Definition of a Project-Specific Joint Venture

• A project-specific joint venture is a temporary business arrangement formed exclusively to execute a single, defined project.
  
• It is established by two or more parties who pool resources, expertise, and capital for the duration of the project.
  
• Once the project is completed, the JV is either dissolved or terminated as per the agreed terms.
  
• It is commonly used in sectors like infrastructure, construction, engineering, energy, and IT services.
  
• This structure allows parties to share risks, responsibilities, and returns for a limited scope and timeframe.
  

Key Characteristics

• The JV is goal-oriented with a specific project, location, budget, and timeline.
  
• It may be formed as a special purpose vehicle (SPV), partnership, or contractual consortium.
  
• The ownership, control, and management are defined by the project’s needs and each partner’s contribution.
  
• It is not intended for long-term or continuous operations beyond the identified project.
  
• Roles are distributed clearly—e.g., one partner may handle design, while another executes construction.
  

Advantages of Project-Specific JVs

• Focused collaboration on a single deliverable or objective.
  
• Limited liability and risk exposure confined to the project scope.
  
• Efficient resource utilization with access to specialized expertise and assets.
  
• Cost sharing reduces financial burden for each partner.
  
• Simplified exit mechanism once the project concludes.
  

Legal and Contractual Framework

• The JV agreement outlines the scope of work, duration, capital commitments, revenue sharing, and exit terms.
  
• It includes clauses for intellectual property, confidentiality, dispute resolution, and force majeure.
  
• In India, such JVs must comply with the Indian Contract Act, Companies Act (if incorporated), tax laws, and sectoral regulations.
  
• Registrations like PAN, GST, and local project clearances must be obtained in the JV’s name.
  
• Termination and asset distribution are handled as per the JV agreement or upon project completion.
  

Examples and Use Cases

• A JV between an Indian infrastructure company and a foreign engineering firm to build a metro rail line.
  
• A technology JV to deliver a government IT system or smart city project.
  
• A construction JV formed to develop a power plant, bridge, or dam under a public-private partnership (PPP).
  
• JVs created to fulfill eligibility or financial qualification in government tenders or EPC contracts.