Joint Ventures in Russia are typically thought of by most people, including those in the legal profession as oil and gas ventures of one sort or another; however, joint ventures are formed in many more sectors. Why is it that joint ventures tend to be popular among clients and attorneys alike, especially when a foreign company is trying to break into a foreign market? Many businesses see this sort of corporate form as safer than the risk of opening a branch office in a country in which they have no presence and experience doing business.
The fact that a foreign company has no contacts within the foreign market makes it clear that there is one essential element that must not be ignored: the relationship between the partners in a joint venture. Perhaps such a statement seems trite and overused in business law, of course the partners need to have a relationship, but the question becomes one of whether that relationship actually makes sense or does the relationship exist solely for the creation of the joint venture. If the relationship exists between the partners simply to create a joint venture and those partners have nothing in common absent the joint venture there are serious questions as to what the joint venture will yield for either party.
However, once the decision has been made to create a joint venture the counsel for the partners have little choice but to form that joint venture, or find alternative work. The following is meant to assist counsel in forming a joint venture in Russia; however this paper is only a short practice guide, designed to give counsel a general understanding of joint ventures in Russia. This guide should not be used alone, without any further resources; some good ones are to be found in the following footnotes. Read entire paper in the pdf.