What is a Joint Venture Agreement

A joint venture agreement is a legally binding contract between two or more parties who agree to work together on a specific commercial project or business objective. Rather than merging entirely, each party remains a separate entity but collaborates by pooling resources, expertise or capital to pursue shared goals.

The agreement sets out the terms of the collaboration, including each party’s contributions, rights and responsibilities, how profits and risks are shared, management and decision-making arrangements, and what happens if the venture ends or disputes arise. These agreements help provide certainty and protect each party’s interests, whether the venture operates under a simple contractual arrangement or through a jointly owned company or partnership. This helps avoid misunderstandings and protects everyone involved if circumstances change.