How can a FPO attract investment or attract partners to its…?

The law does not provide ready-made solutions for investing in FOP, therefore, practices for concluding mixed loan agreements, joint activities, provision of services, etc. are usually used.

A loan agreement

By providing financial resources in the form of a loan, the investor can expect to receive profit in the form of interest. This model turns out to be profitable, since the customer undertakes to repay the loan even in case of project failure. At the same time, if the project is successful, the investor does not have the opportunity to increase his profit, because he is limited by the amount of interest income. This investment option is appropriate if the customer is a FOP. However, if there is a need for the investor to secure his share in the business properly (with the possibility of increasing profits in case of business growth), then it is necessary to register a legal entity. individual, LLC or JSC.

Agreement on joint activities

This refers to the specification of the types of contractual relations defined by the Civil Code (Articles 1130 - 1143), and do not require registration of a legal entity.

Individuals and legal entities, as well as sole proprietorships, have the opportunity to enter into agreements. They can jointly engage in activities, using the method of pooling contributions (simple partnership) or without it. It is important to note that this approach is beneficial for the implementation of individual projects. For example, the customer can provide qualified personnel and technology by taking over the administration, while the investor can provide financing and use his business reputation to promote the project in the market.