A joint venture (JV) is an alternative business arrangement in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task. This may be a new project being entered into together or some other joint business activity.
Under English law a joint venture has no specific meaning and the commercial arrangement between the parties can take a number of different forms depending on what the parties are trying to achieve. Sometimes a JV will be formed by means of a contractual agreement between the parties (where the parties prefer such a simply, relatively loose commercial arrangement). Alternatively the parties might wish to have a more formal, tighter structure, in which case they might decide to form a new JV company with the parties being the shareholders.
This subfolder contains a form of contractual joint venture agreement, the Contractual Joint Venture Agreement, and a Legal Vehicle Comparison Chart (comparing four legal forms of JV) which may be useful for business customers considering which way to structure a JV arrangement.
Further document templates - for setting up other forms of JV - can be found in the Corporate folder.
Joint Venture Templates is part of Business . Just £38.50 + VAT provides unlimited downloads from Business for 1 year.
Frequently Asked Questions
Two businesses want to work together on a project. What is a joint venture and how do we set one up? +
A joint venture is where two or more parties pool resources for a shared purpose, such as a specific project. English law gives joint venture no fixed legal form, so you choose the structure: a contractual joint venture (an agreement between the parties) or a corporate one (a new JV company they own together). This subfolder provides a Contractual Joint Venture Agreement and a chart comparing JV structures.
Should our joint venture be a contract or a new company? +
It depends on how tight a structure you want. A contractual JV is simpler and looser: the parties stay separate and are bound only by their agreement. A corporate JV puts the venture in a new company the parties own as shareholders, giving limited liability and a clearer structure but more formality and cost. The Legal Vehicle Comparison Chart in this subfolder weighs the options for you.
What must a contractual joint venture agreement cover? +
The shared purpose and scope, what each party contributes, how profits, losses, control and decisions are shared, ownership of any IP created, confidentiality, how disputes are resolved and how the venture ends or a party exits. Gaps on these points are where joint ventures fall out. The Contractual Joint Venture Agreement in this subfolder is drafted around them so the main risks are addressed up front.
Are there other joint venture structures beyond a contract or a JV company? +
Yes. Depending on the aim, a JV can also run through a partnership or a limited liability partnership, each with different tax, liability and governance features. This subfolder focuses on the contractual JV and compares the main vehicles; templates for setting up other forms of JV, including company and LLP structures, are in the Corporate folder. Match the vehicle to your tax and liability needs.
