature, and other obstacles, which do not allow quick extraction of the necessary information.

Let us consider the benefits of business intelligence systems on an example of the analytical platform YouControl, which concentrates information from the overwhelming majority of official registers. With it in just a minute, you can get actual (on time of the request) information about every legal entity or a private entrepreneur of Ukraine from more than 30 official sources and be warned about the changes of this data. Let us show on concrete examples how, in practice, this platform can be useful to a lawyer.

Identification of legal defects (whether the legal entity is in status of termination/bankruptcy or already terminated), in practice, will help to prevent possible financial losses and avoid cooperation with fictitious entrepreneurs. For example, the contracts concluded by the debtor after the commencement of bankruptcy proceedings or during the year before the initiation of bankruptcy proceedings could be declared null and void.

"Litigation presence" The system automatically concentrates all the court decisions (both final and procedural) in the dossier of the subject indicated in the text of these decisions. In this case a lawyer has the ability to sort court decisions by criteria: form of litigation, decision date, party, the amount of penalties. Permanent automated monitoring of judicial decisions taken in relation to companies will prevent to overlook any court document and allow to forget about manual search.

Affiliates. The system implements the search function of the links between companies, which allows to show information about affiliated entities like a web, including related persons within the meaning of the Tax Code of Ukraine. Thus, you can define the links (by the founders, managers, beneficiaries, matching the locations, names, contact information, etc.) between different subjects which, at first glance, have nothing in common.

From the practical point of view, checking of the links will help to avoid the risks of inspections and sanctions (first of all - penalties and additional charge of tax liabilities), as well as to prevent risks of involvement in criminal activities, as it will prevent unwanted connections in advance. For example, the tax authorities often conduct inspections of those partner companies related to fictitious entities (primarily with the "tax holes"). "Linked" manager may occupy a similar position in dozens of different companies where he or she most likely will not perform the actual administrative functions (ie he or she is a “puppet”) – this is a clear sign of fictitious entrepreneurship. Location at address of "mass registration" also attracts the attention of controlling bodies.

Checking of the links may also be useful in the conduct of anti-corruption and compliance investigations on the detection of potential conflicts of interest both in government bodies and in companies.

Tax "docking". To determine the optimal tax minimization schemes for payments, each subject in the dossier shows the current tax status, including data on the tax group and rate, dates and reasons of possible annulment of registration as a VAT (or single tax) payer, as well as the existence of the tax debt.

Checking of permits and licenses. The system displays all the information about the licensing documents of the company, including the type of permitted activities, issuing authority and expiration date. These data will help to avoid the risks of participation in the relevant illegal (and sometimes criminal) unlicensed activities.

Corporate verification. Data of the system can be used by lawyers in preparing and signing of instruments in sphere of corporate law, formation of appropriate legal positions in litigations, assessment of influence of shareholders on the company's situation, etc. The dossier of each company contains the information about its shareholders, distribution of their shares (with information about payment for shares). Information on statutory limitations of directors/signatories of the company allows to specify (in advance) all the nuances and avoid risks when entering into contracts or committing other acts of legal significance.

History of registration data changes (for example, about the shareholders, directors, types of economic activity, the amount of the authorized capital or the change of the name, location, etc.) allows to define credentials of a company director on a specific date. This information can be extremely useful in assessing the legitimacy of the documents, in formation of legal positions in corporate disputes or disputes on invalidation of transactions, in legal qualification of offenses or crimes, etc.

Countering hostile takeovers. For a lawyer is especially important to check the risk of own company and/or client companies on a subject of illegal registration data changes (changes in the management, the size and distribution of shares, official location, etc.), as well as the initiation of litigation and criminal cases, the purpose of which is to capture the business.

All these tasks are performed with the help of automatic monitoring – innovative feature and main advantage of the System. You can put in the list of monitoring one company or even tens or thousands of companies and the System will automatically keep track of them, sending alarm messages by e-mail.

Information on inspections of controlling bodies will help the lawyer get ready for their realization: to inform the company's management and business units, to address deficiencies in the documentation, to instruct employees, etc.

The above are only general functions of YOUCONTROL system. Every legal activity has a huge number of nuances in each of which this system can be used as a “fine tuning” tool.


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