Why Washington State?
Starting a new business or entering a promising industry is always an exciting and challenging undertaking and Washington State is the right location to start, grow and expand your business ventures. It is a unique place where new ideas, nurtured in a dynamic and business-friendly environment, become international icons. Companies like Starbucks, Boeing, Microsoft, Nordstrom and Amazon have not only become highly revered brands, but have changed the very face of their respective industries.
Washington State is worldly known for its most successful industries and such include Aerospace, Renewable & Clean Technologies, Information & Communication Technologies, Agribusiness, and even Life Sciences. For example, with more than a 1,000 firms in its aerospace cluster and global leader in the industry, Washington’s aviation history draws back to more than a century of developing and building products and services for major manufacturers and airlines throughout the world.
For international investors, Washington State is a major player in developing projects and investment opportunities in the new and renewable energy sources sector, utilizing wind, solar, tides, biofuels, and biomass technologies. Defined by its culture of innovation, not only does Washington State attract a highly skilled workforce, but it also stands more and more as a centralized hub of startups and information technology software companies, including legendary businesses such as Microsoft, Google, Facebook or Amazon – reaching to a new generation of entrepreneurs and investors.
Advantages and Incentives of Doing Business in Washington State
Washington State has 39 counties to choose from. Each county offers a different set of competitive business advantages. Equidistant between Europe and Asia, Washington States’ ports and marine industry serve as a gateway to opportunity and a platform to reach global markets. As for an example, leading producer of apples, sweet cherries, pears, raspberries and hops, the state’s 36,000 farms grow, produce and ship 300 different crops throughout the world, ranking second in the nation.
One of the main incentives for any international investor, when considering in acquiring or partnering in a business venture in Washington State, resides in an attractive business-oriented taxation system. In addition to having no personal or corporate income tax, the state offers innovative partnerships at the state, regional and local level to facilitate your business relocation and increase your growth potential.
Alongside the tax incentives detailed above, Washington has 11 Free Trade Zones (FTZ) which refer by essence to business zones considered to be outside the U.S. Customs Territory. FTZ can offset customs advantages available to overseas producers who compete with domestic producers. Its purpose is to help expedite international trade and exports, attract offshore activity, greatly reduce the cost of doing business and simplify processing and entry fees as well as creating employment opportunities.
What Are the Benefits to a Zone User?
- Duty Exemption. No duties on or quota charges on re-exports.
- Duty Deferral. Customs duties and federal excise tax deferred on imports.
- Inverted Tariff. In situations where zone production results in a finished product that has a lower duty rate than the rates on foreign inputs (inverted tariff), the finished products may be entered at the duty rate that applies to its condition as it leaves the zone (requires prior authorization).
- Logistical Benefits. Companies using FTZ procedures may have access to streamlined customs procedures (e.g. “weekly entry” or “direct delivery”).
- Other Benefits. Foreign goods and domestic goods held for export are exempt from state/local inventory taxes. FTZ status may also make a site eligible for state/local benefits which are unrelated to the FTZ Act.
Also, the Washington State Department of Commerce through the work of a trusted and experienced Business Services team offers to registered Washington State businesses its services for free. These services include assisting interested parties in effectively locating a business in Washington, finding new partners, researching and entering new markets. Expert teams advise investors on finding direct investment opportunities in Washington, identifying a site for expansion or location, and guide you towards likewise industry professionals.
Merger & Acquisitions (M&A), Joint-Ventures (JV) and Due Diligence
There are numerous ways of engaging in business in Washington State that fit different needs and purposes. Sometimes, instead of starting a new business or growing the entity organically, there are other options available, such as Merger, Acquisition, or Joint Venture with another entity.
A Merger entails a process when two companies jointly agree to move forward as a single new company. Acquisition refers to a situation where a company takes over another and clearly establishes itself as the new owner. Generally, mergers and acquisitions are usually completed by the team of professionals, including attorneys, investment bankers and accountants. All together, the team works in harmony to maximize the success of the transaction.
A Joint venture consists in a business arrangement in which two or more parties agree to pull together their resources for the purpose of accomplishing a specific task or project. In this type of arrangement, the venture is its own entity, separate from the other participants’ other business interests.
There are numerous benefits to the business arrangements mentioned above. Increased market share, product lines, profits, in some cases even tax benefits. All of it depends on the business set up and on the company you acquire, merge, or create a joint venture with.
In this regard, no matter what transaction might be of interest, it is crucial to perform due diligence. Due diligence is an investigation or audit of the potential investment. In this case, this is an investigation of the company for the transaction. Due diligence is especially important from a buyer’s standpoint. It allows the buyer to understand the business and identify any potential problems or issues, it also allows the team of professionals (especially your attorneys) to understand the nature of the transaction and come up with the best strategy.
Due diligence can also effect the purchase price. Failure to perform due diligence can defect a common law claim for fraud, meaning that generally, if the buyer cannot recover on a fraud claim if the alleged material omission or misstatement could have been discovered through the exercise of due diligence.
Our Services as an International Washington-Based Law Firm
At CHUNG, MALHAS & MANTEL, PLLC, our attorneys understand that effective legal counsel is essential to the success and efficient functioning of your business, whether your business is in the seed or start-up stages, the growth stage, or beyond. Since even minor disputes can disrupt corporate operations and profitability, our attorneys work closely with clients to understand the goals of the business and avoid the many pitfalls that accompany business and commercial transactions through careful planning and execution to ensure smooth business operations.
Our senior attorneys have extensive experience with international business transactions in emerging and frontier markets, including the Middle East, Asia and Europe. Our focus is on creating growth opportunities for our clients while putting in place legal structures that incentivize all parties to make the transaction successful. Our approach is practical and our solutions are crafted according to each client’s business objective.
Should you wish to speak about your matter directly to an experienced attorney, please call us to schedule a complimentary consultation at +1 (206) 264-8999.