NPR - POTENTIAL BUSINESS FORMS FOR AGRICULTURAL JOINT VENTURES
Joint venture agreements continue to grow in popularity as farmers look for ways to gain efficiencies, integrate horizontally or vertically within their sector, or take advantage of opportunities they otherwise could not access on their own. While joint ventures can create a number of advantages, they should be carefully planned in advance and entered into under the framework of a formal agreement. Those agreements can take the form of contractual arrangements, partnerships, or a number of limited liability entity forms. This article presents some of the considerations farmers and agribusinesses should evaluate in selecting a joint venture form, and provides an outline of the factors joint venture members should address in their agreement, including the joint venture’s scope, formation, membership, management, “buy-sell” triggers and mechanisms, policies and procedures, and termination issues.
Keywords: Joint venture, partnership, limited liability company, corporation, taxation