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Owner & Family Managed Business Solicitors

What are Owner & Family Managed Businesses?

An owner-managed business is generally defined as an enterprise where the owner or owners are directly involved in the daily operations and management of the business and have full control over the commercial decisions that are made.

In some cases, but not all, an owner managed business can also be a family-run business.

A family business in the UK is generally defined as a firm where the family goals are legitimised in business, so in some instances it may be just the one core business stream, but in others there may be a range of different activities falling under the family business umbrella.

Both of these types of business can have different legal considerations from other non- owner-managed or family businesses and obtaining advice from solicitors with experience in family business law is important.

Our solicitors for owner-managed and family businesses have a long track record of advising independent businesses across East Anglia and will be happy to discuss how we can help you.  Contact us using the form below or email the head of our commercial team on jennyball@fraserdawbarns.com.

Legal services for Family Businesses

There are many examples of very successful family businesses in the UK and it is a very popular business structure in East Anglia. Family run businesses span a wide range of sectors including agriculture and rural enterprise, tourism and leisure, hospitality, property and development, and transport businesses. These organisations can vary considerably in size and so, therefore, does what they need from their family business lawyers.

It is crucial that family businesses operate within a legal framework that protects all parties’ interests. The fact that there is generally an emotional connection between those involved in the family business can be a major strength, but it can also make it harder to resolve any issues that arise.

Our family business lawyers can help you to navigate through the key milestones in your family business. These may include some or all of the following.

  • Shareholder agreements and articles of association - making sure that you have the right framework for your family business and that all stakeholders have their interests protected from the start.
  • Business growth and restructuring – our family business lawyers can advise on the legal aspects of protecting an expanding family business. If you have an existing family partnership, this might include helping you to make the transition from a family partnership to a corporate structure. Our family business solicitors can also assist if you decide to expand your business through acquisition.
  • Managing family business disputes – disputes are relatively common in family-run businesses, and our specialist family business solicitors are on hand to help you resolve issues and move your business forward positively. We understand that there are often more than just legal issues driving disputes of this nature and take our time to get to the bottom of what is driving the dispute. This is turn leads to better outcomes for clients that are in line with your specific objectives. Full details of dispute resolution options can be found on our commercial disputes page but may include mediation or other forms of alternative dispute resolution.
  • Succession planning and generational transitions – many of our family business clients have the ultimate goal of passing on a thriving business to the next generation. Our family business solicitors can advise on ways of transferring ownership of the business to one or more of their children. Our corporate and commercial family solicitors will work with you, and our private wealth solicitors where appropriate, to ensure that the assets are transferred in the most tax-efficient way possible.
  • Legal services for Owner-Managed Businesses
  • Almost all owner-managers of businesses face similar challenges, although potentially on different scales depending on the nature of their business. The over-arching issue is that they are trying, at least at the outset, to work in the business as well as on the business.
  • Allowing our owner-managed business solicitors to help ensure that the legal aspects of the business run smoothly will give you as the owner-manager more time to focus on growing your business and its profitability. The ways in which our lawyers may be able to assist include the following.
  • Corporate governance and director duties – our lawyers will be able to explain your legal responsibilities, compliance requirements and outline best practice for directors.
  • Taking on new employees or employing family members – employing people in your business comes with responsibilities and a raft of continually changing employment legislation. Our employment lawyers for employers will be able to help you put in place any employment contracts that are needed and also help with other aspects of employment law depending on the nature of your business. We can also assist you with directors’ service agreements.
  • Protecting business assets and intellectual property rights – depending on the nature of your business, this might be important to you. We will help you to ensure that you get the appropriate advice to protect assets and intellectual property.
  • Exit strategies and business sales – at some stage you may wish to consider your options for selling your business or passing it on to a family member. Our corporate and commercial solicitors can help you with both the planning and the practicalities of this, working with our private wealth lawyers to ensure that everything is done as tax-efficiently as possible. Whether you are considering family succession planning, and MBO, an EOT or an external sale, our solicitors can support you, making the process as stress-free as possible.

If you are ready to have a chat about how we might be able to help you and your family or owner-managed business, please complete the contact form below or get in touch with the head of our commercial team on jennyball@fraserdawbarns.com.

Frequently asked questions about owner & family managed businesses

An owner-managed business is one where the owners have full control over the management and strategy of the business.  The owners may also be family members, but they may not.  A family business may cover one or more types of commerce or activity, and not all of the members may have day-to-day control over the business’ strategy or management.
Yes, if your family business is a company, you should have a shareholder agreement. If your family business is a partnership, then you should have a partnership agreement. Both are legally enforceable contracts.  A shareholder agreement will regulate the relationship between shareholders, detailing their rights and obligations. It will help to avoid, or resolve, disputes and provide clarity on ownership and decision making.
Every family business is different but there are a number of general considerations which are a good starting point.  These will include: Do we already know who we want to take over? Is it one or more people who are already involved in the business? Are we intending to bring in external people from outside the family business? Once you have got the answers to those questions you can then start to think about the timing and approach to succession, and also the tax and other financial implications. Our family business solicitors can help guide you through this process and undertake any of the legal paperwork that is required.
The key will be working out whether the disagreement between family members can be resolved or not.  One aspect of shareholder dispute resolution, or partnership dispute resolution, will be going back to the original documentation and seeing what was set out in the shareholder agreement or partnership agreement and/or articles of association. Involving a third party to help generate a strategy on which you can potentially agree to keep the family business on track for future success may be helpful.  However, if this is not successful then other forms of dispute resolution may be needed.  If a dispute cannot be resolved, then there are various possible steps to take so that one or more family members can take the family run business forward and another or others to leave the business.  These could include: Valuing the business assets and working out how to distribute them, Settling any outstanding debts and obligations, Ensuring that any intellectual property is appropriately assigned or sold, Making sure that all employees are treated appropriately if the business downsizes or is sold, Making sure that the tax implications are considered fully, Ensuring that any required regulatory steps are followed.
In many cases, the answer is yes. Depending on the nature of your business, you may need to consider some or all of the following: Business Property Relief (BPR), Agricultural Property Relief (APR), Capital Gains Tax (CGT), Trusts, Family Investment Companies (FICs).
An MBO enables the management team of a company to buy a business from its existing owners. The managers become the new owners of the business and have all the financial and operational responsibilities that go with this. The most common reasons for an MBO are: When a business wishes to sell non-core assets, As a form of succession planning, When a management team believes it can continue to grow the business more successfully and profitably than external buyers. The most common scenario for an MBO within an owner or family managed business is when the existing owners are looking for an exit or retirement strategy and other members of the family are not interested in continuing with the family business.
There are various ways in which you can protect minority shareholders in an owner managed or family run business.  These include: Ensuring that your shareholder agreements are comprehensive and define the rights, decision processes and transfer restrictions in a way that protects minority interests, Make sure there are minority buyout options, Build in voting rights protections in a way that ensures you have minority influence in governance, Promote trust and inclusivity so that any business disputes can be resolved amicably in a way that protects the interests of minority shareholders.
Yes.  It is important for everyone who works within a family or owner managed business to have the same level of protection through employment contracts as non-family employees. Our family business solicitors are here to help and can be contacted via any of our offices in King’s Lynn, Downham Market, Ely, March or Wisbech.
An EOT holds some or all of a company’s shares on behalf of its employees.  These were set up to encourage shareholders in a owner-managed business to sell their shares into a trust for the benefit of employees. The aim is promote employee engagement and the long-term sustainability of the business. To find out more about how they work and whether one might be right for your owner managed business, contact our family business law solicitors.