According to the terms of the partnership, the risks and rewards are part in it, which always processed through the share by the individuals (Vivoda, 2017).
The liability in the partnership is the common terms where the partners are bound to holds the liabilities jointly in the partnership business. Under the liability of the partners the obligations of paying debts in the partnership business also holds the responsibilities for an unlimited extent. For any damages or loss which cause from any wrongful omissions or illegal activities by the partners where the actual potential liabilities applicable for the third party.
Under the terms of partnership, every partner in the partnership business has the rights to share equally the profits and losses. There are also some exceptions in this matter if the terms are not mentioned in the partnership agreements. The share of the profits and losses always depend on the partners according to their partners.
Decision Making Process
According to the terms of the partnership, all the partners have equal rights to take decision, which are related with their partnership business. The rights of decision making process is not applicable for dormant partners.
The ownership in the partnership has described the terms where the assets of the business always shared between the partners for running a partnership business. The assets, which are solely, belongs to any partners the share of the profits and loss only depends according to it.
The flexibility defines the frameworks or the process where it distributed the freedom in the partnership where the business must provided with financed and control as a sole proprietorship.
The privacy is another important part in the partnership, which describes the constitutional and financial matters where it keeps all the details completely private and confidential. For any disclosure of the privacy in the partnership, it only applicable according to the interest of the partners.
The taxation is the part of any business, which is, runs by individually or by the partners. The partners are bound to pay tax for the partnership business only. They are not require to pay individually for the business.
According to the terms of the partnership, it is never applicable for the purpose of one or two projects, which are not process for the long-term business.
The partnership only comes to end if the partners dissolute the business mutually or death of any partner.
The joint venture is defines the aim to carry the business where it helps in the specific project and it only become end when the purpose has applied in the business. The joint venture also defines as a partnership without a name or running firm business. It is a special kind of partnership without a firm name. Under the joint venture it only concern about the accounting concept where it was not followed by the joint ventures. The parties to a joint venture are called co-ventures. Under this partnership, it defines the form of temporary business activity. In this process of partnership, the profits and losses always distributed in a proper agreed proportion where it will not distributed in equally. It is an agreement for where the for poling business abilities and capital to make profit in the business.
Legislations governing partnership and Joint venture in Australia
There are legislation which given partnership in Australia. However, Joint ventures do not have any specific law and are governed by common law such as Contract law, Negligence and Agency Law.
Partnership Act 1963
New South Wales
Partnership Act 1892
Partnership Act 1891
Partnership Act 1891
Partnership Act 1891
Partnership Act 1895
Partnership Act 1958
Partnership Act 1997
The Difference between partnership and Joint Venture
The joint venture is defines the aim to carry the business where it helps in the specific project and it only become end when the purpose has applied in the business. The joint venture also defines as a partnership without a name or running firm business. It is a special kind of partnership without a firm name (Haynes et al. 2016).
The partnership is defines where a business only runs through the partners with a registered business and it only omitted for the death of the partner. The Joint venture is also end under some specific purposes and the venture can be vanished.
According to the case study, for choosing a business structure under Australia it is necessary to follow the legislations. Therefore, it is important to looks for the structure and requirements of the business whether it has processed under the joint venture and partnership. It has been if Xiaojing, Lance and Nick want to work together to running an herbal product business. This is a form of business which will be continued in the long run. Therefore, the structure required for carrying out the business activity has to be in accordance to the business needs. According to the definition of joint venture and partnership, it helps to identified that partnership is a better form of unincorporated business as it always compared with a joint venture for carrying out long-term business operations. According to ---- people or organization that carries out joint ventures usually has the purpose of property developments, transportation agreements, mining syndicates or publishing agreements. These activities are applicable for a short-term period. Now it can be stated that partnership is the best possible unincorporated business structure for the herbal product business as it would only be successful in the long-run.
In a partnership, the partners would be more responsible for the controlling and managing of the business and not only takes care of their own functional areas but also the operational areas in the business where the partners would directly affected by it. It can make the conflicts that a joint venture has ability to provide the parties advantages in relation to tax benefits. However, a partnership business always helps to give the scope for significant expansion and the tax implications are to an extent, which may persuade selecting joint venture as a form of business (Vivoda, 2017).
The courts do not assess whether a business is a joint venture or a partnership based upon the name, which has provided to it but based on the features of the business. Here it is clear that the business is to be carried out on permanent purposes and not temporary purposes by the three individuals. The structure of partnership would also allow the partners to have significant control of the business and change the structure to an incorporated company in the future. In addition it has been provided by ---- that in joint venture although functions are sorted out the commitment of the co-ventures are not as much as that in a partnership business. Therefore, it is advised to Xiaojing, Lance and Nick to carry on the herbal product business in form of a partnership.
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