Some important steps for forming a Joint Venture Company

Published: 19th February 2009
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A joint venture is not to be taken lightly. For a businessperson to embark on a joint venture, he or she needs to be committed and willing to work cooperatively with the other party involved. For more detail visit a person involved in a joint venture can no longer make all of the decisions for the business alone. For it to be truly a "joint venture," there has to be 100% commitment from both sides. India is witnessing a revolution both in the context of liberalization and globalization of the Indian economy and transacting business through Joint ventures set up with foreign partners across various industry sectors. This article sets forth some important steps for forming a Joint Venture Company in India.

When determining whether or not to embark on a joint venture, it is important to ensure both parties are a match with the projected client base. In a joint venture, each party must compliment the other in business. Sometimes, for more detail visit a misunderstanding or a lack of communication can destroy a joint venture. Therefore, it is necessary for both parties to be capable of communicating what they are able to offer to the project and what their expectations are. Prepare the Memorandum and Articles of Association in consultation with the joint venture partners, get them printed and suitably stamped, and submitting the same with required documents like statutory declaration u/s 33 of the Companies Act 1956 {Act} and Form no.18 u/s 146 of the Act regarding address of the registered office, to ROC along with fees payable.

Since money is involved in a joint venture, it is necessary to have a strategic plan in place. In short, both parties must be committed to focusing on the future of the partnership, rather than just the immediate returns. Ultimately, short term and long term successes are both important. In order to achieve this success, honesty, integrity, and communication within the joint venture are necessary.

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