The joint venture agreement
The joint venture agreement

The following Corporate guidance note provides comprehensive and up to date legal information covering:

  • The joint venture agreement
  • Principal documents
  • Purpose of the joint venture agreement
  • Parties to the joint venture agreement
  • Business of the joint venture
  • Board and management arrangements
  • Share capital and subscription for shares
  • Funding arrangements and other contributions to the joint venture
  • Distribution of profits
  • Restrictive covenants
  • more

The law as set out in this Practice Note may be affected by Brexit. For further details of its impact, see Practice Note: Brexit—impact on corporate joint ventures.

Principal documents

The principal documents required for a corporate joint venture are:

  1. the articles of association (articles) of the joint venture company (JVC), and

  2. the joint venture or shareholders’ agreement (JVA)

For a discussion about what is typically covered in the JVA, as opposed to the articles, see Practice Note: Documenting the corporate joint venture.

Purpose of the joint venture agreement

The purpose of the JVA is to establish the rights and obligations of the parties in relation to the joint venture, to ensure that the company and its business is established and run in accordance with the parties’ objectives and to set out procedures for dealing with any difficulties which may arise.

Key matters covered in the JVA are:

  1. the business of the joint venture

  2. the composition of the board and management arrangements

  3. share capital and funding of the JVC

  4. distribution of profits

  5. restrictive covenants

  6. protection of minority and majority interests (if applicable)

  7. resolution of deadlocks

  8. transfer of shares, and

  9. termination

For agreements covering deadlock and majority/minority interests issues, see Precedents: Joint venture shareholders’ agreement—deadlock (50:50) and Joint venture shareholders' agreement—majority or minority.

Parties to the joint venture agreement

The parties