Joint Venture

Definition of Joint Venture

A Joint Venture is a legal entity created by two or more businesses joining together to conduct a specific business enterprise with both parties sharing profits and losses.
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There must be a legal entity. If there is no legal entity for the joint venture, the partnership is simply a strategic alliance, rather than a joint venture.

In a joint venture, both firms share in the efforts and in the profits or loss. The requirements of each firm are outlined in a joint venture agreement.