Capital Contribution and Ownership Rights

• Shareholders in a JV are responsible for contributing capital in the form of cash, assets, or technology.
  
• Their ownership percentage in the company is determined by the number of shares they hold.
  
• Shareholders share in the profits and losses of the JV in proportion to their equity holding.
  
• They have the right to receive dividends, subject to the company’s profitability and board approval.
  
• In case of winding up, they are entitled to a share in residual assets after debts are paid.
  

Decision-Making and Voting Rights

• Shareholders exercise control through their voting rights, typically proportional to their shareholding.
  
• They vote on key issues such as appointment of directors, amendments to the JV agreement, capital restructuring, and mergers or acquisitions.
  
• Shareholders may have reserved matters, requiring unanimous or special majority approval.
  
• Minority shareholders may have protective rights, such as veto on critical decisions or access to information.
  
• Voting can occur in annual general meetings (AGMs) or extraordinary general meetings (EGMs).
  

Appointment of Directors and Governance Oversight

• Shareholders nominate or elect representatives to the board of directors, who oversee the JV’s operations and policies.
  
• The board acts as a bridge between shareholders and management, ensuring strategic alignment.
  
• Shareholders can demand board reports, performance updates, and management accountability.
  
• In some JVs, each shareholder is entitled to nominate one or more nominee directors.
  
• Shareholders may also participate in board committees for audit, finance, or compliance.
  

Compliance and Fiduciary Duties

• Shareholders must comply with the terms of the JV agreement, company’s Articles of Association, and applicable laws.
  
• They are expected to act in good faith, especially in closely held JVs where trust and cooperation are essential.
  
• Shareholders are required to disclose conflicts of interest and refrain from competing with the JV’s business.
  
• They must not misuse confidential information or trade secrets acquired during their association with the JV.
  
• Certain actions like transfer of shares or exit may be subject to restrictions such as lock-in, right of first refusal, or drag-along/tag-along rights.
  

Exit, Transfer, and Dispute Rights

• Shareholders have the right to transfer shares in accordance with the JV agreement and applicable company law.
  
• The agreement may define exit mechanisms, such as share buy-back, sale to third parties, or IPO.
  
• Shareholders may initiate dispute resolution through negotiation, mediation, arbitration, or court proceedings.
  
• In case of deadlock or partner insolvency, they may seek exit or termination remedies as specified in the JV terms.
  
• Minority shareholders may invoke rights for protection against oppression and mismanagement under the Companies Act.