Legal Capacity to Hire A JV registered as a legal entity (company, LLP, or partnership) has full legal capacity to hire independent contractors. It can enter into service agreements, consultancy contracts, or outsourcing arrangements. The hiring must align with the...
Capital Contribution Each partner is obligated to contribute capital as agreed in the JV agreement. Contributions may be in the form of cash, assets, technology, or intellectual property. Payment schedules and methods must be strictly followed. Non-contribution or...
Incorporation and Business Registration Certificate of Incorporation from the Registrar of Companies (RoC) under the Companies Act, 2013. Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) from the Income Tax Department. Goods and...
Equity Ownership and Voting Rights Control is commonly based on the proportion of equity held by each partner. Shareholding percentage determines voting power on key resolutions. Majority shareholders typically have greater influence over business direction. Equal...
Modes of Fund Repatriation Foreign JV partners can repatriate funds through various legal methods. Common modes include dividends, royalties, technical service fees, management fees, and capital disinvestment. All remittances must comply with the Foreign Exchange...
Supremacy of the Companies Act The Companies Act, 2013 is a central legislation that governs the incorporation, regulation, and dissolution of companies in India. Any JV company formed as a private or public limited company must comply with its mandatory provisions....
Impact on the Joint Venture Agreement The JV agreement typically includes insolvency as a triggering event. Insolvency may lead to automatic termination or trigger the right to buy out the insolvent partner. The agreement may specify a procedure for handling...
Contractual Provision for Extension The JV agreement often includes a clause allowing for renewal or extension. Partners must review the original terms to confirm whether extension is automatic or requires consent. The agreement may specify the duration of extension...
Review of Joint Venture Agreement The first step is to review the JV agreement for any exit, termination, or winding-up clauses. It may specify conditions such as mutual consent, project completion, or breach of terms. Clauses may outline the procedure, notice period,...
Contractual Provisions in JV Agreement The right to withdraw is usually governed by clearly defined exit clauses in the JV agreement. The agreement may permit withdrawal through share transfer, buyout, or voluntary resignation. Conditions for withdrawal, such as...