Jurisdiction(s):
United Kingdom

Key definition

Asset definition

What does Asset mean? In legal practice, an asset is any thing of economic value that a person or entity owns or controls and can realise, transfer, secure or enforce. The term is descriptive and used across contexts (company law, trusts, matrimonial finance, probate, enforcement and insolvency), with specific legislation or rules defining it for particular purposes (for example, insolvency, taxation and financial services). Assets include land and buildings, cash and bank balances, securities (shares, bonds and other fixed‑income instruments), receivables, contractual rights (choses in action), intellectual property, goodwill and, increasingly, cryptoassets. Assets may comprise legal or equitable interests and can be tangible or...

Environmental indemnities in asset purchases: due diligence triggers, drafting checklist (scope, triggers, caps, time limits, claims control, limitations), negotiation pointers and insurance options for EHS liabilities

Published by a LexisNexis Environment expert

Practice notes

When is an indemnity needed?

Where issues are revealed during the due diligence phase, such as Contaminated land liabilities or specific environment, health and safety (EHS) non-compliance, the purchaser may seek an environmental indemnity to be included in the Asset purchase agreement (APA) or secured in a stand-alone environmental deed.

Refer to the following Precedents:

Environmental indemnity for an asset purchase agreement
Asbestos indemnity for when seller is in breach

Checklist for environmental indemnity

Once the principle of an environmental indemnity is accepted, lawyers and their clients should agree the scope before any drafting commences. Indemnities are tailored to the specific Transaction. The list below highlights the key issues that ought to be considered.

Indemnifying parties: The purchaser may want the seller’s parent company added as guarantor.
Liability cap: Often set with advice from technical consultants. Note that clean-up liabilities could exceed the purchase price, particularly where there is groundwater pollution or off-site migration.
Time limit: The seller will want an end point to contractual exposure. Sellers typically offer a short period, say 2–3 years, or to the end of the lease if this is shorter...

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Web page updated on 21/05/2026

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