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What are joint ventures?

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Business organisations can be of various types

private or government owned or global

enterprises. Now, any business

organisation if it so desires can

join hands with another business

organisation for mutual benefit. These

two organisations may be private,

government-owned or a foreign

company. When two businesses agree

to join together for a common purpose.

and mutual benefit, it gives rise to a

joint venture. Businesses of any size

can use joint ventures to strengthen

long-term relationships or to

collaborate on short term projects. A

joint venture can be flexible depending

upon the party’s requirements. These

need to be clearly stated in a joint

venture agreement to avoid conflict at

a later stage.

A joint venture may also be the

result of an agreement between two

businesses in different countries. In this

case, there are certain provisions

provided by the governments of the two

countries, which will have to be

adhered to.