Jurisdiction(s):
United Kingdom

Key definition

Due diligence definition

What does Due diligence mean? In legal practice, due diligence describes (1) compliance steps to prevent offences; and (2) pre‑transaction investigation in corporate and finance work. As a statutory defence to many strict‑liability and regulatory offences (for example under the UK Consumer Protection from Unfair Trading Regulations 2008 and the Food Safety Act 1990, and under Ireland’s Consumer Protection Act 2007 and food legislation), it requires the defendant to show that all reasonable precautions were taken and all due diligence was exercised to avoid the commission of the offence. Depending on the statute, this may place a legal or evidential burden on the defendant,...

Environmental due diligence for corporate acquisitions and disposals: instructing consultants, scope and standards, timing, reporting and reliance, and risk allocation for purchasers and vendors

Published by a LexisNexis Environment expert

Practice notes

Buyers and sellers weigh numerous factors when conducting thorough Due diligence during a commercial transaction for the purchase or disposal of a business together with its operational sites and plant. Environmental considerations ought to form a key part of any Diligence process for the enterprise. 'Caveat emptor'—'let the buyer beware'—is a well-established common law doctrine under which the seller has no legal obligation to reveal material facts to a potential purchaser, so the purchaser must make their own enquiries. Environmental regulations can drive substantial capital spending, and such risks may materially change a company’s overall risk profile. Compliance shortcomings may seriously damage reputation, while Enforcement could threaten the long term viability or profitability of the business.

Commissioning an environmental consultant

Provide your environmental consultant with full and relevant context for the proposed deal when commissioning due diligence, so an appropriate and proportionate appraisal of potential liabilities can be made from inception.

The following should be considered:

What is the proposed transaction type—sale, asset-only purchase, management buyout, or similar?

These scenarios influence the scope of work your consultant will carry out in practice, and the depth of analysis required. The reporting format for vendor due diligence will vary significantly from...

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Web page updated on 21/05/2026

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