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Joint Venture Agreements

2. Joint Venture Agreement

A joint venture is an agreement between parties for a particular purpose or venture. A joint venture is, in effect, a form of partnership that is limited to a particular purpose or limited in time. Joint ventures have grown in popularity in recent years.

Most joint ventures are formed for the purpose of saving time and money. Joint ventures are attractive because they enable companies to share both risks and costs. Many research and development projects are performed through joint ventures between two companies. Also, marketing joint ventures are popular as well as scientific and engineering projects.

Since each party is responsible for the total profits and losses from the joint venture, the tax implications are passed through to the parties.
 
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