In general, lawyers should consider engaging a virtual data room (VDR) provider whenever they need to share and control documents with an outside party while maintaining confidentiality and being able to track access to a given document. In particular, lawyers should consider using a Virtual Data Room provider when:
• Preparing documents for a transaction, especially where documents need to be put together from different sources and shared with different parties.
• Circulating information memoranda or teasers. A good virtual data room will make the process easier and will provide valuable tracking and audit information.
• Turning around drafts of legal agreements. A good dataroom offers a very simple, secure and easy-to-use document versioning system without the expense of complex dedicated document sharing platforms.
• Conducting due diligence, as a substitute for a paper or email-based data room.
• Closing a transaction, as a substitute for hard copy deal bibles.
Francisco Lorca is the Chief Executive Officer of EthosData, a global provider of Virtual Data Room services with offices in Asia, Europe and the US. EthosData has recently established joint ventures with Millnet and Vintage Filings. Francisco Lorca can be contacted at Francisco.Lorca@EthosData.com.
This article first appeared in the October 2009 issue of PLC Magazine.
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