Out-Law Analysis | 25 Apr 2018 | 11:12 am | 2 min. read
The need for greater collaboration, innovation and the sharing of ideas and methodologies which promote efficiency and improve safety has been a consistent requirement of the major operating companies, contractors and industry policymakers alike, and we are now on the threshold of seeing this bear fruit.
The Oil & Gas Technology Centre in Aberdeen has been at the forefront of this push for greater cohesion across the industry, and its TechX Pioneer programme will encourage an exciting new wave of start-ups. Pinsent Masons, the law firm behind Out-Law.com, has been appointed legal mentor to the companies enrolled in the programme, providing them with advice on company structures, directors' responsibilities, contract law, intellectual property and legal updates relevant to young technology startup enterprises.
TechX will invest in more than 100 new startups and 200 small and medium-sized enterprises (SMEs) over the next 10 years, to help unlock the full potential of the North Sea and anchor a new technology supply chain in the north-east. Entrepreneurs and innovators will be offered support and end-user access to reduce the time and cost of market entry for challenger technologies.
For any startup business, regardless of sector, putting the correct company structure in place from the outset can make the difference between being the next IPO success story or just another what-might-have-been. At Pinsent Masons, we often have to unravel ownership structures which have restricted the growth of a business because the initial shareholders have become misaligned, or the direction or requirements of the business has outgrown the contribution original shareholders are able to make.
Conflicts can also emerge around intellectual property. Most potential investors are seeking a combination of the right people aligned to smart protected technology, but unless IP rights are protected from the start investors may be put off from providing vital support which will take the company to the next stage of development - or, at the very least, the company will suffer value leakage which undermines a fundraising round or sale proposition.
We will also help to guide the startups on directors' responsibilities, and the need to be aware that transitioning from the excitement of a startup enterprise into a fully-fledged business brings with it an extra layer of legal and fiduciary duties. The shareholders and directors are often one and the same in the startup community, and they have to be mindful of which 'hat' they are wearing at particular points to avoid potential conflicts of interest, remembering that the future best interests of the company may differ from the views of some of the current shareholders.
The technologies developed in the North Sea over the last 50 years have underpinned a vast range of exploration and production techniques now deployed across the oil and gas producing world. To ensure maximum economic recovery and efficiencies in the UK Continental Shelf over the next 50 years, we are duty bound to encourage this new generation of innovators that are coming through and to help them turn their visions into reality by making the growth process as pain-free as possible.
Martin Ewan is an oil and gas technology law expert at Pinsent Masons, the law firm behind Out-Law.com.