Fostering the Spirit of Entrepreneurship – Legal Requirements for Entrepreneurs [opinion]

TO make a success of their enterprises Namibian entrepreneurs must ensure that they understand the law, so that they protect their business and assets. Running any business involves legal requirements in one way or another or sometimes every day. Not understanding the Namibian law can be devastating for some business owners, as people with whom you engage in business transactions can cheat you. In this column we will highlight a few things you need to be aware of about the law.

First, never try to ignore the law. If you really want to be successful you cannot at any stage afford to bury your head in the sand. It is important that we all understand the law as it pertains to running a business in Namibia. It becomes critical to understand the labour law as it is the essence of nearly every business and as an entrepreneur you are required to have a very good working knowledge of it.

Second, lifelong learning is a great component as knowledge gives you power in business. If you become successful as an entrepreneur in terms of empowering yourself with essential knowledge it gives you the edge in negotiations as legal requirements deal around contracts.

Thirdly, protecting assets is key to ensure that your business becomes a success. Successful entrepreneurs operate under an entity that make most sense for themselves and their business, regardless whether as a company, close corporation, a trust, partnership or a sole trader. You must develop a sense to understand when to register holding companies or subsidiaries. Arm yourself with the knowledge and power that will enable you to protect your assets from creditors. Focus on ensuring the continuity of your business by structuring it correctly.

Fourthly, taxes must be paid, but ensure that you never pay too little or too much. Make sure that your business makes use of the escape hatches the Income Tax Act provides. Study the tax law and ensure that you do not pay more tax than your earnings. Setting up a well-drafted will, which takes tax laws into consideration, is essential.

Finally it is very important to understand the insights of the industry within which you open a business venture. Legal requirements are industry specific. For instance the food industry has its own set of laws beyond those that are general to all sorts of businesses. Business owners who venture into construction businesses need to be aware of environmental laws etc.

When looking into the legal requirements for setting up a business, as an entrepreneur it is sometimes important to do research on your own before seeking professional or expert aice.

As an entrepreneur you must develop the intuition and not be afraid to ask questions and not believe everything people tell you, unless you have confirmed it yourself that it is indeed true.

I am not trying to imply that all of us must become legal practitioners, but it is critical that we all try and equip ourselves with a sound knowledge of laws which might have both positive and negative implications on business.

– Dr Wilfred Isak April is a Unam graduate and holds a PhD in Entrepreneurship (New Zealand). He lectures in Leadership, Organizational Behaviour and Entrepreneurship at the University of Namibia.

Source : New Era