Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Equity definition

What does Equity mean? In corporate finance practice, equity means the risk-bearing capital provided by a company’s owners, usually through ordinary shares, as distinct from debt finance. Equity holders have the residual interest in profits and assets: returns are by dividend or capital growth, and they rank behind all creditors on insolvency. Equity commonly carries voting and control rights and is subject to company law capital maintenance and distribution rules (for example, dividends only out of distributable profits and statutory pre-emption on new share issues unless disapplied). It is central to capital structure, M&A, venture capital and private equity transactions. Practitioners also describe certain...

UK joint ventures: implications for non-tax advantaged employee share schemes under CA 2006, FSMA, public offers/prospectus, financial assistance, TUPE, transfer pricing and shareholder approval

Published by a LexisNexis Share Incentives expert

Practice notes

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What is a joint venture?

A joint venture (JV) is a business arrangement between two or more separate parties under which each agrees, typically for a limited period, to create a new vehicle by putting in Equity or other assets. In this Practice Note, that new vehicle is called the joint venture company (JVCo). Control of the JVCo is exercised by the parties, who therefore usually divide income, costs and Ownership. JVs can be structured in different ways. For instance, it may run through a distinct JV vehicle, most often a Limited Liability company or a partnership. Alternatively, in its simplest form it is merely a pact between the participants, the JV parties (JVPs), in which no separate legal person is formed and the association rests purely on contract. For further, more general information on JVs, see Practice Note: Setting up a corporate joint venture—initial considerations. This Practice Note focuses solely on how a JV can impact general share incentive matters outside the statutory tax-advantaged share Plans...

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Web page updated on 22/05/2026

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