Business joint ventures and collaborations are common. There are many advantages of sharing the cost and risk of a new business and sometimes a Joint Venture is appropriate because the parties will bring very different expertise or assets which mean a product or service couldn’t be brought to market without collaboration.

We deal with all types of business joint ventures ranging from start up businesses which are not joint ventures in the usual sense (being 2 established businesses working together) through to property joint ventures, IP joint ventures and highly complex arrangements which may have parties in different legal jurisdictions or involve very technical plans or products.

We are very experienced in dealing with joint ventures of all kinds, with different strategic objectives and for a wide range of buisnesses and sectors. We also work very regularly where 1 party is UK based and the other is not.

Our legal advice and services can range from drafting or reviewing a joint venture agreement, often with an additional shareholder agreement and changes to company articles through to very complex transactions involving multiple companies, tax structures, different classes of shareholders, employment law issues or product development specifications.

Please do get in contact to find out about our experience and for an initial discussion about your proposed joint venture.

Structure of the Joint Venture

Joint Ventures can range from relatively loose collaboration arrangements not involving setting up new or separate legal entities through to complex structures involving the setting up of new companies.

Some of the most common structures for joint ventures include collaboration agreements and Special Purpose Vehicles (“SPV’s”) which involve setting up of a new company or companies solely for the purpose of the joint venture.

Key issues with Joint Venture Agreements 

The complexity of a joint venture agreement will vary based on many factors. If the Joint Venture will be between the 2 contracting parties via their existing companies, some of the issues below will not apply. They will apply if thje joint venture will be structured using a new limited company.

Some of the most common issues with a joint venture agreement include:

• Shareholder agreement and articles for joint ventire company – what to include in the shareholder agreement and company articles of association in addition to the joint venture agreement.
• Investment –  what will be the agreed financial and other contributions from the parties to the JV?
• Employees – will the special purpose company have employees? If so, will they be new employees or employees from the joint venture existing businesses?
• IP – This is likely to be a key issue.Will the parties be contributing some existing IP assets to the joint venture company? Who will own the joint venture IP? What happens to the IP at the end of the joint venture?
• Equity shares and board control – The equity position for any special purpose company and who will be on the board of directors?
• Veto or other blocking rights – What legal powers or restrictions need to be considered based on the respective shareholdings and board composition of any new company set up for the joint venture.
• The exit strategy – is the plan to sell the joint venture business at some stage? If so, what if the shareholders don’t agree on sale?
• Is the joint venture time limited? – Should the joint venture be for a fixed term?
• Dispute Resolution – consider what scenarios might result in an event of default whereby the JV gets terminated and what happens if there is a serious, fundamental or repudiatory breach by 1 of the parties or 1 of them becomes insolvent or changes ownership?
• Employees – will any existing employees of either business be working for a newly formed joint venture entity? If so, TUPE and other employment law issues will arise.

Solicitors for a joint venture agreement

Please do get in contact to discuss how our corporate lawyers can assist with your proposed joint venture. We are experienced, flexible and highly practical, understanding at all times the need for proportionate legal fees and working to tight timescales.