MLT AIKINS : Exploring New Markets: Know the Legal Risks

Expanding into new markets comes with legal risk –especially in today’s uncertain trade environment. This fall, Agricultural Manufacturers of Canada (AMC) partnered with MLT Aikins to host sessions for members to discuss key legal issues for ag manufacturers.

Entitled Strategic Expansion Amid Trade Tensions: Case Study Conversations & Legal Insights, four sessions took place in Edmonton, Regina, Winnipeg and Listowel in September and early October. Sessions were facilitated by Danielle Graff, Todd Thomson and Samer Awadh, all partners at MLT Aikins, a long-time corporate sponsor of AMC.

The goal was to provide AMC members with practical insights to mitigate legal risk and position their business for sustainable global growth. Sessions covered key topics that manufacturers should consider before entering a new market, including IP protection, contracting to minimize uncertainty, and corporate structure planning, encouraging members to share their own experiences.

“We help clients ask the right questions based on what we see from being broadly involved in the sector” says Graff, a self-described “farm kid” who grew up on a farm in Neudorf, Saskatchewan and enjoys staying connected to the ag sector. “We want to be confident that we help clients address these key risks to set up their business for success.”

That includes helping companies determine how they deal with uncertainty, a constant today with tariffs, exchange rate fluctuations and supply chain issues. With trade issues south of the border, some Canadian companies are looking at expanding into markets further afield.

“We are seeing organizations think differently about entering the U.S.,” says Graff, who had one client cancel plans to enter the U.S. despite spending months preparing to get into a key market for their business.

Before diving into the global marketplace, she says it’s important to be strategic and make sure your company is set up properly with the right structure and safeguards in place to be successful.

“Corporate structure planning is important – it’s a critical piece,” says Graff. “You need to have a plan for your business structure and have the proper supports in place.”

From a legal perspective, IP protection is also very important in the manufacturing sector. IP, or intellectual property, is the ownership of the expression of original ideas and creations and may be protected by law, such as patents, trademarks, and copyrights.

“As a business, you might have a proprietary innovation,” says Graff. “Protecting your rights in that innovation can give your business a competitive advantage.”

For any business, she recommends doing a baseline assessment of your existing IP to determine what you have, and the steps taken to protect it. It’s important to identify key products or services that are licensed, hosted, or sold by the company and any past, potential, pending, or threatened claims alleging infringement against the company’s IP. You should also determine if there is value in having registered protection and, if so, which mechanism is most appropriate.

“Owning IP is of limited value if steps are not taken to enforce and protect rights,” says Graff.

Knowing the legalities in the market you plan to enter is critical before you start doing business as different jurisdictions have different rules. You also need to consider your tax planning strategy and profit repatriation as that can be different for each market.

Graff credits AMC for being proactive and ensuring its members have the support they need when they need it.

“AMC is a tremendous organization,” she says. “It is extremely focused on what is most valuable to members right now.”

She stresses how important it is for companies and organizations to invest in the future and plan ahead.

“That’s a lesson that we’ve all learned this year,” she says. “It’s about longer-term thinking and looking at opportunities to determine a strategic path forward.”