1. Structuring Family Businesses
Dr Johannes Bruski
AbdulAziz AlGasim
Structuring Family Businesses
A Step by Step Process

2. Structuring the organization
Legal issues relate to each step in the structuring process.
They must be dealt with in context.

3. Fact Finding: Goals
As part of the first step, fundamental business and other goals should be identified and ranked as a guideline for further review and (legal) structuring. These many include:
Ensure Long-Term Business Success and Resilience
Ensure Continued Family Influence
Ensure Orderly Succession
Ensure Fulfilment of Social Responsibilities
Provide for Fair Treatment of Exiting Family Members
Ensure Equal Treatment of All Family Members
Ensure Respect for Family Values And Enterprise Culture
Ensure a Proper Separation between Family Members as Shareholders and as Business Managers
Minimise Costs and Expenses of the Chosen Structure

4. Fact Finding: Risks and Issues
An indicative list of typical risks and issues is given below (not necessarily exhaustive):

5. Defining Policies: Identifying Typical Issues
It may be helpful in exploring the position the family and the owners wish to take in respect of the following issues that are present in many family businesses and may require particular (legal) solutions.

6. Defining Policies: Identifying Success Factors
It may be helpful to single out the factors that have been relevant for the success of the family business in the past or that may be conducive to continued or even increased success in the future. These may include (but not be limited to):

7. Defining Policies: Fundamental Decisions
Family and/or owners should agree on fundamental structural, strategy and policy decisions. These may include, inter alia:

8. Putting it together: The Final Structure
Basic Agreement on Fundamental Principles
Family Council and Family Office
Governance Related Options
Terms and Conditions of a Transfer of Shares (or equivalent rights)
Certain Policies
Sanctions in Case of a Violations of Agreements
Liquidity Programs for Owners
Risk Diversification and Ring Fencing
Management of Passive Assets and Family Office
Contingency Planning for Identified Risks
Tax Planning
Estate Planning

9. The Final Structure continued
Basic Corporate Set-up Alternatives
Pooling Company Structure
Holding Structure
Domestic Trust Structure
Family Foundation Structure
Foreign Truest or Foreign Family Foundation Structures
Pooling Agreement Structure
Closed Investment Fund Structure

10. Questions?
These are presentation slides only. The information within these slides does not constitute definitive advice and should not be used as the basis for giving definitive advice without checking the primary sources.
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