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62-468: The 'Small Business Technology Transfer Act of 1992' was enacted to increase opportunities for small businesses and non profit organizations to collaborate with federal research laboratories. Agencies with a more than $ 1 billion extramural research and development budget must reserve 0.3% of their extramural research budget for Small Business Technology Transfer (STTR) awards. In parallel, in December 1992,

124-546: A special resolution of its shareholders, provided that they meet the requirements and restrictions of the Companies Acts. Such requirements tend to be more onerous for public companies than for private ones . In Hong Kong , the Companies Registry provides four samples of model Articles of Association, and they are known as Sample A, B, C, and D respectively. < Sample A and B are both designed for

186-1018: A temporary partnership for the purpose of carrying out a particular project, such partnership can also be called a joint venture where the parties are " co-venturers ". The venture can be a business JV (for example, Dow Corning), a project/asset JV intended to pursue one specific project only, or a JV aimed at defining standards or serving as an "industry utility" that provides a narrow set of services to industry participants. Some major joint ventures include United Launch Alliance , Vevo , Hulu , Virgin Media O2 , Penske Truck Leasing , and Owens-Corning . According to Gerard Baynham of Water Street Partners, there has been much negative press about joint ventures, but objective data indicate that they may actually outperform wholly owned and controlled affiliates . He writes, "A different narrative emerged from our recent analysis of U.S. Department of Commerce (DOC) data, collected from more than 20,000 entities. According to

248-416: A "memorandum of incorporation" or "MoI". The MoI gives considerably more scope to vary how to the company is governed than the previous arrangement. Articles of Incorporation are appended to a Certificate of Incorporation and become the legal document that governs the corporation. In Canada , the process of incorporation can be done either at the federal or provincial level. Companies which incorporate with

310-439: A 2.2 percent average ROA, while wholly owned and controlled affiliates in the U.S. only realized a 0.7 percent ROA." In European law , the term "joint venture" is an exclusive legal concept, better defined under the rules of company law . In France , the term "joint venture" is variously translated as "association d'entreprises", "entreprise conjointe", "coentreprise" or "entreprise commune". A JV can be brought about in

372-482: A company, or articles of incorporation , of an American or Canadian company, are often simply referred to as articles (and are often capitalized as an abbreviation for the full term). The Articles are a requirement for the establishment of a company under the law of India , the United Kingdom , Nigeria , Pakistan and many other countries. In 1955, Together with the memorandum of association , they are

434-526: A company. By its formation, the JV becomes a new entity with the implications that: On the receipt of the Certificate of Incorporation, a company can commence its business. This is a legal area and is fraught with difficulty as the laws of countries differ, particularly on the enforceability of "heads of" or shareholder agreements. For some legal reasons, it may be called a Memorandum of Understanding . It

496-419: A new market, particularly emerging market ; to gain scale efficiencies by combining assets and operations; to share risk for major investments or projects; or to access skills and capabilities. Most joint ventures are incorporated, although some, as in the oil and gas industry , are "unincorporated" joint ventures that mimic a corporate entity. With individuals, when two or more persons come together to form

558-663: A political party, and legislators could dissolve a corporation at any time relatively easily. Corporations did not have the same corporate veil of protection that are enjoyed today. The shift towards corporations gaining more power and control happened as the United States progressed towards industrialization . The American Civil War wildly enriched corporations and with this new wealth came bribes to legislators and courts that allowed for increased liability protection and other corporate protections. The 1886 Supreme Court case Santa Clara County v. Southern Pacific Railroad set

620-496: A principal disadvantage is absence of an interested and influential Chinese party. As of the 3rd Quarter of 2004, WFOEs had replaced EJVs and CJVs as follows: (*)=Financial Vventures by EJVs/CJVs (**)=Approved JVs These enterprises are formed under the Sino-Foreign Investment Act. The capital is composed of value of stock in exchange for the value of the property given to the enterprise. The liability of

682-468: A private company (the most common company type), Sample C for a public company, and Sample D for a company limited by guarantee. The Companies Act 2006 received Royal Assent on 8 November 2006 and was fully implemented on 1 October 2009. It provides a new form of Model Articles for companies incorporated in the United Kingdom. Under the new legislation, the articles of association will become

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744-426: A profit corporation range from $ 50 - $ 300, and to incorporate a nonprofit corporation range from $ 0 -$ 125. The first step in filing articles of incorporation is for the owners to decide which state to incorporate the business in. Once the state has been chosen, the documents with all the corporation's information have to be filled out, whether physically or virtually. Once completed, these documents will be reviewed by

806-403: A quorum is not met, a Third Meeting may be called and the members present, unlimited by the quorum, take all decisions. There are variations to this among companies and countries. Decisions are taken by a show of hands; the chair is always present. Where decisions are made by a show of hands is challenged, it is met by a count of votes. Voting can be taken in person or by marking the paper sent by

868-540: Is a document or charter that establishes the existence of a corporation in the United States and Canada . They generally are filed with the Secretary of State in the U.S. State where the company is incorporated, or other company registrar . An equivalent term for limited liability companies (LLCs) in the United States is articles of organization . The articles can cover a medley of topics, not all of which

930-404: Is allowed to enter into contracts with appropriate government authorities to acquire land use rights, rent buildings, and receive utility services. In this it is more similar to a CJV than an EJV. WFOEs are expected by PRC to use the most modern technologies and to export at least 50% of their production, with all of the investment is to be wholly provided by the foreign investor and the enterprise

992-604: Is described below. The EJV Law is between a Chinese partner and a foreign company. It is incorporated in both Chinese (official) and in English (with equal validity), with limited liability. Prior to China's entry into WTO – and thus the WFOEs – EJVs predominated. In the EJV mode, the partners share profits, losses, and risk in equal proportion to their respective contributions to the venture's registered capital. These escalate upwardly in

1054-470: Is done in parallel with other activities in forming a JV. Though dealt with briefly for a shareholders' agreement , some issues must be dealt with here as a preamble to the discussion that follows. There are also many issues which are not in the Articles when a company starts up or never ever present. Also, a JV may elect to stay as a JV alone in a "quasi partnership" to avoid any nonessential disclosure to

1116-414: Is generally a well-known outsider but they may be a working executive of the company, typically of an American company. The directors may, or may not, be employees of the company. In present countries there are usually a few major shareholders who come together to form the company. Each usually holds the right to nominate, without objection of the other, a certain number of Directors who become nominees for

1178-464: Is required in a country's law. Although all terms are not discussed, they may cover: A company is run by the directors, who are appointed by the shareholders. Usually, the shareholders elect a board of directors (BOD) at the annual general meeting (AGM), which may be statutory (e.g. India and the UK). The number of directors depends on the size of the company and statutory requirements. The chairperson

1240-523: Is required upon filing Articles of Incorporation in Canada: In the United Kingdom, model articles of association, known as Table A have been published since 1865. The articles of association of most companies incorporated prior to 1 October 2009 – particularly small companies – are Table A, or closely derived from it. However, a company is free to incorporate under different articles of association, or to amend its articles of association at any time by

1302-525: Is to "incentivize and enable startups and small business to undertake R&D with high technical risk and high commercial reward." This United States government–related article is a stub . You can help Misplaced Pages by expanding it . Joint venture A joint venture ( JV ) is a business entity created by two or more parties, generally characterized by shared ownership , shared returns and risks , and shared governance. Companies typically pursue joint ventures for one of four reasons: to access

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1364-470: Is what will happen if the firm is dissolved, if one of the partners dies, or if the firm is sold. Often, the most successful JVs are those with 50:50 partnership with each party having the same number of directors but rotating control over the firm, or rights to appoint the Chairperson and Vice-chair of the company. Sometimes a party may give a separate trusted person to vote in its place proxy vote of

1426-515: Is within his total control. WFOEs are typically limited liability enterprises. Like with EJVs, but the liability of the directors, managers, advisers, and suppliers depends on the rules which govern the Departments or Ministries which control product liability, worker safety or environmental protection. An advantage the WFOE enjoys over its alternates is enhanced protection of its know-how but

1488-486: The World Trade Organization (WTO) around 2001 has had profound effects on foreign investment. Not being a JV, they are considered here only in comparison or contrast. To implement WTO commitments, China publishes from time to time updated versions of its "Catalogs Investments" (affecting ventures) prohibited, restricted. The WFOE is a Chinese legal person and has to obey all Chinese laws. As such, it

1550-475: The by-laws or is a statutory requirement. It is presided over by the Chairperson , or in their absence, by the vice-chair. The Directors survey their area of responsibility. They may determine to make a 'Resolution' at the next AGM or if it is an urgent matter, at an EGM. The Directors who are the electives of one major shareholder, may present their view but this is not necessarily so - they may have to view

1612-450: The "constitution" of a company in these countries. The articles of association regulate the interaction between shareholders and the directors of a company and can be a lengthy document of up to 700,000 or so pages. It deals with the powers relegated by the stockholders to the directors and those withheld by them, requiring the passing of ordinary resolutions , special resolutions and the holding of Extraordinary General Meetings to bring

1674-459: The DOC data, foreign joint ventures of U.S. companies realized a 5.5 percent average return on assets (ROA), while those companies' wholly owned and controlled affiliates (the vast majority of which are wholly owned) realized a slightly lower 5.2 percent ROA. The same story holds true for investments by foreign companies in the U.S., but the difference is more pronounced. U.S.-based joint ventures realized

1736-640: The Founder at board meetings. Recently, in a major case the Indian Supreme Court has held that Memorandums of Understanding (whose details are not in the articles of association) are "unconstitutional" giving more transparency to undertakings. A JV is not a permanent structure. It can be dissolved when: Joint ventures are risky forms of business partnerships . Literature in business and management has paid attention to different factors of conflict and opportunism in joint ventures, in particular

1798-537: The Government of the country. For their assurance, the shareholders are permit of the Memorandum of Association. Any matter in the Articles of Association not within the scope of the Memorandum of Association of the company is void. The Board meets several times each year. At each meeting there is an ' agenda ' before it. A minimum number of Directors (a quorum ) is required to meet. This is either determined by

1860-464: The JV's life, giving the option to the foreign investor, by holding higher equity, obtains a faster rate of return with the concurrent wish of the Chinese partner of a later larger role of maintaining long-term control. The parties in any of the ventures, EJV, CJV or WFOE prepare a feasibility study outlined above. It is a non-binding document – the parties are still free to choose not to proceed with

1922-508: The Objectives of the company and competitive position. The chair may have to break the vote if there is a tie. At the AGM, the various Resolutions are put to vote. The AGM is called with a notice sent to all shareholders with a clear interval. A certain quorum of shareholders is required to meet. If the quorum requirement is not met, it is cancelled and another Meeting called. If it at that too

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1984-536: The US) covering know-how and trademarks and supply-of-equipment agreements. The minimum equity is prescribed for investment truncated, where the foreign equity and debt levels are: There are also intermediary levels. The foreign investment in the total project must be at least 25%. No minimum investment is set for the Chinese partner. The timing of investments must be mentioned in the Agreement and failure to invest in

2046-461: The cases, the status of the formed enterprise is that of a legal Chinese person which can hire labor directly as, for example, a Chinese national contactor. The minimum of the capital is registered at various levels of investment. Other differences from the EJV are to be noted: Convenience and flexibility are the characteristics of this type of investment. It is therefore easier to find co-operative partners and to reach an agreement. With changes in

2108-470: The company's shareholders. The articles of incorporation typically include the name of the corporation, the type of corporate structure (e.g. profit corporation, nonprofit corporation, benefit corporation, professional corporation), the registered agent , the number of authorized shares, the effective date, the duration (perpetual by default), and the names and signatures of the incorporators. The state fee to file articles of incorporation to incorporate

2170-428: The company. A person who is not a shareholder of the company can vote if s/he has the 'proxy', an authorization from the shareholder. Each share carries the number of votes attached to it. Some votes may be for the decision, others not. There are two types of resolutions, known as an Ordinary Resolution and a Special Resolution. A Special Resolution can be tabled at a Director's Meeting. The Ordinary Resolution requires

2232-749: The constitution of a company. The equivalent term for an LLC is articles of organization . Roughly equivalent terms operate in other countries, such as Gesellschaftsvertrag in Germany, statuts in France, statut in Poland, Ukrainian : статут ( Romanization : statut ) in Ukraine , and Jeong-gwan in South Korea . In South Africa , from the new Companies Act 2008 which commenced in 2011, articles and memoranda of association have been replaced by

2294-622: The death of Mao Zedong in 1976, initiatives in foreign trade began to be applied, and law applicable to foreign direct investment was made clear in 1979, while the first Sino-foreign equity venture took place in 2001. The corpus of the law has improved since then. Companies with foreign partners can carry out manufacturing and sales operations in China and can sell through their own sales network. Foreign-Sino companies have export rights which are not available to wholly Chinese companies, as China desires to import foreign technology by encouraging JVs and

2356-503: The directors' decision to bear. A Certificate of Incorporation or the Articles of Incorporation is a document required to form a corporation in the U.S. (in actuality, the state where it is incorporated) and in countries following the practice. In the US, the "constitution" is a single document. The Articles of Incorporation is again a regulation of the directors by the stock-holders in

2418-463: The election by the shareholder body at the AGM. Shareholders may also elect Independent Directors (from the public). The chair would be a person not associated with the promoters of the company, a person is generally a well-known outsider. Once elected, the BOD manages the company. The shareholders play no part until the next AGM/EGM. The Objectives and the purpose of the company are determined in advance by

2480-511: The endorsement by a majority vote, sometimes easily met by partners' vote. The Special Resolution requires a 60, 70 or 80% of the vote as stipulated by the constitution of the company. Shareholders other than partners may vote. The matters which require the Ordinary and Special Resolution to be passed are enumerated in company or Corporate Law. Special Resolutions covering some topics may be a statutory requirement. The articles of association of

2542-532: The federal government will generally need to register extra-provincially in the province that they elect to do business. Similarly, a provincial corporation may need to register extra-provincially if they are to have offices outside of their home province. Incorporated Canadian companies can generally use either Corp., Corporation, Inc., Incorporated, Incorporée, Limited, Limitée, Ltd., Ltée, Société par actions de régime fédéral, S.A.R.F, in their name, but this may vary from province to province. The following information

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2604-471: The following major ways: In the UK , India , and in many common law countries, a joint-venture (or else a company formed by a group of individuals) must file its memorandum of association with the appropriate authority. This is a statutory document which informs the public of its existence. It may be viewed by the public at the office in which it is filed. Together with the articles of association , it forms

2666-532: The founders of the United States had a healthy fear of corporations after being exploited for years by those in England. As a result, they limited the role of corporations by only granting select corporate charters, mainly to those that were beneficial to society as a whole. For the better part of the first one hundred years of United States history, the power of corporations was severely limited as owners could not own any stock or property, make financial donations to

2728-423: The government or the public. Some of the issues in a shareholders' agreement are: There are many features which have to be incorporated into the shareholders' agreement which is quite private to the parties as they start off. Normally, it requires noтуОЧ submission to any authority. The other basic document which must be articulated is the Articles, which is a published document and known to members. This repeats

2790-439: The important legal precedent that corporations were “natural people” and as a result were protected under the 14th Amendment . The articles of incorporation outline the governance of a corporation along with the corporate bylaws and the corporate statutes in the state where articles of incorporation are filed. To amend a corporate charter, the amendment must usually be approved by the company's board of directors and voted on by

2852-567: The indicated time, draws a penalty. Co-operative Joint Ventures (CJVs) are permitted under the Sino-Foreign Co-operative Joint Ventures. Co-operative enterprises are also called Contractual Operative Enterprises. The CJVs may have a limited structure or unlimited – therefore, there are two versions. The limited-liability version is similar to the EJVs in status of permissions – the foreign investor provides

2914-539: The influence of parent control structure, ownership change, and volatile environment. Government procurement regulations, such as the Federal Acquisition Regulation (FAR) in the United States, may specify how joint ventures are to be approached as suppliers or confirm that a joint venture or other form of contractor partnering is seen as a "desirable" arrangement for supplying to government. The FAR states that The Government will recognize

2976-405: The integrity and validity of contractor team arrangements [including joint ventures], provided the arrangements are identified and company relationships are fully disclosed in an offer or, for arrangements entered into after submission of an offer, before the arrangement becomes effective. The Government will not normally require or encourage the dissolution of contractor team arrangements. Under

3038-719: The latest technologies. Under Chinese law, foreign enterprises are divided into several basic categories. Of these, five will be described or mentioned here: three relate to industry and services and two as vehicles for foreign investment. Those five categories of Chinese foreign enterprises are: the Sino-Foreign Equity Joint Ventures (EJVs), Sino-Foreign Co-operative Joint Ventures (CJVs), Wholly Foreign-Owned Enterprises (WFOE), although they do not strictly belong to Joint Ventures, plus foreign investment companies limited by shares (FICLBS), and Investment Companies through Foreign Investors (ICFI). Each category

3100-480: The law, it becomes possible to merge with a Chinese company for a quick start. A foreign investor does not need to set up a new corporation in China. Instead, the investor uses the Chinese partner's business license, under a contractual arrangement. However, under the CJV, the land stays in the possession of the Chinese partner. There is another advantage: the percentage of the CJV owned by each partner can change throughout

3162-402: The majority of funds and technology and the Chinese party provides land, buildings, equipment, etc. However, there are no minimum limits on the foreign partner which allows him to be a minority shareholder. The other format of the CJV is similar to a partnership where the parties jointly incur unlimited liability for the debts of the enterprise with no separate legal person being created. In both

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3224-474: The project. The feasibility study must cover the fundamental technical and commercial aspects of the project, before the parties can proceed to formalize the necessary legal documentation. The study should contain details referred to earlier under Feasibility Study (submissions by the Chinese partner). There is basic law of the PRC concerning enterprises with sole foreign investment controls, WFOEs. China's entry into

3286-564: The related 'Small Business Research and Development Enhancement Act' (P.L. 102-564) was passed to reauthorize the Small Business Innovation Research (SBIR) program for joint ventures until September 30, 2000. The 'Small Business Reauthorization Act of 2000' (P.L. 106-554) reauthorized the program until September 30, 2008. Numerous extensions passed with the most recent one extending the SBIR program through 2022. It

3348-410: The responsibilities of the directors , the kind of business to be undertaken, and the means by which the shareholders exert control over the board of directors. Articles of association are critical documents to corporate operations, as they may regulate both internal and external affairs. Articles of incorporation , also referred to as the certificate of incorporation or the corporate charter ,

3410-549: The rules applicable to public procurement in the European Union , public bodies may insist that suppliers intending to provide goods and services through a joint partnership accept joint liability for the execution of the contract. According to a 2003 report of the United Nations Conference on Trade and Development , China was the recipient of US$ 53.5 billion in direct foreign investment, making it

3472-440: The same proportion as the increase in registered capital. The JV contract accompanied by the articles of association for the EJV are the two most fundamental legal documents of the project. The Articles mirror many of the provisions of the JV contract. In case of conflict the JV document has precedence. These documents are prepared at the same time as the feasibility report. There are also the ancillary documents (termed "offsets" in

3534-514: The secretary of state's office, and upon approval from the state government and payment of a filing fee, the company has officially become a legal corporation. The following information is required upon filing Articles of Incorporation in the United States: Many corporations file in the state in which they are doing business, although this is not required by law. Corporations doing business in multiple states often file articles in

3596-435: The shareholders agreement as to the number of directors each founder can appoint to the board of directors; whether the board controls or the founders; the taking of decisions by simple majority (50%+1) of those present or a 51% or 75% majority with all directors present (their alternates/ proxy ); the deployment of funds of the firm; extent of debt; the proportion of profit that can be declared as dividends; etc. Also significant

3658-407: The shareholders and the Memorandum of Association (MOA), if separate, which denotes the name of the company, its Head-Office, street address, and (founding) Directors and the main purposes of the company for public access. It cannot be changed except at an AGM or Extraordinary General Meeting (EGM) and statutory allowance. The MOA is generally filed with a Registrar of Companies who is an appointee of

3720-404: The shareholders, including debt, is equal to the number of shares purchased by each partner. Articles of association In corporate governance , a company's articles of association ( AoA , called articles of incorporation in some jurisdictions) is a document that, along with the memorandum of association (in cases where it exists) forms the company's constitution . The AoA defines

3782-475: The single constitutional document for a UK company, and will subsume the majority of the role previously filled by the separate memorandum of association. The use of model articles for companies is not compulsory. If custom articles of associations are not registered, the relevant model articles apply by default from incorporation. After fighting the American Revolution with Great Britain ,

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3844-426: The world's largest recipient of direct foreign investment for the first time, to exceed the US. Also, it approved the establishment of nearly 500,000 foreign-investment enterprises. The US had 45,000 projects by 2004 with an in-place investment of over 48 billion. Until recently, no guidelines existed on how foreign investment was to be handled due to the restrictive nature of China toward foreign investors. Following

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