Joint Venture (JV) structuring is one of the most complex and strategically important processes in corporate law. In Georgia, where foreign investment often requires collaboration with a local partner (whether for land ownership, local market knowledge, or licenses), creating the right legal framework for a JV is critical. This is not just about registering a new LLC; it involves combining the interests, resources, and risks of two or more independent parties to achieve a common goal. Improperly structured joint ventures often fail due to "deadlock situations," ambiguity in management rights, and disagreements over profit distribution. Experts represented on the Legal.ge platform help you create a JV structure that ensures a balance between parties, protects minority partner rights, and clearly defines exit strategies.
What Does JV Structuring Service Cover?
Our lawyers offer a comprehensive approach to JV formation, which includes:
- Choosing Legal Form: Deciding whether to create a new legal entity (Corporate JV - typically an LLC or JSC) or regulate the relationship contractually (Contractual JV), considering the "Law on Entrepreneurs."
- Drafting Shareholders' Agreement (SHA): A document detailing the staffing of management bodies, veto rights, dividend policy, and additional funding obligations.
- Valuation and Registration of Contributions: Establishing mechanisms for valuing monetary and non-monetary (land, IP, technology) contributions and rules for reflecting them in capital.
- Deadlock Resolution Mechanisms: Pre-defined scenarios (e.g., Russian Roulette, Texas Shootout) to ensure partner disagreements do not halt the business.
- Exit Strategies: Rights to sell shares, including Right of First Refusal, Tag-along, and Drag-along rights.
Real-World Scenarios When You Need This Service
JV structuring is essential for the following types of projects:
- Real Estate Development: When one party owns the land and the other (developer) provides construction financing and management. Precise allocation of built areas is required.
- Energy Projects: Construction of HPPs or wind farms, often combining a foreign investor and a local company holding the licenses.
- Technology Transfer: When a foreign company brings technology, and a local partner provides distribution networks and marketing.
- Tender Participation: Creating a consortium to participate in state procurement, where parties combine experience and financial metrics.