Joint Ventures

2 Matter Plans Included

ALERTS - Nil
Full Commentary - Joint Ventures
Reference materials
- Electronic Signing and Witnessing
- Business Structures and the Comparative Table
- Looking to the Future
- Further information
Overview

A joint venture is a contractual or corporate business arrangement between two or more participants where they agree to carry out a particular undertaking or project, with a view to realising mutual commercial gain. A joint venture can be formed for a fixed or ongoing period and may be set up for a ...
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Summary of the process

The usual steps in acting in a joint venture matter include:
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A. Getting the matter underway
- File cover sheet - Joint ventures
- To do list - Joint ventures
- First steps
- Retainer instructions - Joint ventures
- Compliance documents
  - Client Due Diligence and Anti-money Laundering Guidance
  - Client Details, Identity Verification and Source of Funds
  - Conflict of interest check
  - Client and matter risk assessment
  - If required - Reporting an issue
    
    Anti-money laundering internal disclosure
- Initial letter to client enclosing Client Care and Terms of Business
- Enclosures for initial letter to client
  - Client care information
  - Terms of business
  - Scope of work - Joint ventures
  - A summary of the joint venture process
- Initial letter to client confirming instructions and enclosing due diligence checklist
- Due diligence checklist - Joint ventures
- Initial considerations
  
  When consulted by a client who is contemplating entering into a joint venture – and assuming that a joint venture is in fact the appropriate vehicle for the proposed project – initial consideration will need to be given to the following, depending on the particular circumstances, but not ...
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- Advantages of joint ventures
- Joint venture structures
  
  The most common factors driving the structure of a joint venture will be the participants’ preferred tax treatment and accounting consideration, for example, whether the participants want to consolidate the joint venture in their existing accounts. The other key drivers of a joint venture’s ...
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- Contractual joint ventures
  
  A contractual, or unincorporated, joint venture is where two participants, co-operate to pursue a business enterprise for a limited period pursuant to an agreement, without establishing a separate entity to conduct the enterprise. A contractual joint venture is governed by the terms of the ...
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- Incorporated joint ventures
  
  An incorporated joint venture involves setting up a new private limited company through which the mutual business activity will be run. Incorporated joint venture participants hold shares in the joint venture company limiting their liability, in relation to the joint venture’s activities, to the ...
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- Time and costs estimates
- If required - Letter to client varying the Client Care and Terms of Business
  - Letter to client varying the Client Care and Terms of Business
- General deeds, agreements, statements, declarations, consents, and execution clauses
  - Deeds and agreements
  - Deeds
    
    Deed for general use
    
    Deed of assignment of agreement
    
    Deed of assignment of agreement with consent
    
    Deed of assignment of an insurance policy
    
    Deed of assignment of equitable interest in residential land
    
    Deed of gift
    
    Deed of guarantee
    
    Deed of release
    
    Deed of release and grant
    
    General deed of indemnity
    
    Library of standard clauses for deeds
    
    Amendment
    
    Confidentiality
    
    Confidentiality - Extensive
    
    Costs
    
    Counterparts
    
    Dispute resolution
    
    Events beyond control
    
    Governing law and jurisdiction
    
    Interpretation
    
    No assignment
    
    Notices
    
    Severance
    
    Third parties
    
    Waiver
    
    Whole agreement
  - Agreements
    
    Agreement for general use
    
    Boundary agreement
    
    Confidentiality agreement
    
    Construction agreement
    
    Heads of agreement
    
    Library of standard clauses for agreements
    
    Amendment
    
    Confidentiality
    
    Confidentiality - Extensive
    
    Costs
    
    Counterparts
    
    Dispute resolution
    
    Events beyond control
    
    Governing law and jurisdiction
    
    Interpretation
    
    No assignment
    
    Notices
    
    Severance
    
    Third parties
    
    Waiver
    
    Whole agreement
  - Statements and declarations
    
    Statement of truth
    
    Statement of truth - High Court
    
    Statutory declaration
    
    Statutory declaration of solvency
    
    Affidavit - General
    
    Exhibit sheet for affidavits - General
    
    Witness statement - Family matters
    
    Exhibit sheet to witness statement - Family matters
    
    Witness statement - Civil matters
    
    Exhibit sheet to witness statement - Civil matters
  - Execution clauses
    
    Execution clauses - Agreements and contracts
    
    Execution clauses - Deeds
    
    Execution clauses - Overseas companies
  - Consents
    
    If required - Personal data consent - General
    
    Letter to client enclosing consent - General
    
    Letter to third party enclosing consent - General
    
    General letter enclosing client consent
    
    General letter enclosing third party consent
    
    Consent to provide information - General
    
    Consent to provide information - General - Third party
    
    If required - Personal data consent - Health professional
    
    Letter to client enclosing consent - Health professional
    
    Letter to third party enclosing consent - Health professional
    
    Letter to doctor enclosing client consent
    
    Letter to doctor enclosing third party consent
    
    Consent to provide information - Health professional
    
    Consent to provide information - Health professional - Third party
    
    Change of name
    
    Change of name deed for an adult - Concise
    
    Change of name deed for a minor - Concise
    
    If required - Enrolment by an adult
    
    Change of name deed for an adult - For enrolment
    
    Statutory declaration - Enrolment of adult change of name deed
    
    Notice for the London Gazette on the change of name of an adult
    
    Consent to enrolment of change of name of an adult
    
    If required - Enrolment by a minor
    
    Change of name deed for a minor - For enrolment
    
    Statutory declaration - Enrolment of minor change of name deed
    
    Affidavit of best interest for the change of name of a minor
    
    Consent to enrolment of change of name of a minor
B. Establishing a joint venture
- Establishing a joint venture
  
  The broad legal, operating and financial issues about which a client who is contemplating entering into a joint venture should be advised include:
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- Documenting the joint venture
  
  Preparing the correct joint venture documentation is core to the practitioner’s role in assisting the participants to achieve their goal. Such documentation can include a joint venture agreement or, if a new joint venture company is to be set up, a shareholder’s agreement and a new company ...
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- Joint venture agreement
- Joint venture agreement - Property development project
- Shareholders agreement for incorporated joint venture
- Project management agreement
- Liability
  
  Liability of joint venture participants to third parties Liability of the joint venture to a third party is governed by the contract with the third party.
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- Taxation considerations
  
  Guidance on giving tax advice Although tax advice often forms only part of the overall advice given to a client under a retainer, the Law Society has published general Guidance for solicitors advising on tax. The guidance summarises the key aspects of the frameworks that apply to practitioners when ...
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- Powers, rights and responsibilities
  
  Control of joint venture The control of a joint venture will usually be vested:
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- Control of joint venture
  
  The control of a joint venture will usually be vested:
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- Management of joint venture
  
  The management structure for a joint venture will depend upon the size and nature of the joint venture project. Joint venture participants will usually agree upon one, or more, of the following alternative methods, which can be provided for in the joint venture documentation and via the By Lawyers ...
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C. Dispute resolution
- Dispute resolution
  
  Generally Dispute resolution procedures should be covered in detail in the joint venture agreement, or the shareholders agreement for incorporated joint ventures.
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- Deed of release
D. Exiting or ending a joint venture
- Withdrawal
  
  A joint venture participant may wish to withdraw from the venture to avoid future financial obligations. The ability to withdraw from a joint venture will depend heavily upon the terms of the joint venture agreement, and the structure of the joint venture.
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- Selling and assignment
  
  By Lawyers matter plan includes a Deed of Assignment and an Asset Sale Agreement which can be used to effect a transfer of an interest in a joint venture. A joint venture agreement will commonly set out a mechanism by which a participant can assign their interest to a third party.
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- Termination
  
  Events that commonly result in the termination of a joint venture include:
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- Joint venture - Asset sale agreement
- Deed of assumption
- Letter - Notice of intention to sell interest in joint venture
- Letter - Notice of intention to terminate joint venture
E. Finalising the matter
- Letter to client finalising matter
- Example invoice
- Invoice recital - Joint ventures
- Enclosure - Explaining the bill
- Closing the file
- File closing checklist
- File review form - General
Comments and suggestions for By Lawyers

Business Structures and the Comparative Table

A comprehensive manual comparing various business structures.
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Overview

This publication is designed to assist when establishing a new business, acquiring an existing business, and changing business structures. It covers the essential elements and the advantages and disadvantages of each possible structure in relation to:
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A. Comparative table
- Comparative table
  
  The following table considers:
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B. The structures
- Sole trader
  
  A sole trader is the simplest business structure. The business has no separate legal existence from its owner. It is owned and run by one individual who is responsible for all debts and liabilities of the business. Sole traders may trade under their own name or register a business name at ...
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- Partnership
  
  A partnership is a relationship between two or more entities carrying on a business to make a profit. A minimum of two partners is required to form a partnership under s 1 of the Partnership Act 1890. There is a statutory maximum of 20 partners, but there are many permitted exceptions, ...
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- Company
  
  Private limited companies There are two different kinds of private limited companies; those where liability is limited by shares, and those where liability is limited by guarantee.
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- Joint venture
  
  A joint venture is not a separate legal entity but an agreement to act in concert for a particular purpose. It is a commercial relationship between two or more entities for a particular undertaking to realise mutual commercial gain. The parties forming a joint venture might each have unique ...
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- Not-for-profit organisations
  
  Associations Associations are not normally considered business structures as they serve to protect a committee and members of a group, usually conducting an activity that will not generate a profit.
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C. Comparing the structures
- Income tax
  
  Income tax is payable on the taxable income of an individual member of a legal structure depending on the type of structure and how the income is taken. The first payment for a new business is made in arears. For a tax year ending 5 April, a self-assessment tax return must be filed by the following ...
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- Capital gains tax
  
  Capital gains tax is applied to any profits made arising from the disposal of an item, for example, by selling, swapping, or giving it away. The gain is taxed, not the amount of money received. Disposals chargeable to capital gains tax include personal possessions except vehicles, additional ...
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- Stamp duty land tax
  
  Sole traders purchasing residential property are treated as individuals, and the same rates and reliefs apply. Partnerships own property in the individual names of the partners, and the individual rates and reliefs apply.
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- Corporation tax
  
  Limited companies pay corporation tax on trading profits, investments, and chargeable gains from selling assets such as land and property, equipment, machinery, or shares. All profits are taxable. There is one rate of tax appliable no matter the profit or gains made. This rate is lower than the ...
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- Asset protection
  
  A sole trader is liable to the full extent of their personal and business assets. In a partnership, the partners are liable for debts of the partnership, including being liable for debts incurred by a partner without the knowledge or authority of the other partners.
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- Control and succession
  
  Most clients seek to minimise their tax liability, protect their assets, and retain full control of their affairs. A sole trader has full control but as seen above is taxed on all income and capital gains and is fully exposed to creditors. Succession can be by way of sale or gifting the assets and ...
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- Set up and running costs
  
  The set-up costs for a sole trader are minimal and this structure also has the lowest running costs. In addition, the principal is not an employee of the business and therefore compulsory employee pension contributions, PAYE and employment rights do not apply. The drafting and signing of ...
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D. Other considerations
- Relationship between entities, names, and trade marks
  
  Many clients believe they have protected a trading name by registering a company name, business name, or domain name. This is not the case. A business name is merely a name under which a business operates. Companies must register with Companies House, and all who pay self-assessed tax must register ...
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- Guidance on giving tax advice
  
  Although tax advice often forms part of the general advice given to a client, practitioners need to bear in mind the following:
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This publication guides practitioners through structuring, managing, and ending joint ventures.

Overview

Precedents in this publication include:

2 Matter Plans Included

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