Since the contractual joint venture is not a separate legal entity, but only the assembly of several independent companies, it will generally be tax-transparent. As a general rule, no separate tax registration is required, but each member of the contractual joint venture must fulfil its own tax obligations[21]. The registered joint venture requires numerous formalities, including legalised and translated documents from the foreign shareholder(s), the drawing up of a shareholders` agreement, the preparation and official signature of company articles[13] and the obtaining of various licences to be provided by the competent authorities[14]. Contractual joint ventures are very often used in the oil and gas sector (EPC, project development or joint operation agreements), construction & infrastructure (design and construction agreements), but also consulting services (such as the management of large events or transaction consulting) [4]. First, for large projects, it is not uncommon for different forms of contractual joint ventures to be superimposed: for example, a UJV may enter into a consortium contract between several contractors with a vehicle supplier, as was the case for one of the Riyadh metro lines. A consortium agreement focuses on defining the workload of each member and the interface obligations between them, usually through a responsibility matrix, so that all members cooperate effectively to deliver the final product expected by their client. In conclusion, joint venture and consortium agreements may seem relatively easy to manage, but they may be more demanding than they seem. In particular for major projects, it may be useful to conduct a detailed review of certain clauses; A customer may find that some specific clauses can be developed on the basis of best practices that are not necessarily present in the model that he can use regularly. These governance provisions are essential, as they also determine whether and how profits can be consolidated. A specific accounting standard, IFRS 11, establishes principles for financial reporting and consolidation of companies that have an interest in entering into “joint agreements” such as a UJV or a consortium agreement[23].

Since a joint venture contractual structure can be used in many different sectors and situations, the contractual joint venture agreement is quite general and does not specify how the project is carried out. It simply provides for the appointment of a management committee with one or more representatives from each of the two parties to manage the project, and then the appointment of a project manager who will lead the project on a day-to-day basis. [27] Whether the joint venture is a UJV or a consortium, although it seems more logical on paper that each member of the consortium is only responsible for its own room for manoeuvre vis-à-vis the employer, given that, unlike a joint venture situation, there is not a single volume of work. It should be noted that subsection 1.14 of the FIDIC Yellow Book establishes a principle of joint and several liability of the contractor vis-à-vis the employer when the contract is a joint venture defined as “a joint venture, association, consortium or other non-legally competent groupings of two or more persons, whether in the form of a partnership or otherwise”.