Envi­ron­men­tal Due Diligence Minimises & Limits Transaction Risks CLIENT SOLUTIONS OUR EXPERTS ABOUT US CAREERS SEARCH Contact Us Find Us News Europe (English) - English Toggle high contrast mode off © indus­trieblick, Fotolia HOME / CLIENT SOLUTIONS / TRANSACTION SERVICES INSIGHT Envi­ron­men­tal Due Diligence Minimises & Limits Transaction Risks BY CHRISTIANE JUNG | BUSINESS DEVELOPMENT MANAGER Anyone who nowadays buys a company or property will usually carefully verify financial, tax, market and competition as well as legal risks. Envi­ron­men­tal risks such as a cont­a­m­i­nated site or an unclear envi­ron­men­tal permitting situation also play an important role. The value of a transaction target depends not least on possible envi­ron­men­tal liability risks. An Envi­ron­men­tal Due Diligence is therefore advan­ta­geous for both buyers and sellers. Since 1985, the number of company trans­ac­tions has risen twentyfold. At the same time, the effort of nego­ti­a­tions before a transaction have also risen consid­er­ably. The process of inves­ti­gat­ing all facts, conditions, rules, laws, regulations, financial consid­er­a­tions, or any other such matters that would affect one's decision to purchase property is called due diligence assessment. Although an envi­ron­men­tal due diligence assessment (EDDA) is not legally required, anyone who acquires a company or a property from which envi­ron­men­tal risks arise can also be made liable for this. Strict compliance guidelines and the more deliberate handling of money and assets do their utmost to ensure that the EDDA is becoming more and more important. It is important to consider not only the actual situation but also to check whether the transaction corresponds to future laws and regulations. CHRISTIANE JUNG, BUSINESS DEVELOPMENT MANAGER As an increasing number of potential buyers evaluate the legal, fiscal and financial situation, the envi­ron­men­tal condition of the target is often neglected. This however becomes even more crucial, as the value of the target is signif­i­cantly dependent on its envi­ron­men­tal risks and the liability risks it is exposed to. It is therefore important to take a close look at possible envi­ron­men­tal risks and the resulting liability within the scope of the due diligence process. Legislative changes foreseeable at the time of the transaction are included in the evaluation. Possible envi­ron­men­tal risks or provisions for the elimination of envi­ron­men­tal damage can thus be directly integrated into the sales and purchase agreement and reflected in the purchase price. An EDDA is also relevant from the seller's perspective. For this reason, in addition to the buyer's due diligence (Buyer DD), a seller's due diligence (Seller DD) is also highly recom­mend­able. This serves to document the envi­ron­men­tal risks or damage at the time of the sale from the seller´s point of view. The Seller DD thus represents the ideal starting point for the sales nego­ti­a­tions of the Buyer DD. Inter­na­tional Standards CDM Smith audits use procedures that apply across the globe while taking into account local require­ments specific to a country or region. Our assessment criteria include the following standards in their current version: Envi­ron­men­tal Liability Directive (2004/35/EC) ASTM 1527: Standard Practice for Envi­ron­men­tal Site Assessment Process: Phase I Envi­ron­men­tal Site Assessment Process ASTM 1528: Standard Practice for Limited Envi­ron­men­tal Due Diligence: Transaction Screen Process ASTM 1903: Standard Practice for Envi­ron­men­tal Site Assessments: Phase II Envi­ron­men­tal Site Assessment Process ASTM E2107: Standard Practice for Envi­ron­men­tal Regulatory Compliance Audits ASTM E2365: Standard Guide for Envi­ron­men­tal Compliance Performance Assessment You can rely on CDM Smith as a competent partner through all EDD phases. Christiane Jung Business Development Manager Related Capa­bil­i­ties Remediation Envi­ron­men­tal Management Rede­vel­op­ment Data Centers and Construc­tion Management CDM Smith has expertise in the design of and performing due diligence for complex, program-driven high-technology facilities such as data centers, distri­b­u­tion centers, warehouses, and trans­porta­tion facilities. READ MORE ACCES­SI­BIL­ITY.OPEN_LINK_IN­_NEW_WIN­DOW_­TEXT Related Experts Previous Áine O'Shea Envi­ron­men­tal Scientist Rolf Luding Senior Project Manager Karsten Menschner Senior Consultant Next Related Projects and Insights Previous ENVIRONMENT INSIGHT Asbestos in Plasters, Tile Adhesives and Fillers ENVIRONMENT PROJECT Envi­ron­men­tal Due Diligence for Production Sites Japan INSIGHT Docu­men­ta­tion for IED Plants Next DATA CENTER DUE DILIGENCE AND CONSTRUC­TION MANAGEMENT CONTACT US Let's start the conver­sa­tion Thanks for visiting. We want to know you better, so send us a message. 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