How to review a joint venture agreement

A joint venture brings two or more businesses together for a shared project while they stay independent. It can be purely contractual or run through a new entity, usually an LLC. Either way, the agreement has to deal with money, control, IP, competition between the partners and, above all, how the venture ends. This checklist covers what to check and how to review the documents in Word with LexDraft.

Last checked: 17 October 2026. The law changes; check the current position before relying on this page.

Structure first

• Contractual or entity joint venture. A contractual JV (sometimes called a strategic alliance) keeps each party's assets separate. An entity JV creates a new company, and the JV agreement usually sits alongside its operating agreement or bylaws. Check that the documents do not conflict.
• Tax. An LLC joint venture with two or more members is usually taxed as a partnership unless it elects otherwise. Allocations and distributions should be reviewed with tax advisers.

Clause checklist

• Purpose and scope. Define the business of the JV narrowly. The scope drives exclusivity, non-compete and corporate opportunity clauses.
• Contributions. Cash, assets, IP or services, how each is valued, and what happens if a party fails to contribute.
• Further funding. Capital calls, dilution for non-funding parties, and third-party debt.
• Governance. Board or manager appointments, voting, and a list of reserved matters needing unanimous approval.
• Deadlock. Escalation to senior executives, mediation, buy-sell mechanisms, or dissolution.
• Fiduciary duties. In a Delaware LLC, the operating agreement can restrict or eliminate fiduciary duties, but not the implied contractual covenant of good faith and fair dealing (6 Del. C. section 18-1101(c)). State clearly what duties the partners and their appointees owe.
• Corporate opportunities and non-compete. Can the partners compete with the JV? If the JV is a Delaware corporation, section 122(17) of the Delaware General Corporation Law allows it to renounce interests in specified business opportunities.
• Competition law. Collaborations between competitors are tested under the antitrust laws. Limit restrictions to what the venture reasonably needs, and control information flows between competing parents. The FTC and DOJ withdrew their 2000 Competitor Collaboration Guidelines in December 2024, so there is no current agency safe harbor to point to.
• Merger control and foreign investment. Forming a JV corporation or LLC can require a Hart-Scott-Rodino filing if the size thresholds are met, and a foreign partner may raise CFIUS questions. Check the current thresholds and rules.
• Intellectual property. Background IP licensed in, ownership of IP the JV develops, and licenses back to the parents, including what survives exit.
• Transfers and exit. Lock-ups, rights of first refusal, tag and drag rights, put and call options, change-of-control triggers, and the valuation method on exit.
• Termination and wind-up. Events that end the JV, distribution of assets, and continuing obligations.
• Dispute resolution. Arbitration is common in cross-border JVs. Make the deadlock and dispute clauses work together.

A joint venture agreement review workflow in Word

LexDraft is a Word add-in from Microsoft AppSource. It opens as a side panel in Word 365 (Windows and Mac), Word 2021 and Word on the web, so the agreement never leaves the tool you already draft in.

1. Open the agreement in Word and open LexDraft in the side panel.
2. Pick the governing law. Select the state named in the governing law clause so LexDraft looks for state-specific red flags.
3. Run the review. LexDraft has four built-in playbooks (NDA, SaaS MSA, DPA and services agreement) and no dedicated joint venture agreement playbook, so this runs as a general review against the governing law you chose. Use the checklist on this page to direct your own read.
4. Triage by severity. Findings are graded Critical, High, Medium or Low, and LexDraft flags standard terms that are missing.
5. Run the quick checks. The defined-term and cross-reference checks are rule-based and run without AI.
6. Accept or reject each redline. Accepted changes land as native Word tracked changes.
7. Verify and sign off. You check every output before it goes to the client or the other side.

What LexDraft does not do

LexDraft does not give legal, tax or antitrust advice or decide whether a filing is needed. Nothing changes in your document until you accept a redline.

This guide is general information, not legal advice. LexDraft does not give legal advice; qualified counsel must review every draft. Spotted something out of date? Email support@lexdraft.ai and we will fix it.