What is joint venture ?

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C.A SHASHANK GOYAL (Querist)
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28 September 2011 Sir , can you please tell me what is joint venture actually is , what is the purpose of its formation .

RAMESH KUMAR VERMA

RAMESH KUMAR VERMA (Expert)
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28 September 2011 Joint Venture companies are the most preferred form of corporate entities for Doing Business in India. There are no separate laws for joint ventures in India. The companies incorporated in India, even with up to 100% foreign equity, are treated the same as domestic companies. A Joint Venture may be any of the business entities available in India

Joint Venture is where:

1.Two parties, (individuals or companies), incorporate a company in India. Business of one party is transferred to the company and as consideration for such transfer, shares are issued by the company and subscribed by that party. The other party subscribes for the shares in cash.

2.The above two parties subscribe to the shares of the joint venture company in agreed proportion, in cash, and start a new business.

3. Promoter shareholder of an existing Indian company and a third party, who/which may be individual/company, one of them non-resident or both residents, collaborate to jointly carry on the business of that company and its shares are taken by the said third party through payment in cash.

please noted :

All the joint ventures in India require governmental approvals, if a foreign partner or an NRI or PIO partner is involved. The approval can be obtained from either from RBI or FIPB. In case, a joint venture is covered under automatic route, then the approval of Reserve bank of India is required. In other special cases, not covered under the automatic route, a special approval of FIPB is required.

for more information:

https://www.sethassociates.com/setting_up_a_joint_venture_in_india.php

RAMESH KUMAR VERMA

RAMESH KUMAR VERMA (Expert)
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28 September 2011 another link is:

https://en.wikipedia.org/wiki/Joint_venture

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