A legal entity is the legal name of a separate organization/company that has legal standing in the eyes of the law. Given that we operate in so many countries around the world, individual entities are set up to establish ownership of the business we conduct in that area. That way, we can operate as efficiently as possible with the legal capacity to enter agreements and contracts, assume obligations, etc. We are now taking on a comprehensive effort to change the names of certain legal entities, where necessary, in a way that does not interrupt your business.
General Legal Entity
Why are the Legal Entities changing?
As part of the merger transaction, Dow and DuPont are working to internally restructure their businesses in preparation for the formation of the three DowDuPont divisions – Agriculture, Material Science and Specialty Products – and in preparation for the intended transition into independent companies.
Legal entities in countries where needed, have been formed in order to realign heritage Dow (including legacy Dow Corning) and heritage DuPont businesses to one of the three DowDuPont divisions. There will also be assets transferred between existing entities, where needed, to align those assets to the right division.
Why are you making this change now instead of just waiting until you are a separate company?
This change is necessary as we begin the process of separating the Specialty Products Division from the other Dow and DuPont legal entities.
Will you be making other legal entity name changes in the future, and when?
Apart from legal entity changes that are being communicated for Specialty Products Division, no further name changes are anticipated until after June 1, 2019. In the event there are changes, we will provide advance notification to allow you to prepare for those changes.
When do the DuPont legal entity changes take effect by country?
- October 2018: Austria, Bulgaria, Greece, Ireland, Nigeria, Pakistan, Russia, Serbia, South Africa, Turkey, Ukraine, UAE, Canada
- November 2018: Belgium, Czech Republic, Denmark, Finland, France, Germany, Hungary, Italy, Luxembourg, Netherlands, Norway, Poland, Portugal, Romania, Spain, Sweden, Switzerland, UK
- January 2019: Argentina, Bolivia, Brazil, Chile, Colombia, Costa Rica, Ecuador, Guatemala, Mexico, Paraguay, Peru, Uruguay, Venezuela, US (excluding Legal Entity Code 2350 and MCM)
- February 2019: USA – DuPont Parent Company (Legal Entity Code 2350)
- April 2019: Australia, Cambodia, China, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, Myanmar, New Zealand, Philippines, Singapore, Taiwan, Thailand, Vietnam, all MCM (excluding MCM in 2350)
How do I know which legal entities pertain to me?
The customer communication provided ~45-60 days prior to the effective date will contain the current and corresponding future sales or site legal entity name for the applicable country or region.
When will I receive additional information?
You will receive additional information ~45-60 days before the effective date for each region to notify you of the specific changes and that everything is on schedule.
What else will change as a result of the changes to the legal entities?
There will be minimal change in other areas of our business as a result of these legal entities changes.
Who are my primary points of contact for the customers for the change?
The customer’s local key account manager is their primary source of information for upcoming changes. This will be communicated in close contact and alignment with the appropriate customer service rep.
What does stand-up or go-live mean?
Stand-up or go-live refers to the process a company takes to align business resources (assets, liabilities, costs, revenue streams, employees, etc.) in readiness for a separation from the heritage company. Standing up a business, or set of businesses, may require realigning business resources to separate legal entities and dividing Enterprise Resource Planning (ERP) systems into tenant environments that can be handed over to the future company.
What does it mean to be a “shared customer”?
Shared customers are those who purchase or will purchase products from both the Materials Science Division (future Dow) and the Specialty Products Division (future DuPont). Shared customers who are part of the Legal Entity changes in November 2018 will likely receive duplicate communications from Dow and DuPont.
Why is Dow using old legal entities, i.e. those related to Rohm & Haas?
As part of the merger transaction, Dow and DuPont are working to internally restructure their businesses in preparation for the formation of the three DowDuPont divisions – Agriculture, Material Science and Specialty Products – and in preparation for the intended transition into three independent companies.
Legal entities in countries where needed, have been formed in order to realign heritage Dow and heritage DuPont businesses to one of the three DowDuPont divisions. In some instances, existing Dow legal entities will be leveraged for the heritage Dow businesses moving to the Specialty Products Division. In some countries, this may include the use of an existing legal entity. For example, a Rohm and Haas legal entity which were acquired as part of the Dow acquisition of Rohm and Haas Company in April 2009. There will also be assets transferred between existing entities, where needed, to align those assets to the right division. This change is necessary as we begin the process of separating the Specialty Products Division from the other Dow and DuPont legal entities.
Ordering & Shipping Changes
Will the phased restructuring impact order and documentation for customers who purchase products across geographies during the transition time?
- The change in legal entity is related to the geography in which that legal entity is based and not the geography in which the customer is located.
- For example, a customer in Latin American where the legal entity changes are due to take place in February 2019 may see a change to documentation if, for purchasing reasons, that customer is billed from a legal entity in one of the geographies that will change in November 2018, such as North America.
- Customers billed from a legal entity in the United State and Europe will fall into the first phase of our two-phased implementation, which begins in November.
- These orders will be captured within the newly integrated ordering system, and commercial/ordering documents such as invoices and order acknowledgements will include the new legal entity names.
I receive products from several regions. Because the legal entity changes will occur region by region, how will I be impacted?
During the transition, you may see different logos and information on some documentation. If you need to explain these differences to your audiences, we can provide a letter that explains this discrepancy in documentation (see Shipment Bridge Letter).
When will the logo change from Dow to DuPont?
The Dow Diamond will begin to be removed from documents at time of tower realignment, March 2019. If you need to explain these differences to your audiences, we can provide a letter that explains this discrepancy in documentation (see Shipment Bridge Letter).
Does this mean that the locations of the manufacturing sites are also changing?
Unless otherwise notified, manufacturing site locations will not change. To the extent there is a change, customers will receive advance notification to ensure a smooth transition and time to requalify product, as needed.
How will open customer orders be affected by this change (e.g. orders opened prior to the effective date that will be delivered after this date)?
Open orders may be impacted if there was a legal entity change. The customer may need to adjust the vendor on the order and resubmit. This is a customer decision based on the flexibility of their system. In those cases, you may see different logos and information on some documentation. If you need to explain these differences to your audiences, we can provide a letter that explains this discrepancy in documentation (see Shipment Bridge Letter).
Will all materials continue to be manufactured in the same facilities?
Yes. At this time, all of our products will be manufactured in the same facilities and our processes are not changing. You should expect the same products you receive today from the same locations.
Will the product manufacturing processes change?
No. At this time, all of our products will be manufactured in the same facilities, using the same processes, raw materials, quality systems, and lot numbers. You should expect the same products you receive today from the same locations.
If I have product that shipped and invoiced before the effective date, but payment is not due until afterwards, who is the check made payable to?
Please remit payment based on the instructions on the invoice.
How will my agreement and discount change for total volume?
Commitments that have been made will be honored. Any future change will be communicated in advance, and implemented with new commercial agreements.
Will there be changes to my customer service or local sales contacts?
If changes occur with your current sales representative or customer service contact, you will be notified in advance and provided the contact information.
What happens to my credit limit change?
Any change to a credit limit would be a function of our standard business review practices and a customer’s payment history.
Will there be a shipping holiday or a blackout associated with this legal entity change?
Yes. As the ERP platform is migrated and stood up, there will be a temporary halt in shipping. Online ordering and ordering via your CSR will be available for Future Dow materials. Ordering will not be available for Future DuPont materials. Future DuPont materials will not be shipped during this time period. Future Dow customers should expect slightly longer lead times during this period, as warehouses will be impacted.
Ordering and Shipping Freeze period: Wednesday, October 31, 2018, at 5:00 pm EDT (start date) until Monday, November 5, 2018, at 2:00 am EST (end date).
We are taking every action possible to avoid disruptions to Future Dow customers.
Why can’t I buy all of these products from you?
Based on the comprehensive portfolio review conducted by the Dow and DuPont boards in 2017, some of the silicones portfolio will be aligned to the intended Materials Science Division (future Dow) and some will be aligned to the Specialty Products Division (future DuPont). By aligning businesses with the end markets they serve, we will be well positioned to better anticipate and meet customer needs. We realize this means that some customers may purchase silicone products from one company today, but in the future they may purchase the same products from two independent companies. We are working to make this transition as smooth as possible.
Document & System Changes
What are the addresses for the new legal entities?
The final addresses of the new stand-up legal entities are being finalized at this time. They will be thoroughly reviewed and made available to customers along with business-critical tax and financial information (Tax ID numbers, VAT, etc.) in subsequent customer communications.
Are you changing your documentation to reflect these legal entity name changes?
Yes. We are in the early stages of planning to update our systems, customer-facing documents and packaging to align with the new legal entity structure. Once available, we will be able to provide examples of the documentation.
Can I get copies of the documentation that will change?
Yes. We are in the process of updating our systems and will be able to share examples of the following documentation:
- MSDS (Safety Data Sheet)
- Product Label
- Certificate of Analysis
- Order Acknowledgement
- Bill of Lading
Will there be a change in the VAT registrations?
The VAT number is likely to change, customers will be informed as soon as those become available.
Will there be a change in the TAX number?
The TAX number is likely to change, customers will be informed as soon as those become available.
Will there be an update in the customs registration number/EORI-number?
These numbers are likely to change, customers will be informed as soon as those become available.
Will there be a change in the bank account numbers?
The bank account numbers are likely to change, customers will be informed as soon as those become available.
Will contracts be updated/changed?
Yes, contracts will move from a Dow-aligned legal entity to a Specialty Products Division-aligned legal entity at the appropriate effective dates.
Will there be updates to W-8/W-9 form?
Yes. The W-8/W-9 form will be updated once the legal entity name changes are in place at the effective date, customers will be informed as soon as those become available.
Will there be an update to DUNS/TIN-number?
Yes. The DUNS/TIN-number is likely to change, customers will be informed as soon as those become available.
Will there be any change in payment terms?
Yes. The payment term may change once the ownership is transferred to DuPont and as contracts allows.
Should customer P.O.’s be updated?
For customers, it will be their decision if a PO needs to be updated. If there is a new PO, the customer should call their customer service representative to update the PO on the order.
Will there be any effect to credit notes?
There should not be any impact to credit notes, but please reach out to your local contact for verification.
Are vendor codes I have assigned changing?
It depends on how you assign vendor codes at your company. If the vendor code you have designated for is based on a location, it will not change as no changes are expected to our locations at this time. If they are decided based on another factor, please let us know and we will work with you to determine if changes are needed.
On June 1, 2019, will customers still need to continue to issue separate P.O.s and receive separate invoices?
There are operational streamlining opportunities that will arise as we become a stand-alone company. More information to come on scope/timing as our transformation continues.
Are there any changes associated with ordering processes?
Yes, the IT environments for both the Dow and DuPont businesses aligned to the Specialty Products Division are targeting a move as a Lift & Transfer effort later this year (2018). We will communicate any potential customer impact in advance, but at this point, we are not expecting any.