What Is a Joint Venture
A joint venture (JV) is a business collaboration between two or more entities pursuing a common goal. Polish law doesn't separately regulate JVs — they can take the form of a contractual JV or an equity JV (special purpose company, typically a sp. z o.o.).
Contractual JV vs. Equity JV
Contractual JV — agreement governs cooperation without creating a separate entity. Flexible, but weaker protection. Equity JV — parties establish a joint company. Clearer rules, limited liability, easier IP and asset management.
Key JV Agreement Provisions
- Purpose — precise project description, milestones, success criteria
- Contributions — financial, in-kind, IP, know-how, personnel
- Profit and loss sharing — proportional to contributions or otherwise agreed
- Management and decisions — who decides, unanimity matters, deadlock resolution
- Non-compete restrictions — whether partners may engage in competing activities
- Exit mechanisms — put/call options, tag-along/drag-along, pre-emptive rights
Intellectual Property Protection
Who contributes IP, who owns IP created within the JV, usage rules after dissolution. Without clear regulation — IP disputes can destroy the entire venture.
Deadlock — Breaking the Impasse
Mechanisms: mediation/arbitration, escalation to partner boards, buy-sell provisions (shotgun clause), limited veto rights, casting vote for one partner on specific issues.
Exit and JV Dissolution
Triggers: goal achievement, time expiry, change of control over a partner, material breach, insolvency. Consequences: asset division, ongoing IP licenses, post-exit non-compete, third-party obligations.
Planning a joint venture? Get in touch — I'll prepare a JV agreement protecting both parties' interests.