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View the related checklists about Joint venture company (JVC)

Exiting a joint venture—checklist

Exiting a joint venture—checklist This Checklist identifies the different routes to termination or exit from a joint venture (JV) and the considerations which apply depending on the exit path chosen. For guidance on responding to a JV dispute, see Practice Note: Joint venture disputes—how to respond. For further detailed guidance on terminating joint ventures in the context of a specially created or nominated joint venture company (JVC), see Practice Notes: • Termination—corporate joint ventures • Tax implications of operating and terminating a joint venture company • Corporate joint venture dispute—dealing with deadlock: initial considerations • Majority-minority joint venture dispute—a practical illustration Embarking on a JV relationship in the first instance usually involves considerable planning and effort on the part of the JV parties who have decided to partner one another for mutual gain (usually by sharing cost, resource and experience). You will need to consider the full implications of ending or exiting the JV, as to whether there are sufficiently good reasons for being prepared to see that investment lost...

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Transfer of shares where right of first refusal (ROFR), drag along and tag along provisions apply—flowchart

Transfer of shares where right of first refusal (ROFR), drag along and tag along provisions apply—flowchart This flowchart, produced in partnership with Anthony Shatz of Fladgate LLP, illustrates the steps to be taken and the

Majority-minority joint venture dispute—a practical illustration

Majority-minority joint venture dispute—a practical illustration This Practice Note identifies the key factors you should consider when advising a client where an issue or potential dispute has arisen in the operation of a joint venture. In this case the joint venture (JV) relationship has been established by the creation of a private limited company, the joint venture company (JVC). This Practice Note should be read alongside Practice Note: Corporate joint venture dispute—dealing with deadlock: initial considerations. For general guidance on responding to a threatened dispute in a JV context, see Practice Note: Joint venture disputes—how to respond. Joint venture company disputes—initial considerations Whatever structure is used to establish the JV relationship, central to the relationship is the joint venture agreement (JVA) which sets out the JV parties' obligations to one another and which they can enforce as against each other. Needless to say, this is a contract between the parties and, as such, interpreting its provisions requires application of the general rules of contract interpretation. For guidance, see:...

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Joint venture shareholders’ agreement—deadlock (50:50)

Joint venture shareholders’ agreement—deadlock (50:50) This Agreement is made on [insert date] 20[insert year] Parties 1 [Insert name of first shareholder] incorporated in England and Wales under number [insert company number] whose registered office is at [insert address] ([A]), 2 [Insert name of second shareholder] incorporated in England and Wales under number [insert company number] whose registered office is at [insert address] ([B]), and 3 [Insert name of the company in which the shares are held] incorporated in England and Wales under number [insert company number] whose registered office is at [insert address] (the Company). BACKGROUND (A) The Company, at the date of this Agreement, has in issue ordinary shares of £[insert nominal value] each, of which one ordinary share has been issued fully paid and is registered in the name of [A] and one ordinary share has been issued fully paid and is registered in the name of [B]. (B) The Company shall carry on business in accordance with the terms and conditions of this Agreement....

Articles of association—joint venture company—corporate real estate—deadlock (50:50)

Articles of association—joint venture company—corporate real estate—deadlock (50:50) Private Company Limited By Shares Articles of Association of [Insert name of company] Limited (Incorporated in England and Wales under registered no. [insert number]) (Adopted by Special Resolution passed on [insert date] 20[insert year]) 1 Model Articles 1.1 The Model Articles shall apply to the Company, except insofar as they are modified or excluded by these Articles or are inconsistent with these Articles, and, subject to any such modifications, exclusions or inconsistencies, shall together with these Articles constitute the articles of association of the Company to the exclusion of any other articles or regulations set out in any statute or in any statutory instrument or other subordinate legislation. 1.2 The whole of Model Articles 6(2) (committees), 7 (directors to take decisions collectively), 8 (unanimous decisions), 9(3) and 9(4) (calling a directors’ meeting), 11(2) and 11(3) (quorum for directors’ meetings), 12 (chairing of directors’ meetings), 13 (casting vote), 14(1–5) (conflicts of interest), 16 (directors’ discretion to make further rules), 17 (methods of appointing...

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Can the inclusion of drag along rights in the articles of association of a joint venture company be considered to be unfair prejudice on a minority shareholder?

Can the inclusion of drag along rights in the articles of association of a joint venture company be considered to be unfair prejudice on a minority shareholder? Drag along and tag along rights are commonly included in joint venture (and indeed private equity investment) articles of association. They ensure that if the majority shareholders agree to sell their shares: • the minority shareholders can be obliged to sell on the same terms so as to deliver 100% ownership to the buyer, thus maximising the price per share (drag-along), and • the minority shareholders can ensure that they can sell on the same terms as the majority and are not left with a rump of unsaleable (or less valuable) shares following a sale by the majority (tag along) Where these rights are included in the company's articles from a point before the shareholders subscribe, they are most unlikely to be found to be unfairly prejudicial (rather, they may be regarded as 'market standard'). More difficult issues may arise...

Can the National Security and Investment Act 2021 apply to corporate joint venture transactions?

Can the National Security and Investment Act 2021 apply to corporate joint venture transactions? Scope of regime As part of a general trend towards the stricter control of foreign direct investment, the National Security and Investment Act 2021 (NSIA 2021) came fully into force on 4 January 2022. It establishes a new standalone statutory regime that allows the government to review and intervene in a wide range of investments in businesses (including joint ventures) that are active in the UK or acquisitions of related assets, with the ultimate objective of protecting national security. The ability to ‘call-in’ a transactions under NSIA 2021 applies, retrospectively, to any transaction completed on or after 12 November 2020. The regime falls into two parts: • a mandatory notification regime, which applies from 4 January 2022, such that anyone acquiring control of entities that are active in 17 specific sectors in the UK, will have to be notified to the government and must be cleared before completion. The notification obligation applies regardless of...

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Singapore—stay of proceedings and shareholder disputes (BTY v BUA)

Arbitration analysis: The Singapore High Court evaluated the question of how to establish when a shareholders’ dispute should be referred to arbitration or to court under the relevant company law. Shaun Lee of Bird & Bird outlines the nuance and precedents for a decision that will be of considerable interest to practitioners.

Court dismisses 'hopeless' urgent disclosure application (AB International (HK) Holdings v AB Clearing Corporation)

Arbitration analysis: the Commercial Court dismissed an application for urgent interim relief pursuant to section 44(3) of the Arbitration Act 1996 (AA 1996) in support of LCIA arbitration proceedings commenced the day before the application was heard (and before the tribunal was constituted). Although an extreme case, which the judge stated did not ‘come close to satisfying the requirements of [AA 1996, s 44(3)]’, the decision is of interest to practitioners as it reinforces the clear policy that the English won’t interfere with the arbitration process without clear justification.