Search results
Feb 26, 2016 · So, to answer your question, what sometimes happens is the buyer of Company A (ie Company C) puts the contracting parties of Company A on notice that Company A has been acquired and that Company C will now be fulfilling Company A’s contracts.
What is a joint venture? This guide provides an overview of the most common legal structures used in joint venture arrangements in the UK.
Who runs the joint venture company on a day-to day basis? How are key decisions made by the joint venture company? How do the joint venture parties address conflicts of interest? How can the governance of an unincorporated joint venture work?
- Board Members Or Board Observers?
- Authority Levels and Consent Matters
- Best Business Practice
- Flexibility of Decision Making
- Failure to Achieve Consensus
- Business and Financial Information
- Reliance on Shareholders
- Should The Parties Agree A Mutual Duty of Good Faith?
Whilst it would be typical for shareholders with a certain level of shareholding to have the right to appoint one or more directors to sit on the board of the JV company, in difficult trading environments, there may be concerns about the personal liability implications of a board seat for relevant individuals. This may in part be addressed by D&O c...
Defining the limits of delegated authority to executive management teams will be important whether shareholders are represented by nominee directors on the board or not. As a related point, further limits on the authority of the JV company’s management are also typically imposed by the use of so called reserved or veto matters. The scope of such ma...
In terms of the standards of business practice and compliance, a well drafted joint venture agreement will set out the business standards required of the joint venture as well as the processes and procedures underpinning such standards. Given the legal liabilities (including criminal liability) that may attach to joint venture participants under an...
Governance protections will typically stipulate minimum notice periods for board meetings (and the frequency and permitted location of or manner of holding such meetings) but the parties may need additional flexibility or relaxations of such requirements in fast moving or emergency situations. However, caution may be needed, especially where tax re...
Where there is disagreement on matters identified as requiring unanimity or the approval of certain identified shareholders, a related question is what should happen if a deadlock is reached. Whilst the practical answer may be that matters in question should simply not be effected or implemented without the required level of agreement, some shareho...
Detailing the nature and extent of information to be provided to shareholders and board appointees (both to support the decision making processes and to track progress against plans) is important especially where an emergency or contingency plan may be in operation.
Depending on the underlying rationale for the joint venture, its anticipated level of operating autonomy and the skill sets of the joint venture partners, goods/and or services may be provided to the JV company by one or more shareholders. Where this is the case, a number of issues should be considered. In any economic environment, provisions to en...
The English courts have long struggled with the question as to whether certain types of legal relationship should import implied duties for the parties to deal with each other in good faith – with some cases highlighting that this can be the case in the context of so-called relational agreements. It would also seem clear that the English Courts wil...
If a JV is established by way of a UK incorporated company then UK company law will apply e.g. the Companies Act 2006. A limited liability partnership will be created under and governed by the Limited Liability Partnerships Act 2000.
- 377KB
- 12
This note summarises the key considerations in establishing a joint venture or other strategic alliance, including possible vehicles and legal structures, and accounting and tax aspects. The note also looks at common documents used in joint ventures such as the shareholders' agreement and subsidiary documents.
People also ask
What happens if a company a becomes a JV company AC?
Who owns a joint venture company?
What is a joint venture (JV)?
How does a joint venture company make decisions?
Can a JV be incorporated through a company?
Should a business enter into a JV?
Feb 25, 2014 · If you are forming a new Joint Venture company, a Joint Venture Agreement and the new company’s articles of association are crucial. Points that may be covered in these documents or in separate agreements include: the financing arrangements for the Joint Venture. agreements not to compete with the Joint Venture.
