How to vet a counterparty in 5 minutes
A short, practical checklist for verifying a company before you sign a contract.
Before you sign a contract, take five minutes to confirm that the counterparty actually exists, is solvent and has no obvious red flags. This short guide walks through the essentials.
1. Confirm the legal entity
Search by name, tax ID or registry number. Check that the registration status is active and that the address and director match what the counterparty told you.
2. Review the financials
Look at the latest published statements: revenue trend, profit, total assets and liabilities. Sudden drops or persistent losses are worth a question.
3. Check owners and links
Look up the beneficial owners and management. Cross-check whether they are connected to other companies with problems.
4. Search litigation
A high number of court cases — especially as a defendant — usually signals payment or quality issues. Read a few case headers, not just the count.
5. Save the evidence
Export the company card or take a snapshot. If a dispute appears later, you will want to show what you knew at the moment of signing.
Doing this on every new counterparty takes minutes and prevents most predictable problems.