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A Joint Venture To Be or not to Be That is the question

S
Steve Tennant

This document discusses a joint venture and provides guidance on determining whether or not to pursue one. It covers definitions of a joint venture, reasons for entering into one, factors to consider when selecting a joint venture partner, and differences between incorporated and unincorporated joint ventures. The document is authored by Steve Tennant and intended to help readers decide if a joint venture is the right strategic option.

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息 Steve TennantConsultancy Ltd2001 1 A Joint Venture: To Be or Not to Be? That Is the Question By Steve Tennant FInstCES
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 2 Mind Reader? 則 Think of a whole number from 1 to 10 則 Multiply that number by 9 則 If the number is a 2-digit number, add the digits together 則 Now subtract 5
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 3 Mind Reader? (Contd.) 則 Determine which letter in the alphabet corresponds to the number you ended up with (example: 1=a, 2=b, 3=c, etc.) 則 Think of a Country that starts with that letter
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 4 Mind Reader? (Contd.) 則 Remember the last letter of the name of that Country 則 Think of the name of an Animal that starts with that letter 則 Remember the last letter in the name of that Animal
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 5 Mind Reader? (Contd.) 則 Think of the name of a Fruit that starts with that letter 則 Think of the Animal in the Country eating the Fruit
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 6 Mind Reader? (Contd.) 則 Are you thinking of a Kangaroo in Denmark eating an Orange?
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 7 What Is a Joint Venture? 則 An Apology to William Shakespeare 則 "To be, or not to be,-足-足that is the question:-足-足 Whether 'tis nobler in the mind to suffer The slings and arrows of outrageous fortune Or to take arms against a sea of troubles, And by opposing end them?" From Hamlet, Prince of Denmark 1601 Act III. Scene 1. Rows. 56-足61
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 8 What Is a Joint Venture? (Contd.) 則 Definitions 則 There is no generally accepted definition, under Hong Kong Law of a Joint Venture! 則 Form 則 a group of individuals collaborating 則 one or more individuals collaborating with one or more corporate bodies 則 a group of corporate bodies collaborating
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 9 Why Joint Venture? 則 Reduce Competition 則 Obtain or retain a Strategic Resource 則 Profitably utilize Byproducts 則 Overcome Market Entry Barriers 則 Prevent Entry of New Competitors 則 Share Investment Cost and Risk
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 10 Selecting a JV Partner 則 Do they possess required resources & capabilities? 則 What is their position? 則 How exclusive is their access to resources? 則 What is the extent of their capabilities? 則 What is their financial condition?
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 11 Selecting a JV Partner (Contd.) 則 Is their approach to business compatible with ours? 則 What is their approach to business ethics? 則 Do we have an existing relationship? 則 What is their attitude to risk? 則 How do they make decisions? 則 Is the size of our business significant in relation to theirs? 則 Do we have managerial compatibility with them?
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 12 Selecting a JV Partner (Contd.) 則 What is their motivation and commitment to success of the JV? 則 What is their strategic benefit? 則 Will they share control over their contributed assets? 則 What is the extent of the financial commitment they are willing to make? 則 How hungry are they?
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 13 Unincorporated Joint Venture 則 Does a Partnership Exist? 則 Question of Law and of Fact 則 The Partnership Ordinance 則 Tax 則 Treatment 則 Joint and Several Liability 則 To whom?
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 14 Incorporated Joint Venture 則 Limit of Liability 則 Parent Company Guarantee 則 Tax 則 Treatment 則 Dissolving Company 則 Cost
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 15 Is a Sub-足contract a Joint Venture? 則 A Sub-足contract or a Sub-足consultancy is a Contract for Services 則 No shared control 則 No shared risk 則 No shared profit
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 16 What Is Usual in Construction? 則 Employer Organizations 則 Usually Incorporated 則 Contractor Organizations 則 Usually Unincorporated 則 Consultant Organizations 則 Usually Unincorporated
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 17 A Large Scale Contractors JV 則 Distinction of Roles 則 Joint Venturer 則 Responsible Joint Venturer 則 Party E Main Joint Venture (Joint Venture Agreement) Party A Party B Party C Party D Party E Joint Venture Supervisory Board Project Management Organisation Responsible Joint Venturer A Responsible Joint Venturer B Responsible Joint Venturers C & D Sub-足Joint Venture Agrement Sub-足Joint Venture Supervisory Board Party C Party D Sub-足Joint Venture Project Management Organisation Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Responsible Sub-足Joint Venturer C Responsible Sub-足Joint Venturer D Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Insurers Bondsman Other Common Services & Facilities Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Other Common Services & Facilities Joint Venturer's Responsibilities Responsible Joint Venturer's Responsibilities
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 18 Joint Venturers Role Main Joint Venture (Joint Venture Agreement) Party A Party B Party C Party D Party E Joint Venture Supervisory Board Project Management Organisation Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Insurers Bondsman Other Common Services & Facilities Joint Venturer's Responsibilities
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 19 PM Organization Functions Name Project Director Name Construction Manager (Deputy PD) Name Health & Safety Manager Name Commercial Manager Name Programming Manager Name Quality Assurance Manager Name Temporary Works Manager Name Environmental Manager Name Co-足ordination Manager Name Administration Manager 則 Preparation & Maintenance of Safety Plan 則 Implement Company Safety Policy 則 Safety Training 則 Safety Inspection 則 Internal Safety Audit 則 Safety Committee 則 Job Hazard Analysis 則 Accident / Incident Investigation 則 Safety Reporting / Statistics to Engineer, Head Office and others 則 Site Hygiene 則 Training of Junior Staff 則 Environmental Protection Department Submissions 則 Monitoring and Reporting on Environmental compliances 則 Environmental Action Plans 則 Training on Environmental Matters 則 Training of Junior Staff 則 Quality Assurance Plan Implementation 則 Non Conformancy Reporting 則 Document / Records Control 則 Q/A Training 則 Internal Audits 則 Training of Junior Staff 則 System Wide Consultants 則 Interfacing CC Contractors 則 Detailed Design Consultants 則 Railway Operations System -足 Wide Contracts 則 Special Purchase Contractors 則 Supply-足Install Contractors 則 HKSAR Government Departments 則 Hong Kong Railway Inspectorate 則 Utility Undertakers 則 Traffic Diversions 則 Statutory Approvals, Consents and Permits 則 Training of Junior Staff 則 Managing other Managers 則 Preparation of Method Statements 則 Preparation of Materials Submissions 則 Preparation of Sub-足 Contractor Approval Submissions 則 Monthly Report to Engineer 則 Setting Out 則 Management of Contractor's Plant & Equipment 則 Heading up of Site Production Teams including Foundations, Structures, E&M and Architectural Builders Works & Finishes 則 Site Security 則 Works Programme 則 3 Month Rolling Programmes 則 Monthly Programmes 則 Other Programmes Schedules and Reports as required by Project Director / Deputy PD 則 Progress Monitoring / Reporting / Forecasting 則 Payment Milestones and Key Dates Reporting / Forcasting 則 Submission Status Scheduling 則 Integration of CIP and TRIP and other Engineer issued Programmes (if issued) into Works Programmes 則 Training of Junior Staff 則 Payment Applications 則 Measurement & Valuation of Variations 則 Final Account 則 Arrangement & Monitoring of Insurances 則 Insurance Claims 則 Sub-足Contract Tender Enquiries 則 Sub-足Contract Preparation and Administration 則 Training of Junior Staff 則 Site Administration 則 Personnel 則 Site Purchases 則 Petty Cash 則 Book Keeping 則 Stores 則 Training of Junior Staff 則 Design of Temporary Works 則 Checking of Temporary Works Design 則 Independent Checking Engineer's Design Check Certificate 則 Checking of Erection of Temporary Works 則 Independent Checking Engineer's Application of Load to Temporary Works Check Certificate 則 Checking of Removal of Load Bearing Temporary Works 則 Temporary Works Design & Checking Submissions to Engineer 則 Training of Junior Staff
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 20 Responsible Joint Venturers Role Responsible Joint Venturer A Responsible Joint Venturer B Responsible Joint Venturers C & D Sub-足Joint Venture Agrement Sub-足Joint Venture Supervisory Board Party C Party D Sub-足Joint Venture Project Management Organisation Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Responsible Sub-足Joint Venturer C Responsible Sub-足Joint Venturer D Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Other Common Services & Facilities Responsible Joint Venturer's Responsibilities
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 21 Pre-足bid Agreement 則 Exclusivity 則 Confidentiality 則 Expenses during Tender Preparation 則 JV Leader 則 Form of JVA to be substantially as per attached specimen 則 Agreement of Tender 則 Termination
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 22 Joint Venture Agreement 則 Should satisfy Requirements of Tender Documents 則 When does Agreement become Effective? 則 Joint and Several Liability
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 23 Joint Venture Agreement (Contd.) 則 Identify Participants and Participation 則 Identify Management and Methods of Control 則 Decision Making & Breaking of Deadlock 則 Sign or Seal
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 24 Common Problems 則 Battle of the Forms 則 Neutral Drafter 則 Leader or Sponsor Fee 則 What are Sponsors duties? 則 Decision Making 則 Unanimous? 則 Majority?
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 25 Common Problems (Contd.) 則 Dispute Resolution and Applicable Law 則 Follow Main Contract? 則 Use of JV Facilitator 則 Mediation 則 Dissolution of JV 則 Finishing off outstanding matters
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 26 Less Common Problems 則 USA 則 Foreign Corrupt Practices Act, 15 USC section 78dd-足1,2 則 Prosecutions 則 Recorded against each Joint Venturer
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 27 Conclusion The Joint Venture is the most flexible instrument for making fits out of misfits. It will become increasingly important. It is at the same time the most demanding and difficult of all tools of diversification and the least understood. Peter Drucker, Management: Tasks Responsibilities and Practices 1974
A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 28 The End Visit our Web Site at www.stevetennant.com

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A Joint Venture To Be or not to Be That is the question

  • 1. 息 Steve TennantConsultancy Ltd2001 1 A Joint Venture: To Be or Not to Be? That Is the Question By Steve Tennant FInstCES
  • 2. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 2 Mind Reader? 則 Think of a whole number from 1 to 10 則 Multiply that number by 9 則 If the number is a 2-digit number, add the digits together 則 Now subtract 5
  • 3. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 3 Mind Reader? (Contd.) 則 Determine which letter in the alphabet corresponds to the number you ended up with (example: 1=a, 2=b, 3=c, etc.) 則 Think of a Country that starts with that letter
  • 4. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 4 Mind Reader? (Contd.) 則 Remember the last letter of the name of that Country 則 Think of the name of an Animal that starts with that letter 則 Remember the last letter in the name of that Animal
  • 5. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 5 Mind Reader? (Contd.) 則 Think of the name of a Fruit that starts with that letter 則 Think of the Animal in the Country eating the Fruit
  • 6. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 6 Mind Reader? (Contd.) 則 Are you thinking of a Kangaroo in Denmark eating an Orange?
  • 7. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 7 What Is a Joint Venture? 則 An Apology to William Shakespeare 則 "To be, or not to be,-足-足that is the question:-足-足 Whether 'tis nobler in the mind to suffer The slings and arrows of outrageous fortune Or to take arms against a sea of troubles, And by opposing end them?" From Hamlet, Prince of Denmark 1601 Act III. Scene 1. Rows. 56-足61
  • 8. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 8 What Is a Joint Venture? (Contd.) 則 Definitions 則 There is no generally accepted definition, under Hong Kong Law of a Joint Venture! 則 Form 則 a group of individuals collaborating 則 one or more individuals collaborating with one or more corporate bodies 則 a group of corporate bodies collaborating
  • 9. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 9 Why Joint Venture? 則 Reduce Competition 則 Obtain or retain a Strategic Resource 則 Profitably utilize Byproducts 則 Overcome Market Entry Barriers 則 Prevent Entry of New Competitors 則 Share Investment Cost and Risk
  • 10. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 10 Selecting a JV Partner 則 Do they possess required resources & capabilities? 則 What is their position? 則 How exclusive is their access to resources? 則 What is the extent of their capabilities? 則 What is their financial condition?
  • 11. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 11 Selecting a JV Partner (Contd.) 則 Is their approach to business compatible with ours? 則 What is their approach to business ethics? 則 Do we have an existing relationship? 則 What is their attitude to risk? 則 How do they make decisions? 則 Is the size of our business significant in relation to theirs? 則 Do we have managerial compatibility with them?
  • 12. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 12 Selecting a JV Partner (Contd.) 則 What is their motivation and commitment to success of the JV? 則 What is their strategic benefit? 則 Will they share control over their contributed assets? 則 What is the extent of the financial commitment they are willing to make? 則 How hungry are they?
  • 13. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 13 Unincorporated Joint Venture 則 Does a Partnership Exist? 則 Question of Law and of Fact 則 The Partnership Ordinance 則 Tax 則 Treatment 則 Joint and Several Liability 則 To whom?
  • 14. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 14 Incorporated Joint Venture 則 Limit of Liability 則 Parent Company Guarantee 則 Tax 則 Treatment 則 Dissolving Company 則 Cost
  • 15. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 15 Is a Sub-足contract a Joint Venture? 則 A Sub-足contract or a Sub-足consultancy is a Contract for Services 則 No shared control 則 No shared risk 則 No shared profit
  • 16. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 16 What Is Usual in Construction? 則 Employer Organizations 則 Usually Incorporated 則 Contractor Organizations 則 Usually Unincorporated 則 Consultant Organizations 則 Usually Unincorporated
  • 17. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 17 A Large Scale Contractors JV 則 Distinction of Roles 則 Joint Venturer 則 Responsible Joint Venturer 則 Party E Main Joint Venture (Joint Venture Agreement) Party A Party B Party C Party D Party E Joint Venture Supervisory Board Project Management Organisation Responsible Joint Venturer A Responsible Joint Venturer B Responsible Joint Venturers C & D Sub-足Joint Venture Agrement Sub-足Joint Venture Supervisory Board Party C Party D Sub-足Joint Venture Project Management Organisation Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Responsible Sub-足Joint Venturer C Responsible Sub-足Joint Venturer D Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Insurers Bondsman Other Common Services & Facilities Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Other Common Services & Facilities Joint Venturer's Responsibilities Responsible Joint Venturer's Responsibilities
  • 18. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 18 Joint Venturers Role Main Joint Venture (Joint Venture Agreement) Party A Party B Party C Party D Party E Joint Venture Supervisory Board Project Management Organisation Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Insurers Bondsman Other Common Services & Facilities Joint Venturer's Responsibilities
  • 19. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 19 PM Organization Functions Name Project Director Name Construction Manager (Deputy PD) Name Health & Safety Manager Name Commercial Manager Name Programming Manager Name Quality Assurance Manager Name Temporary Works Manager Name Environmental Manager Name Co-足ordination Manager Name Administration Manager 則 Preparation & Maintenance of Safety Plan 則 Implement Company Safety Policy 則 Safety Training 則 Safety Inspection 則 Internal Safety Audit 則 Safety Committee 則 Job Hazard Analysis 則 Accident / Incident Investigation 則 Safety Reporting / Statistics to Engineer, Head Office and others 則 Site Hygiene 則 Training of Junior Staff 則 Environmental Protection Department Submissions 則 Monitoring and Reporting on Environmental compliances 則 Environmental Action Plans 則 Training on Environmental Matters 則 Training of Junior Staff 則 Quality Assurance Plan Implementation 則 Non Conformancy Reporting 則 Document / Records Control 則 Q/A Training 則 Internal Audits 則 Training of Junior Staff 則 System Wide Consultants 則 Interfacing CC Contractors 則 Detailed Design Consultants 則 Railway Operations System -足 Wide Contracts 則 Special Purchase Contractors 則 Supply-足Install Contractors 則 HKSAR Government Departments 則 Hong Kong Railway Inspectorate 則 Utility Undertakers 則 Traffic Diversions 則 Statutory Approvals, Consents and Permits 則 Training of Junior Staff 則 Managing other Managers 則 Preparation of Method Statements 則 Preparation of Materials Submissions 則 Preparation of Sub-足 Contractor Approval Submissions 則 Monthly Report to Engineer 則 Setting Out 則 Management of Contractor's Plant & Equipment 則 Heading up of Site Production Teams including Foundations, Structures, E&M and Architectural Builders Works & Finishes 則 Site Security 則 Works Programme 則 3 Month Rolling Programmes 則 Monthly Programmes 則 Other Programmes Schedules and Reports as required by Project Director / Deputy PD 則 Progress Monitoring / Reporting / Forecasting 則 Payment Milestones and Key Dates Reporting / Forcasting 則 Submission Status Scheduling 則 Integration of CIP and TRIP and other Engineer issued Programmes (if issued) into Works Programmes 則 Training of Junior Staff 則 Payment Applications 則 Measurement & Valuation of Variations 則 Final Account 則 Arrangement & Monitoring of Insurances 則 Insurance Claims 則 Sub-足Contract Tender Enquiries 則 Sub-足Contract Preparation and Administration 則 Training of Junior Staff 則 Site Administration 則 Personnel 則 Site Purchases 則 Petty Cash 則 Book Keeping 則 Stores 則 Training of Junior Staff 則 Design of Temporary Works 則 Checking of Temporary Works Design 則 Independent Checking Engineer's Design Check Certificate 則 Checking of Erection of Temporary Works 則 Independent Checking Engineer's Application of Load to Temporary Works Check Certificate 則 Checking of Removal of Load Bearing Temporary Works 則 Temporary Works Design & Checking Submissions to Engineer 則 Training of Junior Staff
  • 20. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 20 Responsible Joint Venturers Role Responsible Joint Venturer A Responsible Joint Venturer B Responsible Joint Venturers C & D Sub-足Joint Venture Agrement Sub-足Joint Venture Supervisory Board Party C Party D Sub-足Joint Venture Project Management Organisation Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Responsible Sub-足Joint Venturer C Responsible Sub-足Joint Venturer D Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Sub-足Contractors Suppliers Manufacturers Plant Hirers Consultants Other Common Services & Facilities Responsible Joint Venturer's Responsibilities
  • 21. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 21 Pre-足bid Agreement 則 Exclusivity 則 Confidentiality 則 Expenses during Tender Preparation 則 JV Leader 則 Form of JVA to be substantially as per attached specimen 則 Agreement of Tender 則 Termination
  • 22. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 22 Joint Venture Agreement 則 Should satisfy Requirements of Tender Documents 則 When does Agreement become Effective? 則 Joint and Several Liability
  • 23. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 23 Joint Venture Agreement (Contd.) 則 Identify Participants and Participation 則 Identify Management and Methods of Control 則 Decision Making & Breaking of Deadlock 則 Sign or Seal
  • 24. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 24 Common Problems 則 Battle of the Forms 則 Neutral Drafter 則 Leader or Sponsor Fee 則 What are Sponsors duties? 則 Decision Making 則 Unanimous? 則 Majority?
  • 25. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 25 Common Problems (Contd.) 則 Dispute Resolution and Applicable Law 則 Follow Main Contract? 則 Use of JV Facilitator 則 Mediation 則 Dissolution of JV 則 Finishing off outstanding matters
  • 26. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 26 Less Common Problems 則 USA 則 Foreign Corrupt Practices Act, 15 USC section 78dd-足1,2 則 Prosecutions 則 Recorded against each Joint Venturer
  • 27. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 27 Conclusion The Joint Venture is the most flexible instrument for making fits out of misfits. It will become increasingly important. It is at the same time the most demanding and difficult of all tools of diversification and the least understood. Peter Drucker, Management: Tasks Responsibilities and Practices 1974
  • 28. A Joint Venture: To Be Or Not To Be? That Is The Question 息 Steve TennantConsultancy Ltd2001 28 The End Visit our Web Site at www.stevetennant.com