A joint venture between Company A and Company B, gives Company B access to the manufacturing facility and manufacturing equipment without having to purchase or lease the equipment, while Company A produces the product Company B developed without incurring research and development costs.Īn alternative to a cross-border business merger and acquisition, an international joint venture is a business strategy often used among companies seeking to reach new foreign customers, a specific consumer market, technology or achieve a common goal. In a common international joint venture structure, a foreign company agrees with a local company to share legal ownership and contribute resources, technologies, capital and knowledge to pursue business opportunities together.Īn international joint venture has elements of a partnership but is typically formed for a defined purpose or a specific project, and as a result is limited in duration, scope and purpose.įor examples, Company A has production facilities and the technology to manufacture in country A and Company B in Country B needs to create a product and distribute it. The location of the international joint venture is usually where the operations of the venture are or in the country where one of the partners is physically located. An international joint venture is often described as two or more businesses or business partners based in different countries coming together to form a joint enterprise ![]() International joint ventures aids companies to establish strategic business allianceswhich allows them to access the global marketplace more economically and effectively, and reduce the legal, regulatory, cultural, language and currency differences. American businesses, for example, seek to explore and develop their capabilities to source or distribute goods, services or intellectual property internationally, while non-American businesses wish to access the United States marketplace.īecause most businesses, except for the largest of companies, lack the infrastructure, management, financial resources and required know-how to enter new markets, forming an international joint venture is an attractive option. With the pace of globalization increasing, international joint ventures are becoming a common phenomenon. The advantages of international joint ventures enable businesses from different countries to cooperate and rapidly expand into new markets. P-1 Visa Athletes and Entertainment Groups.EB-1C Multinational Manager and Executive.E-2 Visa – Requirements, Eligibility and Benefits.Litigation, arbitration and risk management. ![]() Fiduciary duties of officers and directors.Joint Ventures and International Business Agreements.Directors’ Liabilities and Responsibilities.
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