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Joint Venture Lawyers

Joint Venture Lawyers

Joint Ventures

Perth Commercial & Corporate Lawyers

If you are looking to enter a joint venture with another person or company, whether for business development, business expansion or property development projects, West Perth Legal can assist you with legal aspects of setting up a joint venture.

West Perth Legal’s legal services for joint ventures:

Advising on and setting up of a joint venture structure: advising on a suitable joint venture structure in accordance with your objectives, nature of business or project and risk tolerance.

Legal due diligence: conducting court searches of your JV partner.

Professionally drafted agreements: drafting customised agreements including joint venture agreements, joint venture management agreements, shareholders agreements, independent contractor agreements, confidentiality agreements, etc.

Legal review: reviewing and providing advice on draft or existing joint venture agreements.

Legal negotiation: negotiating the terms of a joint venture agreement & associated documents.

Joint Venture Lawyer
Joint Venture Agreement Lawyer

What is a Joint Venture?

Joint venture is a term commonly used when two parties come together for a common goal. A joint venture is typically formed for business expansion, research and development, large infrastructure projects, innovation and entering new markets or industries.

Generally, the parties to the joint venture join forces specifically for a project, without expecting a long-term partnership beyond its completion. The joint venture project is a limited, focused effort with a set duration, after which the parties anticipate receiving their share of the profits. Each party brings essential skills or resources, like technical expertise or funding, to the table.

Examples of joint ventures are:

  • Two organisations working together to enter a new market
  • Two organisations working together to provide a more comprehensive package of services to its clients
  • Two organisations working together to create a new product
  • Two organisations working together to explore potential new way of producing or supplying a product
  • Developer, landowner and/or investors working together on a property development project

Various benefits of joint venture include the sharing of resources, risks, expertise, the ability to gain more capital or enter certain markets and industries, and possible tax advantages (depending on the legal structure used).

West Perth Legal’s Commercial Lawyers can assist with providing advice on the suitability of a joint venture structure for your objectives; drafting the joint venture agreement and related documents to take into consideration liability, management, cost sharing, assignment of interests; and negotiating the terms of the agreement with other parties.

Legal Considerations for a Joint Venture

Legal Structure for a Joint Venture

A joint venture can take on a variety of legal structures. This includes a corporation, a trust, a partnership or an unincorporated association. The most used structures are incorporated and unincorporated joint ventures. Different legal structures carry different legal risks and liabilities, and tax advantages. As such, it is important to speak to a lawyer and an accountant when setting up your joint venture.

Contribution & Legal Liability

Joint venture agreements should specify the contributions required by each party, whether the parties are liable in respect to costs, losses and debts of the joint venture and in what proportion. Typically, parties should seek to have limited liability.

Protection & Ownership of Assets

Joint venture parties should consider if the participants should have separate interests in the assets used in the joint venture. These include physical assets or intellectual property rights.

Management of Joint Venture

Joint venture parties should consider who should manage the joint venture and whether to appoint a manager or operator acting as agent of the parties. The parties to a joint venture may be bound by the acts of a manager or operator acting as agent, which creates liability risk for each party. This can be minimised with an appropriate legal agreement with the agent.

Joint Venture Participating Interests & Assignment

Joint venture parties should define the participating interests of each party, the joint venture activities, and when the parties have the right to share the product or output of the activities and in what proportions. An assignment of participating interest can be addressed through an assignment provision.

Joint Venture Dissolution & Dispute Resolution

Joint venture parties should consider when the joint venture activity ceases, and what happens in the event of default. Usually, a joint venture agreement will include a provision for dispute resolution, and termination of the joint venture.

Joint venture parties to a corporation who wishes to sell its shares could also consider agreeing to pre-emptive rights in its agreement with the provision of ‘tag along’ and ‘drag along’ rights. These determine which party has right to compel the other to sell its shares in the joint venture to a third-party purchaser and on what terms.

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