Real-World Solutions To Real-World Challenges

How does New York’s regulatory environment affect corporate transactions?

On Behalf of | Jun 18, 2024 | Business Law |

In the city that never sleeps, business leaders must do more than close deals. They must structure deals that avoid a myriad of regulatory hurdles. There are steps that can help to better ensure dealmakers do not stumble on these hurdles. Three examples include the following.

1. Due diligence: More than a box to check

Savvy dealmakers know to scrutinize every nook and cranny before moving forward with transactions like merger and acquisition (M&A) deals. New York’s regulatory bodies — think the New York State Department of Financial Services and the Federal Trade Commission — keep a hawk-eye on these deals. The rules are complex and vary depending on the type of business structures involved, location of target company, and type of business conducted. Compliance is not optional.

2. Brownfields and beyond: Real estate roulette

Brownfield sites are not just abandoned lots; they are potential goldmines. Developers are wise to move forward with caution. Business leaders are wise to take environmental regulations seriously. Cleanups, permits, and liability assessments can quickly add to the expense of the deal. But the risk may be worth it as brownfields can bloom into prime real estate if you play your cards right.

3. Pollution perils and endangered species: A regulatory roadblock

New York’s air and water quality are not up for debate. Violate environmental standards, and you will face a legal headache. Fines, penalties, and reputational bruises await the reckless.

Although not as common, some developers are also wise to watch out for the potential impact of endangered species. Regulatory authorities may step in if the plans impact a species on the list.

In the concrete jungle, business leaders must balance their interests with applicable regulations. Federal and state rules are not mere speed bumps; they are the GPS guiding your deal’s journey.