When you bring two entities together to operate jointly, there are several difficult issues to analyze. For the US company operating under the FCPA, there must be an adequate business justification for a joint venture with a specific partner, all in writing and approved by an appropriate level of the organization. Mike Volkov has noted this is where the due diligence process comes into play. The due diligence process should be built on principles like those involving third parties. The procedure should be robust, documented and See more +
When you bring two entities together to operate jointly, there are several difficult issues to analyze. For the US company operating under the FCPA, there must be an adequate business justification for a joint venture with a specific partner, all in writing and approved by an appropriate level of the organization. Mike Volkov has noted this is where the due diligence process comes into play. The due diligence process should be built on principles like those involving third parties. The procedure should be robust, documented and address all potential risks involved. A company should use its due diligence review of the JV partner to proper assess and uncover any corruption risk. Using this due diligence and its evaluation, you can then move to contractual clauses, certifications, representations and warranties from a JV partner or insist on other remedial measures to minimize its risk exposure.
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