October 2016 \ News \ SPECIAL COLUMN ON LAW & DIPLOMACY
Joint venture in India

The Joint Venture (JV) represents a newly created business enterprise; its participants continue to exist as separate firms.

By K K Anand

REASONS FOR ENTERING INTO A JOINT VENTURE

2.1 A company may want to enter into a foreign market with which it is not familiar.

2.2 The joint venture allows the parties to the venture to undertake a potentially speculative and high risk endeavour without exposing assets unlimited liability.

2.3 The joint venturing parties can define at the outside of the project, the extent to which each shall be liable for costs and how the risks associated with the venture shall be allocated.

2.4 A joint venture may be entered into for competitive considerations for example a joint venture with a potential competitor may reduce or eliminate competition.




Tags: K K Anand

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