Although you may refer to working together with another business or professional as a partnership, it may be a joint venture under New York law. For legal purposes, you need to know what type of business activity you’re engaging in.
New York business law defines a joint venture as two or more entities coming together to for a single business enterprise. All involved entities must share the profits and losses of their project. Each party also has control over the joint venture. You can write a joint venture agreement to outline the terms of the project. This helps prevent conflict.
Key issues to clarify include:
- Length of the venture
- Intellectual property
- Financial contributions of each entity
- Structure and management
- Each entity’s goals and the shared goal
A partnership is two or more individuals operating a business together. Types of partnerships in New York include a general partnership (GP), limited partnership (LP) and limited liability partnership (LLP). Members of a partnership agree to share the profits, losses and responsibilities of the business.
Similar to a joint venture, you can create a partnership agreement. This document outlines the terms and conditions of the partnership to help protect each partner. If one person fails to fulfill their responsibilities, then you could seek compensation.
To form a partnership in New York, you need to submit the relevant paperwork and a fee for the type of partnership. LPs and LLPs must then notify the public that they have started a partnership. They also need to file an Affidavit of Publication and a Certificate of Publication along with the required fee. All partnerships must get an EIN (employer identification number) and sales tax number.
Joint ventures are a type of partnership, but they typically dissolve after a certain time period. A joint venture is when two entities partner for a project rather than operating the same business. Whether you have a partnership or a joint venture, New York has legal protections in place.