Joint Venture is the Anglo-Saxon term used to refer to the agreement between two or more companies that pool their resources in order to complete a common task or reach the same goal. This task or objective can be to launch a new project or any other type of business activity. In Spanish it is known as a joint venture.
In a Joint Venture, each of the companies is involved in both the profits, the losses and the costs associated with the activity. However, a Joint Venture has its own entity and does not have to be linked to the particular interests of the companies that form it.
At a legal level, Joint Ventures are regulated by European and also Spanish legislation. They can take different legal forms.
Joint Venture Agreement
Regardless of the legal form that has been chosen, the most important document of any joint venture is the Joint Venture contract in which the reasons that have led to the union as well as the rights and responsibilities are established. obligations of each of the participants. It includes:
- The objectives of the Joint Venture
- The initial contribution of the participants,
- How the operations will be carried out each day
- The right to profits (and responsibility for losses).
It is very important to write this document in detail as you can avoid legal problems during the course of it. In this link you will see a Joint Venture contract model in which the different parts that must compose it can be observed.
Joint venture tipos