Security Legal Risks and Preventive Measures

Experts predict that in 2010 China's security output will reach 200 billion yuan. The good prospects for development have encouraged many people in the industry and they all want to share one more piece in this huge market "cake." Although the prospects for the development of the industry are very attractive, for the security companies, the legal risks are gradually increasing. For their long-term and steady development, the security companies must have the awareness of legal risk prevention.

Corporate legal risk causes and performance:

How to prevent legal risks? In simple terms, legal risk is based on legal regulations that may affect business costs and profits of business operations. It is mainly divided into two kinds of situations: The first is the risk arising from the law itself, including the impact of law formulation and abolition on the company. For example, the increase in urban land use tax will certainly affect the operation of real estate companies. This is the risk arising from the legal provisions themselves. There is no way for enterprises to resist such risks. The second is the risk that the company's business conduct violates laws and regulations. For example, due to the low level of legal attention of certain companies, the operation is opportunistic. Replicating well-known brands violates the law and is sanctioned by the law.

The legal risks of business operations are mainly reflected in the following six aspects:

Legal risk in the establishment and operation of an enterprise During the process of setting up an enterprise, whether the sponsor of the enterprise has conducted full legal design of the enterprise to be established, whether it has sufficient knowledge and plans for the establishment process of the enterprise, and whether it has completely fulfilled the establishment of the enterprise. Obligations, and whether the sponsors themselves have corresponding legal qualifications, are directly related to whether the proposed establishment can have a legal and standardized establishment process. It can be said that the establishment of a professional legal program design and specification is half of the company's success. If there is a legal flaw at the beginning of the establishment of a company, it will inevitably create hidden dangers for the company's future operations. Although this kind of legal tactics does not necessarily lead to a legal crisis in the short term, as long as it is not eliminated, it will exist as a legal risk for a long time; once it occurs, it may be a fatal blow. For example, whether the company's ownership structure is reasonable, corporate governance structure is complete, the supervision and control mechanism is sound, and the power between senior management personnel checks and balances, etc. If these problems are not resolved during the operation of the company, it is very likely that “there will be a disaster”. Internal disputes and tactics will directly affect the healthy development of enterprises.

The legal risk contract in the process of contract conclusion and performance is the most common basic legal form adopted by various types of enterprises when engaging in business activities. It can be said that the contract runs through the entire process of business operations. As long as there are business activities, contracts must be created. When signing the contract, the party considers that it is the contract interest rather than the contract risk. While avoiding the uncertainty of the transaction behavior, the contract may also impose legal risks for the parties due to the contractual deficiencies. All security companies are benefiting from continuous transactions with various types of entities. The wide application of contracts in business operations determines that the legal risks in the conclusion and performance of contracts are extensive. In recent years, as people’s legal awareness has grown, many companies have attached importance to the conclusion of contracts. During the offer and commitment process, lawyers are invited to participate and lawyers are required to draft contract texts. According to the author's knowledge, Hebei Security Co., Ltd. is basically improving every year in the contract text.

However, for many business contracts, signing the contract text is only a good start. The fulfillment of the contract is really important. In the process of contract implementation, both parties' correspondence, memorandum, minutes of the talks, fax and electronic data are valuable evidences, and attention should be paid to ordering and preservation. Relative to the legal risk of the contract text, the types of legal risk of contract execution are more and wider, and the management and prevention are more difficult.

Legal risk of corporate mergers and acquisitions Globally, corporate mergers and acquisitions have gradually become a mainstream form of modern investment. The legal risks of corporate mergers and acquisitions are mainly reflected in corporate mergers and acquisitions. Mergers and acquisitions involve corporate laws, anti-unfair competition laws, tax laws, intellectual property laws, and other laws and regulations. The merger process is complex and has a large impact on society, and the potential legal risks are high.

Intellectual Property Legal Risks Intellectual property rights include trademarks, patents, and copyrights, which are the fruits of the crystallization of creativity and wisdom. The object is a special property in non-material form and requires special provisions in relevant laws. In the field of intellectual property rights, protection and infringement are twin brothers, and security companies are negligent. Their intellectual property rights are easily infringed by others, or they infringe others’ intellectual property rights. Whether they are infringement or infringement, they will face Huge legal risk. "Crypto CCTV", "Spring Festival Gala" and other cybersquatters are excellent examples. If you look for reasons from the company itself, the lack of awareness of risk prevention at the decision-making level and at the consultant’s lawyer may be one of the most important factors.

Legal Risks of Human Resources Management In China, the laws and regulations related to human resources are mainly the "Labor Law", "Labor Contract Law" and related administrative regulations and departmental regulations. In all aspects of the enterprise human resources management process, from the beginning of recruitment, interviewing, hiring, signing of labor contracts, employee treatment issues until the departure of employees, there are relevant labor laws and regulations to adjust and standardize, any non-compliance of the company All may bring about labor disputes to the company and cause adverse effects.

On the other hand, for the sake of long-term development, enterprises often spend a lot of money to train their business backbones and technical backbones. These key employees hold a large number of corporate secrets such as customer data, trade secrets, and technical secrets. As companies grow and grow, the expectations of key staff will rise. Once companies fail to meet individual demands, they will threaten to quit. The high job-hopping rate of employees and the low degree of loyalty to companies are currently the most prominent personnel issues that plague many security companies. Job-hopping employees will often take away valuable customer resources, trade secrets, and technical secrets of the company. The flow of these employees will generally not deviate from the industry they were engaged in, or choose to start their own business, or choose other companies in the same industry. Become a new company's competitors and gradually erode the company's resources and markets. The job-hopping of key employees will often cause incalculable economic losses to the company, sometimes even fatal blows.

Legal Risks of Corporate Finance and Taxes In recent years, there have been a large number of financial and tax-related cases involving security companies. From a certain perspective, it can be seen that corporate legal risks in financial taxation are increasing. Under the current fiscal and taxation policy environment in our country, it is difficult to distinguish clearly between reasonable tax avoidance and tax evasion. If it is handled improperly, the company is likely to suffer unnecessary economic losses and even bear corresponding criminal liabilities. It may also be a legal representative. Injury in prison.

Characteristics of the Security Industry and Security Management Laws and Regulations The characteristics of the security industry mainly manifest itself in the following: The purpose of security system construction and the function of security products are to protect the safety of life and property. Its social benefits are enormous, and its value cannot be compared with other technical systems.

First, the places where security systems and products are applied are intensively wealthy, and their security status has great influence on social stability and citizens' sense of security.

Second, security system construction and operation management have a close relationship with public security business work. In addition to some critical parts and major activities of the security system directly managed by the public security department, the social security system is also closely linked with the public security business, and its system planning program must accept the guidance of the public security department, drawing on the experience of the public security work; Many of the information collected by the security system is of great value to the public security business.

Third, the security system is the object of prevention, and people have anti-detection, anti-monitoring capabilities, and can launch attacks and destruction of systems and equipment. In the face of the challenges of high-tech crimes, a perfect security system must have an effective response capability, which is closely related to system management and personnel management. Therefore, the security system cannot be a fully automated system. The combination of technology prevention and civil defense and physical defense, and the combination of technology and management is a very distinctive and different security system.

In China, with the needs of the security industry management, a number of laws and regulations have been introduced one after another, initially forming a multi-level regulatory system. This system consists of industry regulations, local regulations, mandatory standards, and certification work. It plays a significant role in the operation and management of the company.

Industry regulations to maintain public safety, standardize safety technology and prevent management, and fundamentally solve outstanding problems in the industry management and information use. In 2008, under the leadership of the Legal Affairs Office of the State Council and the Legal Affairs Bureau of the Ministry of Public Security, the Science and Technology Bureau of the Ministry of Public Security organized relevant experts to strengthen research and drafting of security legislation and completed the Regulations on the Prevention and Administration of Security Technology (revised draft). The guiding ideology, target principles and scope of application of the legislation, as well as the requirements for employment, installation and operation, information use, supervision and inspection, and legal responsibilities. At present, the revised draft has solicited opinions from the industry, including the Ministry of Housing and Urban-Rural Development, the Ministry of Industry and Information Technology, the General Administration of Quality Supervision, Inspection and Quarantine, and the State Administration for Industry and Commerce. After the revision, if it can be successfully introduced, it will make Security management is fundamentally integrated into the legal system, and the security industry has also ushered in a good situation of further prosperity and standardized development.

The "Regulations on the Management of Security Services" promulgated by the State Council also refers to the regulations governing the use of security equipment. These provide the legal basis for the technical protection management conducted by the public security department. We can see from this that people are more vigilant against the possible infringement of individual rights of citizens brought about by the technical defense system, and this has increased the protection of citizens’ privacy in the regulations.

In addition, Article 51 of the "People's Republic of China Employment Promotion Law," passed on August 30, 2007, stipulates: "The State shall implement an occupational certification system for workers engaged in special types of work involving public security, personal health, and life and property safety. This regulation provides a legal basis for implementing the access system for security industry practitioners, thus ensuring the healthy development of the security industry.

Since 2007, local laws and regulations, in order to maintain public safety, regulate the management of public safety image information, safety technology prevention products, and the construction of security facilities systems, and improve the ability to prevent and dispose of public emergencies. Each province and city combines local needs and actual conditions. Successively formulated and promulgated a series of management regulations. Beijing Municipality has promulgated the "Measures for the Administration of Public Security Image Information System in Beijing Municipality"; Chongqing Municipality has promulgated the "Administrative Measures for Chongqing Public Social Security Video Image Information System"; Liaoning Province has promulgated the "Measures for the Administration of Public Safety Video Image Information System" and so on; The Sichuan Provincial People's Congress adopted the "Public Security Technology Prevention and Management Regulations of Sichuan Province" and it has been implemented since January 1, 2010.

Standardization work In recent years, China's standardization work has made considerable progress. As of the end of August 2008, the National Security Alert System Standardization Technical Committee (SAC/TC100) has completed a total of 100 current national and industry standards. These standards cover a wide range of professional technologies, including intrusion and anti-robbery alarms, video surveillance, entrance and exit control, physical protection, explosion-proof security inspection, and security engineering.

Certification Work In 2008, the security certification business made positive progress in basic work, management work, and innovation. These laws and regulations provide a basic legal framework for the development of the security industry. However, the only drawback is that the legislation at the national level has not been introduced. The security industry policy lacks clarity and the security supervision system is still incomplete. These factors have led to self-regulation in the security industry. It is particularly important.

Security companies how to prevent legal risks First, strengthen risk awareness. Security policy makers must realize that once legal risks occur, they can bring serious consequences to the company, but many risks can be prevented and controlled in advance.

In fact, we must improve the management system. The establishment and improvement of a legal risk prevention mechanism must be organically combined with accelerating the establishment of a modern enterprise system and improving the corporate governance structure, so that the prevention of legal risks becomes an important part of the internal control system of an enterprise.

Third, it is necessary to speed up the construction of a management system based on a corporate legal advisor system. There is a big gap between China’s corporate legal consultancy system and European and American countries. Although there are more than 100,000 corporate legal consultants in the country, most companies do not pay enough attention to legal consultants. A survey on the website of the security industry shows what is the most common method used when a company encounters legal disputes. The most common answer is “this situation has not yet been encountered”, and the least is that “companies have full-time legal advisers. To solve these problems, through the results of the above questionnaires, the legal risk prevention of security companies is still lacking awareness of legal risks, and there is a lack of understanding of the importance of legal advisors.

Fourth, it must highlight contract management and intellectual property management. Strengthening contract management is a basic work to prevent corporate legal risks. It is necessary to establish a contract management system that focuses on pre-emptive and incident-based control and supplemented by post-event remediation. The most common and basic work of the author in the process of being a legal consultant for security companies is to review the company's various contracts and to reduce and avoid legal disputes and legal risks by reviewing the contracts. Security companies must fully consider the rights and obligations of both parties in the preparation of the contract, and should not make unrealistic statements and promises, nor can they use unreasonable terms that exclude the rights of the other party, so as to ensure the smooth performance of both sides and establish the credibility of the company. Foster customer loyalty.

At the same time, the management of intellectual property rights is also very important. As an emerging industry with a history of 30 years, the infringements in the security industry, such as the price of roasted seeds and nuts and counterfeiting, are still very common. Most companies’ awareness of intellectual property rights is still relatively weak, and the phenomenon of infringement is particularly serious. It has become a major obstacle to the development of the industry. . Protecting intellectual property rights is an urgent task for enterprises. On the one hand, security companies should increase the protection of their products while doing a good job in intellectual property rights applications; on the other hand, it should be clear that security claims and manuals are very important. Some highly technical patent products are difficult to win after infringement, because it is difficult to determine whether the “indicted infringing product is the same or equivalent to the necessary technical features of the patent involved in the case and whether it falls into the protection scope of the patent involved”.