The concept of a legal opinion
A legal opinion is understood as a document that contains the professional opinion and conclusion of a lawyer who has studied a particular legal problem. Through such a document, the parties to the transaction will be able to understand all the nuances of concluding an agreement, explained from a legal point.
Often, obtaining a legal opinion is required when concluding a financial transaction. In some cases, a legal opinion may be a prerequisite for such a transaction. Below we will consider the cases in which a legal opinion may be needed, and in what form it exists.
When legal opinion is required?
- Launching of ICO.
The purpose of the ICO is to raise funds through the sale of tokens to interested investors. Some countries have established their own rules regarding ICOs, however, in a number of states, even in their predominant number, ICOs are not regulated. The need for a legal opinion arises in order to determine, for example, whether a coin, in accordance with its functions, can be considered a security or financial instruments within the jurisdiction where the investor or ICO is located.
A cryptocurrency asset trading platform may request a legal opinion for the reason that it needs to operate in accordance with the provisions of national legislation that apply to cryptocurrency exchange transactions. The lawyer who issues the legal opinion must be well acquainted with the cryptocurrency rules in force within a particular jurisdiction.
- The parties enter into an international deal.
International transactions generally require a legal opinion. This is especially true when buying a foreign company, securities, real estate abroad or when obtaining a loan.
In particular, consider the following example. If one of the companies involved in the transaction is registered in Luxembourg, then the other party can request a legal opinion from any of the legal offices of that jurisdiction. The law firm will have to provide confirmation that the firm is in fact registered within Luxembourg and that all of its documents are in the correct state. The lawyer will have to confirm that the company can become a party to the transaction.
- The parties conclude an investment agreement.
If a start-up and a fund expressing an agreement to provide funds enter into a deal, the start-up may ask for a legal opinion regarding the investor. In order to assess all the risks and resolve questionable issues before concluding an agreement, entrepreneurs who need additional funds to develop their own business turn to a lawyer.
With the help of a legal opinion, it will be possible to clarify whether a particular Forex broker, virtual casino or any gambling business has the right to provide services within a particular jurisdiction. In this case, a legal opinion is sent to Visa, MasterCard, a banking institution or another payment system operator in order to confirm the legality of the transactions.
- Transactions for the sale or purchase of real estate.
With a legal opinion, a potential buyer will be able to see if there are any risks for him when concluding a real estate purchase transaction. The buyer will also be explained exactly what obligations will be imposed on him when owning real estate.
Moreover, here are a few other cases in which you may need to get a legal opinion.
- If you would like to know about the licensing rules applicable to your commercial project.
- When you need to know if your potential partner has had any criminal problems in the past.
- If you want to have an idea of the minimum threshold for wages in a particular jurisdiction.
- If you would like to know about the provisions of the legal framework governing the processes of hiring and firing employees.
- When you need to know about the requirements for the functioning of trade unions.
- In some other situations of a legal nature.
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