Manage Your Business Risks with Due Diligence in Argentina

Going through a process of due diligence in Argentina is the best way to identify and reduce the risks of expanding your business. It can enhance the growth of your company, encouraging trust and credibility within joint venture partners and distributors.

Find out how due diligence can guarantee your business’s success through multiple services in the areas of investigation, hiring staff, corporate intelligence, risk management, and IT security. 

A map of Argentina and its main cities. Manage Your Business Risks with Due Diligence in Argentina

What is due diligence?

Due diligence is an audit of a company carried out by an external consultant to identify risks in the seller’s business.

In other words, it consists of a process of research, compilation and analysis of information, which as a result generates a report with recommendations on the risks and opportunities of the potential business.

Professional due diligence also provides you with accurate conclusions on the state of the company’s patrimonial, financial, legal, labour, and fiscal situation. In some cases, it can also provide a quantification of potential risks and contingencies.

How to start a due diligence process on the right foot?

To start a due diligence process in Argentina, it is essential to guarantee the flow of information to reduce risks. The goal is to make the final report as transparent and clear as possible, which is difficult if internal or external information is not available in advance.

In order to manage your business risks you may need to answer questions like:

  • What is the security situation in the country I would like to expand?
  • Can I trust that my client will pay me when I deliver my services?
  • Are there any reputational risk with the groups I am working with?
  • Can I trust my Joint Venture partner?
  • Can I trust my distributors?
  • Who can I trust in my local representative?
  • When I arrive do I need physical security?

What value does due diligence in Argentina has to offer?

Due diligence allows the company to identify its strengths, opportunities, weaknesses, and threats. Regardless of the result of the potential operation, it is an opportunity for improvement.

In other words, it is a long process that merits business reflection. Knowing the information that is collected through a due diligence process, is always an advantage that will allow you to anticipate and solve possible problems.

Furthermore, you will present yourself to the negotiation with a deep knowledge of your company, vital to maintaining control and ensuring success.

A due diligence process will allow you to anticipate and solve problems.

Different applications of the due diligence process

Regularly, a due diligence process starts when two parties reach a commercial agreement. However, there are multiple types of due diligence processes and they can include the following applications:

  • Commercial: Involves an analysis of the competence and other commercial dynamics of different sectors.
  • Environmental: Foresees potential environmental risks. When assessed properly it can avoid potential environmental liabilities.
  • Financial: Measures financial opportunities and viability risks. This can include indebtedness, cash flow documents, potential investments, and other financial services.
  • Fiscal and tax information: Evaluates the company’s tax compliance issues, subdivisions, and tax administration history.
  • Insurance: Involves a review of historic claims and liabilities and can quantify contingent liabilities. Evaluates historic, current, and future risk exposures and insurance costs.
  • Labour: Analyzes the current labour legislation. It contains information related to individual employment contracts.
  • Legal: Includes a review of the company’s legal status. Includes, for example, criminal history, existing commercial contracts and financial information. 

Carry out your due diligence in Argentina with specialist support

Deciding to do a proper background check and engage a trusted due diligence provider will be advantageous for small and large businesses or individuals who are interested in doing business in Argentina.

Protect your company from non-compliance and other potential risks with due diligence services in Argentina. At Biz Latin Hub, our team of bilingual professionals have the knowledge and experience in due diligence reviews to ensure you make the best decisions when expanding your business in the region. Reach out to us now for personalized assistance.

Learn more about our team and expert authors

Infographic: Biz Latin Hub services.

The information provided here within should not be construed as formal guidance or advice. Please consult a professional for your specific situation. Information provided is for informative purposes only and may not capture all pertinent laws, standards, and best practices. The regulatory landscape is continually evolving; information mentioned may be outdated and/or could undergo changes. The interpretations presented are not official. Some sections are based on the interpretations or views of relevant authorities, but we cannot ensure that these perspectives will be supported in all professional settings.
Legal Team Argentina

Legal Team Argentina

Legal Team Argentina is the Biz Latin Hub leading experts on doing business in Argentina The Team writes on the news, doing business, law, and changing regulations. The team are experts in corporate law, Administrative law, Employment law, Immigration law and legal advisory services. Read more about them here. You can contact Legal Team Argentina via our "contact us page".

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