The joint venture created by this agreement (the “joint venture”) will operate under the name [JOINT VENTURE NAME] and have its address registered under [ADDRESS]. The joint venture is considered in all respects as a joint venture between the contracting parties and, under no circumstances, this agreement can be construed as ensuring a partnership or other loyalty relationship between the parties. There are three main reasons why companies create joint ventures: any joint venture entity that could be individuals, groups of individuals, businesses or companies retains its own legal status. A joint venture can be created through a contract that identifies the resources such as money, real estate and other assets that each company brings to the business. The contract also defines how the business is managed and the distribution of control of the business, profits and resulting losses. In a joint venture (JV), each participant is responsible for the profits, losses and associated costs. However, the entity is a separate entity, separate from the other business interests of the participants. Once the joint venture (JV) has achieved its objective, it can be liquidated or sold like any other business. Microsoft Corporation (NASDAQ: MSFT) sold its 50% interest in Caradigm in 2016, a joint venture established in 2011 with General Electric Company (NYSE: GE). The joint venture was created to integrate Microsoft Amalga Enterprise Healthcare`s data and intelligence system with a variety of GE Healthcare technologies. Microsoft has now sold its stake in GE, virtually ending the joint venture. GE is now the sole owner of the company and is free to continue the business as it sees fit.
A joint enterprise contract is legally binding in most jurisdictions and can be used by the courts to claim damages if one of the parties departs from contractual terms. Joint ventures, while a partnership in the familiar sense of the word, can adopt any legal structure. Businesses, partnerships, limited liability companies (LCs) and other entities can all be used to create a joint venture. Despite the fact that the purpose of the joint venture is typically intended for production or research, they can also be set up for continuous purposes. Joint ventures can combine large and small businesses to take over one or more projects and small projects and deals, big or small. A joint venture agreement, also known as a joint venture agreement, is used when two or more business entities or individuals enter into a temporary business relationship (joint venture) to achieve a common goal. If the joint venture results in the creation of a new entity, it can be structured as a company, limited liability company or company. For example, if the joint venture is a company and the two founding companies want the same control, they would generally structure the joint venture so that each founding company has an equal number of shares in the company as well as equal management responsibility and representation on the board of directors.