A quick reference guide on Contribution of Joint Venture Assets by respective parties and Intellectual Property issues to watch out for in relation to a Joint Venture.
First and foremost is to identify form of the JV:
- Joint Venture Company ("JVC")
- Partnership—either general or limited liability partnership
- Contractual Joint Venture —contractual or non-equity JV can either be a co-ownership model or simply a contract between the parties whereby they retain all their own assets and agree as to their separate rights and obligations.
Issues affecting transfer of assets and IP rights into the Joint Venture will depends on which form will be used. This includes tax, limited liability, regulatory, banking, labor and employment, benefits, IP ownership, third party consents and exit strategies, among others. In case of Contractual Joint Venture, there is no need for any transfer as each party will retain its own assets and IP rights, however, licensing arrangement may still be relevant. In case of a partnership, the position between a simple partnership and a limited liability partnership may be very different, since limited liability partnership is more akin to a JVC. The list of issues below are largely prepared on the basis of transfer into a JVC.
This checklist is a useful reminder of the issues for parties to look out for when contributing assets and intellectual properties into a joint venture. The party should go through the checklist and carefully discuss all the relevant joint venture issues with the other joint venture parties. It is not necessary to circulate the checklist to all joint venture parties unless requested to do so.
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