International document retrieval: The challenges and complexities

There are many steps to follow when closing international corporate transactions. One step that may seem straightforward is retrieving documents, such as good standing certificates (or the country equivalent) and formation/charter documents.

However, when dealing with different jurisdictions with their own legal systems and languages, it can be challenging for attorneys to perform this due diligence work for their clients outside the U.S. in a timely and efficient way.

In this article, we’ll review some of the intricacies of fulfilling international document retrievals as part of the due diligence process.

1. Document naming convention differs between jurisdictions

The international equivalents of documents and/or filings may have different names and are governed by different laws than those in the U.S.

For example, the concept of “good standing” does not exist in other jurisdictions. The equivalent of a good standing certificate might be a certified extract, certificate of existence, or HRB certificate, as it's called in Germany, but none of these may officially convey the meaning of good standing as it's known in the U.S. The benefit of having an experienced partner that can assist with document searches is that you can obtain the help you need to determine what documents may be available to meet your requirement. 

Another document with different nomenclature is articles of incorporation which can be called charter documents, memorandum of association, and more. What is commonly known as a bring-down letter is referred to in other countries as a comfort letter, verbal status report, or profile report.

Outside the U.S., and those countries not part of the Apostille Convention, an apostille certificate would not be available, and instead, an authentication certificate or the legalization of documents must be obtained. 

2. Supplemental documents may be required

It’s also important to note that when searching for a U.S. equivalent document in another country, the information required may not match one-to-one and additional documents may be required, adding time and complexity to the retrieval process.

For example, copies of a company’s formation or incorporation document may not always reflect amendments, changes, and appointments. Instead, those documents must be ordered separately. In Germany, things are a little different and this information is included in the HRB certificate (equivalent to a certificate of good standing). Even within the same country, documents can differ from city to city or state to state.

Health checks and credit reports can also be inconsistent across countries, with the information differing based on what’s available in each jurisdiction. Similarly, litigation and judgment search reports can vary. In the Cayman Islands, a popular jurisdiction for incorporation, reports will include both pending litigations and judgments, whereas, in the UK, these reports must be ordered separately.