Private, Public and Global Enterprises
- A joint venture covered under automatic route needs to obtain approval of the Reserve Bank of India
- In other special cases where it is not covered under the automatic route, a special approval of FIPB (Foreign Investment Promotion Board) is mandatory. In a joint venture, a memorandum of understanding should be signed by both the parties highlighting the basis of a joint venture agreement. The terms have to be carefully discussed and negotiated to avoid legal complications in future. Negotiations and terms must be taken into account based on the cultural and legal background of the parties. The joint venture agreement should also clearly state that all necessary governmental approvals and licenses shall be obtained within the stipulated time.