Association of two or more entities (whether corporate, government, individual or otherwise) combining property and expertise to carry out a single business enterprise and having a joint proprietary interest, a joint right to control and a sharing of profits and losses.
- Regardless of the scope of the undertaking, the nature of the JV must:
- be a separately identifiable entity
- have an ownership interest in such entity by each joint venture partner (“JVP”); and
- have an active management involvement or deliberate rejection of the right to such involvement by each JVP.
JVs are common and successful in several industries. For example, in the land development and construction industries, JVs are often used to obtain sufficient financing to acquire large land tracts or to undertake major building projects. JVs are also common in the manufacturing, mining, and service industries.