Issue Date: 
Thursday, January 31, 2019

8 things you must know about Joint Ventures

By Werner van Rooyen

31 January 2019

One of the most popular types of business arrangements that are being used by South Africans, in the Tender environment, is Joint Ventures.

There are eight things that you must know about Joint Ventures:

  1. Definition

A Joint Venture is a strategic cooperation where two or more people and/or companies agree to contribute goods, services and/or capital to a common commercial enterprise for the purpose of a specific tender or request for proposal.

  1. Difference between a Joint Venture and a Private Company

The moment two or more people and/or companies come together; to do business together it can be construed of being a Joint Venture. But once these parties to this business register a formal private company then it is no longer a Joint Venture.

  1. Difference between a Joint Venture and a Partnership

A Joint Venture often sounds much like a Partnership but the main difference between a Joint Venture and a Partnership is that the members of a Joint Venture have come together for a specific Tender or Request for Proposal, while a Partnership is usually formed between two or more people to run a business for an unlimited period of time.

  1. Share expenses

Each member of a Joint Venture only share the expenses of the specific Tender for which the Joint Venture was established.

  1. Income Tax

Each member of a Joint Venture is liable for their own Income Tax. If the Joint Venture is profitable the net income of the Joint Venture will be distributed to each member of the Joint Venture according to their percentage contribution towards the Joint Venture. The members will then be tax in their individual capacity or if the member of the Joint Venture is company, then the gains of the Joint Venture will form part of the income of the company and will be taxed according to company tax legislation.

  1. Ownership

Very important to realize is that each member of the Joint Venture retains ownership of their own personal fixed assets as well as their current assets.

  1. Bank account

It is important to open a separate bank account for the Joint Venture. You do not want your private funds to get entangled with the funds of the Joint Venture.

  1. Set of accounts

Always keep a separate set of accounts for the Joint Venture. You don’t want the Joint Venture transactions to get mixed up with your own transactions or those of your company.

So remember, before you dismiss a Tender or Request for Proposal as undoable, think of teaming up with other businesses and/or people in the form of Joint Venture and bid through the Joint Venture.

To learn more about this and many other tender conditions attend our “Become a Tender Expert” 2-Day workshops presented in Johannesburg, Pretoria, Durban, Port Elizabeth and Cape Town. Book and pay online at www.howtotender.co.za. Please contact Estelle at Estelle@howtotender.co.za should you require more information.

This article was written by Werner van Rooyen, Director of HowToTender (Pty) Ltd which specializes in tender consulting and tender training.

Title Closing Date Tender No.
Routine maintenance of the municipal ICT infrastructure & support provision as and when required for a period of 36 months (3 years). 2019-08-19 11:00 No reference number
Appointment of a panel of maximum 8 contractors for civil engineering works for a period of 36 months, on as and when required basis 2019-08-21 11:00 No reference number
Appointment of a panel of maximum 8 contractors for civil engineering works for a period of 36 months, on as and when required basis. 2019-08-22 11:00 No reference number
Consultancy Services On Integrated Monitoring And Evaluation Of Implementation Of Sharm El-Sheikh Commitments And Africa Water Vision 2025 Based On The Integrated Water Resources Management (IWRM) 2019-08-01 15:00 AUC/DREAC/066
Consultancy services for SAP bank communication management 2019-08-02 15:00 No reference number
Lease of The Hartenbos Sports Grounds 2019-07-19 12:00 117-18/19
Provision of Software Application for a Land Use Management System (Property Register, Valuations and Zoning Register) And Support Services 2019-07-26 12:00 114-18/19
Hire of Portable Chemical Flush Toilets 2019-08-02 12:00 121-18/19
Managing and Demolishing of informal Settlements within the Mossel Bay area 2019-08-02 12:00 123-18/19
Supply, delivery, fitment and balancing of tyres 2019-08-08 12:00 TDR-5/2019
Removal Of Sewer Sludge 2019-08-08 12:00 TDR-6/2019
Lease of Steel Containers For Beehive Purposes 2019-08-16 12:00 122-18/19
Sale, collect and remove of scrap metal at Wellington Waste Water Treatment. 2019-08-01 10:00 WEB 15: 2019/2020
Cleaning of Planning and Customer Services at Jan van Riebeeck Weg 15 (unit 6) for the period up to 31 December 2019. 2019-08-01 10:00 WEB 14: 2019/2020
Safe handling, collection, transportation and disposal of asbestos for the period up to 30 June 2020. 2019-08-01 10:00 WEB 13: 2019/2020
Pauper funerals in Drakenstein Area from August 2019 till 31 December 2019. 2019-08-01 10:00 WEB 3: 2019/2020 (Readvertise)
Appointment of a panel of a maximum 8 contractors for sanitation works for a period of 36 months, on as and when required basis 2019-08-22 11:00 No reference number
Supply & delivery of air conditioners in the Drakenstein Municipal Area for a period up to 30 June. 2019-08-01 10:00 WEB 12: 2019/2020
Supply & delivery of wooden bitumen poles for HT lines for a period up to 30 June 2020. 2019-08-01 10:00 WEB 11: 2019/2020
Tenders are invited for the Civil Designer Software Training as per Specifications available at SCM: Acquisitions, Harrower Road, Port Elizabeth, 2019-07-19 11:00 CSQ07191667

Pages

Extension of validity period

By Werner van Rooyen

www.howtotender.co.za

31 January 2019

Those of you who are familiar with responding to tenders will know that it is common practice for procuring entities to extend the bid price validity period. We received the undermentioned queries regarding the extension of the validity period of the bid price.

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