Effect of backdating
Effect of backdating - Meet fuck split
On the other hand, if the document is executed after the event has occurred but accurately reflects the date of the event, the backdating is a proper memorialization.
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One of the most common legal issues which arises in the context of intercompany agreements is whether a particular agreement can be backdated. Giving a document a date which is earlier than the date when it was actually signed would almost certainly constitute fraud.
Ashley Fife explores backdating and the 'effect date', including backdating appropriateness, problems with backdating, and recommended practice.
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Clearly, the ideal position is to put in place the relevant intercompany agreement in advance, as with any commercial arrangement.
The options available here depends on the proposed terms of the agreement, and whether it can be said that the relevant arrangements are already in operation.
Whenever any form of backdating is proposed, it is important to review the facts carefully.
Additional due diligence should be considered in order to manage the risk of any unintended liabilities being triggered, and to make sure that the legal effect of the relevant arrangements is as intended.
The seller/principal may agree with the local sales companies to treat the arrangements as they had been in place as from the previous year end.
This could involve putting in place agency agreements now, which are dated when they are actually signed.
For example, the date when the event itself occurs can be uncertain.