Legal risk

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The risk that transactions or business relationships may have unforeseen adverse legal consequences.

For example, giving rise to additional costs or to the inability to enforce legal rights.


The risk that the administration of legal matters may be more costly - or otherwise more burdensome - than foreseen.

Legal risk may arise from existing laws and practice, or from changes in relevant laws and practice.

Legal risk may arise in relation to:

  • Employees
  • Suppliers
  • Customers
  • Third parties

See also