Counterparties. This term is encountered by many representatives of various fields of activity. Among them are students, and economists, as well as entrepreneurs and civil servants. The term itself came from the Latin word (contrahens), which in translation sounds like "negotiating."
Who are the counterparties? In a broad sense, these are completely different participants in business processes, but united by one key common feature, namely: they are all opposite parties to a contract. The contract can be absolutely anything, for example, a purchase and sale, a rental contract between a company and a supplier, a manufacturer and a distributor. Based on this, we can conclude that counterparties are both individuals and legal entities.
The most common types of counterparties are:
- Buyers
- suppliers;
- banks;
- third-party firms providing work or services;
- participants in auctions and tenders;
- distributors of products;
- partner companies.
Work with the last of the listed contractors requires special care and attention on the part of the entrepreneur. Situations are different, for example, an unscrupulous company, scammers, so-called “one-day firms” who want to cheat or use the contract with you solely for their own purposes may turn out to be a potential partner. You might want to check a potential partner, your counterparty.
How to check a counterparty?
Counterparty verification is a fairly broad term. Under it can be understood several methods of collecting information carried out for one purpose or another.
Of the methods most popular are the following:
- Verification by self-collection of information.
- Verification involving common partners.
- Check by TIN.
Counterparty for TIN
A TIN check is one of the most reliable and easiest ways to find out if your counterparties have problems. This is a very common method, which consists in the fact that you enter a TIN or PSR request of a prospective partner on a certain online service and get detailed information about the presence or absence of tax debts, loans, legal problems or other work-related issues organization and its reputation.
There are more advanced databases and registries, both state and independent. They provide various information, such as past due obligations, various paperwork, availability of licenses.
Potential problems due to dishonest partners
It should be remembered that insufficient attention to the business reputation of your business partners can lead not only to losses, but also to the loss of your own reputation. Problems with potential partners' taxes or debts will mean that the company may try to trick you or simply not have the money to pay you back. For example, if a company is in a pre-bankrupt state or under conditions of a severe reorganization, they may simply forget about you.
Legal threats
In some cases, such firms can create you not only financial, but also legal problems due to the use of their services. This is especially true of authorized and responsible persons in municipal and state enterprises that operate with budget funds. It is quite possible that fraudsters and one-day firms can enter various auctions and tenders, which will entail grave consequences when their fraud is revealed.Lack of a license or tax litigation will become the basis for proceedings not only in relation to firms providing services, but also in relation to financially responsible and authorized persons of budget organizations. Charges of negligence and conspiracy with similar fraud firms may be charged. Be careful and remember: counterparties are almost a mirror of your company.
