International Joint Ventures: A Showcase Activity for Business Counselors

March 24, 2016

International AgreementsI’ve just wrapped the live presentations of the Business Counselor Institute series on “International Joint Ventures” and I hope that you’ve had a chance to listen to the programs.  They are available “on demand” at West Legal Ed Center.  While cross-border relationships with foreign customers, agents, distributors, manufacturers and other business partners involve substantial levels of interaction and exchange between the parties, perhaps the most challenging transnational collaboration is the “international joint venture.”  The phrase “international joint venture” is not a precise term that describes a specific type of transaction. Rather, it is a more general term of art that encompasses a wide variety of transactions whereby the participants in a joint venture pool their resources to cooperate in the achievement of a common objective.  In the transnational context, this frequently involves one company entering a foreign market through a joint venture arrangement with a foreign firm, but many joint ventures are more flexible, and often more complex, than that.  The international joint venture relationship is shaped by an ever-evolving calculus of law, the confidence each party has in the other and the cultural and business systems of the countries involved.  As I mentioned during the programs, I think that representing clients in their efforts to launch and maintain an international joint venture is one of the most enjoyable experiences you can have as a business counselor.

Parties to an international joint venture are motivated by a variety of factors and the goals and objectives identified by the party certain influence the form of the joint venture and the activities that will be Gutterman WLEC bannerconducted in the name of, and using the resources contributed to, the joint venture. Among other things, joint ventures may be used to share risks, achieve and maintain economies of scale, efficiently and successfully gain access to new markets, tap into financial resources that may not be available internally or through other outside sources, overcome barriers to acquisition or as a prelude to an acquisition once the parties have gathered experience about whether they are good fit for full integration by working together in a joint venture.

In order to get you started in this practice area, I hope you’ll review chapter (§§ 284:1 et seq.) in Business Transactions Solution to find out more about the formation, management, operation and termination of international joint ventures. The chapter describes the general legal characteristics of joint ventures, identification and selection of joint venture partners, the documentation used to form an international joint venture and closing procedures for forming a joint venture.  The chapter also includes discussions of managerial and operational issues and regulation of international joint ventures. The specialty forms library includes several different versions of a memorandum of understanding for an international joint venture, several different examples of a shareholders’ agreement for an international joint venture and a library of alternative and optional provisions for such an agreement and a confidentiality agreement for the formation of an international joint venture. The chapter also includes checklists of activities for formation of joint venture, issues relating to formation of joint venture. tips for drafting a venturers’ agreement. closing procedures for formation of joint venture and principles for successful joint venture management meetings; executive summaries for clients regarding contents and preparation of joint venture business plans, management of joint ventures and termination of joint ventures; a slide deck presentation on international joint ventures to be used for law firm training purposes, guide relating to client discussions on joint ventures and management and operational guidelines for joint ventures form the Business Counselor’s Mini-MBA Program; and a selection of articles on various relating to formation, management and operation of international joint ventures.  If you have questions or suggestions, please contact me at

Titles by Alan Gutterman