Do I Need A Joint Venture Or Collaboration Agreement?

Usually, yes - if you're partnering with another business on a project, campaign or product, you'll want something in writing. The real question is what type of document fits the relationship.

A light-touch MOU might be enough while you're testing the idea. A collaboration agreement may suit a short campaign or shared client project. A joint venture agreement usually fits when both sides are putting in more money, time, people or intellectual property and sharing the upside.

This doesn't have to be complicated. The trick is matching the document to the level of risk and commitment, rather than picking the most formal-sounding option.

Do I Need A Joint Venture Agreement Or A Collaboration Agreement?

It depends on how committed you're to the project and how much risk your business is taking on.

A collaboration agreement is often right when you and another business are working together on a defined activity, such as a marketing campaign, client project, content series, product bundle or event. You might stay independent, invoice separately and only share limited responsibilities.

A joint venture agreement is usually better when the arrangement feels more like a shared business project. For example, you might both contribute funding, staff, confidential information, customer relationships or intellectual property, then share profits or losses from the project.

Think about it this way:

• Low commitment: you're exploring an idea and don't want to be locked in yet.
• Medium commitment: you're running a specific project together, but each business remains clearly separate.
• High commitment: you're building, investing in or operating something together over a longer period.

For many New Zealand businesses, the wrong document causes practical problems rather than legal drama. If your agreement is too vague, you may struggle to prove who owns the work, who gets paid first, who talks to the client, or who is responsible if something goes wrong.

If your arrangement involves shared revenue, shared costs, exclusivity, brand use, personal information, contractors or valuable IP, it's usually worth getting a tailored agreement before work starts.

When Is An MOU Enough?

An MOU can be enough when you're still exploring the relationship and you mainly want to record the plan so everyone is on the same page.

An MOU, or memorandum of understanding, is commonly used before the parties are ready to sign a more detailed contract. It can be helpful where you're scoping a project, applying for funding, pitching a client together or testing whether the relationship has legs.

Your MOU should make clear which parts are intended to be binding and which parts are not. For example, you might want the commercial proposal to be non-binding, but still make confidentiality, privacy and IP restrictions binding from day one.

An MOU may suit you if:

• you're still discussing the project details
• neither side has committed serious money yet
• you want a simple record of who will do what during the planning stage
• you need confidentiality while sharing pricing, customer lists, product ideas or designs
• you expect to replace the MOU with a more detailed agreement later

An MOU is usually not enough once money is being spent, products are being launched, customers are being served or IP is being created. At that point, you need clearer terms around payment, risk, ownership and exit rights.

For example, if you share customer data while testing a pilot, the Privacy Act 2020 still matters. You'll need to think about why you're collecting personal information, who can access it, how it will be stored, and whether your privacy policies cover the arrangement.

When Should I Use A Collaboration Agreement?

You should use a collaboration agreement when you and another business are working together on a defined project, but you don't want to create a deeper joint venture structure.

This is common for service businesses, agencies, consultants, creatives, educators, health and wellness brands, software businesses and eCommerce operators. The collaboration might be temporary, recurring or project-based.

A collaboration agreement can cover arrangements such as:

• a marketing agency and videographer delivering a client campaign together
• two online educators creating a paid webinar series
• a food brand and gym running a shared promotion
• a software company and consultant co-delivering implementation services
• two product brands creating a limited co-branded bundle

Say Kiri runs a skincare brand in Wellington and teams up with a local wellness studio for a four-week campaign. Kiri contributes 500 sample packs worth $3 each, the studio promotes the offer to its members, and both brands use each other's logos on Instagram and email marketing. They agree that Kiri keeps product sales, the studio keeps class bookings, and any shared customer list can only be used for this campaign unless customers opt in to each brand separately.

That arrangement probably doesn't need a new company. But it does need written terms covering brand use, campaign approvals, customer data, misleading claims under the Fair Trading Act 1986, who handles complaints, and when the campaign ends.

A collaboration agreement is also useful for a co-branding agreement in New Zealand. If your name, logo or reputation is attached to another business's marketing, you should have approval rights over how your brand is used. If you've registered your trade mark with IPONZ, your agreement should say exactly what use is allowed and what stops when the project ends.

When Does A Joint Venture Agreement Make More Sense?

A joint venture agreement makes more sense when the project is more serious, more valuable or more dependent on both parties making ongoing contributions.

You might still stay as two separate businesses, but the relationship has more of a shared commercial purpose. Instead of simply collaborating on a campaign, you're pooling resources to achieve a bigger outcome.

A joint venture agreement may suit you if:

• both sides are contributing money, staff, technology, equipment, IP or key customer relationships
• you'll share revenue, profits or costs
• the project will run for months or years, not days or weeks
• you need a governance process for decisions and budgets
• one party could expose the other to significant loss if they don't perform
• new IP, software, content or data will be created together

For example, imagine a SaaS business and an industry consultancy agree to build a subscription compliance tool. The SaaS business contributes $30,000 of developer time, the consultancy contributes $20,000 of subject matter input and customer introductions, and they plan to split net subscription revenue 60/40 after payment processing and hosting costs.

A short collaboration agreement may not be enough here. The parties need to agree who owns the code, who owns the methodology, who pays ongoing hosting costs, who can approve product changes, what happens if one party stops contributing, and whether either party can build a competing product later.

A joint venture agreement can also help avoid accidentally creating a general partnership. In New Zealand, if you're carrying on business in common with a view to profit, partnership principles may become relevant even if you never meant to form a partnership. That can create uncertainty around authority, liability and decision-making, so it's better to spell out the relationship clearly in a partnership agreement or joint venture agreement.

Should We Set Up A Company For The Project?

You may want a company structure if the project has its own business plan, assets, funding needs or long-term revenue stream.

Setting up a separate New Zealand company can make sense where the project needs its own identity, bank account, contracts, licences, employees or investors. It can also help separate the new venture from your existing business operations.

A company structure is more involved than signing a project agreement. You'll need to think about registration with the Companies Office, company name availability, directors, shares, an NZBN, governance and ongoing company records. The Companies Act 1993 sets out director duties and company administration rules, so this isn't just a branding exercise.

A company may be worth considering if:

• the project will become a standalone business
• both parties want equity rather than just a revenue share
• you may raise capital or bring in other shareholders later
• you want the company to own the IP and contract with customers
• the venture will hire staff or engage contractors directly

If you form a company with another business, a shareholders agreement is usually just as important as the company registration. It can cover decision-making, funding, share transfers, founder roles, deadlocks, restraint obligations, IP ownership and what happens if one party wants to leave.

Be careful with employment and contractor arrangements too. If the venture engages contractors, the Employment Relations Act 2000 matters, including the contractor gateway test introduced through the Employment Relations Amendment Act 2026. The written terms, including any contractor or subconsultant agreement, should reflect the real working relationship, not just the label on the contract.

How Do I Choose The Right Document?

You can choose the right document by looking at risk, commitment, money, control and what happens if the relationship ends.

A useful way to decide is to map the arrangement before drafting anything. Templates can be tempting, but they often miss the commercial detail that makes your project different. A document works best when it's tailored to how your businesses will actually work together.

A Simple Decision Guide

• Use an MOU if you're exploring the idea, sharing information or preparing a proposal, but you aren't ready to fully commit.
• Use a collaboration agreement if you're running a defined campaign, client project, content partnership, referral arrangement or co-branded offer.
• Use a joint venture agreement if you're pooling meaningful resources, sharing profits or losses, creating valuable IP, or working together over a longer period.
• Use a company plus shareholders agreement if the project is becoming its own business with equity, directors, assets, employees or investors.

Questions To Ask Before You Decide

• Who is contributing cash, time, staff, equipment, IP, data or customer relationships?
• Who owns anything created during the project?
• Who invoices customers and collects payment?
• Will profits, revenue or costs be shared, and how will they be calculated?
• Who can approve marketing, pricing, budgets and customer commitments?
• Can either party work with competitors?
• What happens if one party misses deadlines or wants to exit?

Also check whether your project triggers sector-specific obligations. For example, advertising claims need to comply with the Fair Trading Act 1986. If you're supplying goods or services to consumers, the Consumer Guarantees Act 1993 may affect your refund, repair and service obligations. If personal information is shared, the Privacy Act 2020 should be built into the workflow, not left as an afterthought.

What Should A Joint Venture Or Collaboration Agreement Include?

Your agreement should include the commercial detail that will matter once the project is live, not just a friendly statement that you'll work together.

Here is a practical outline you can use to prepare your instructions. This isn't a finished legal document, and you should have it tailored by a legal professional before you use it.

1. Parties: write the correct legal names, NZBNs if available, and contact details for each business.
2. Purpose: describe the project, campaign, product, service or venture in plain English.
3. Term: state the start date, end date, milestones and any renewal process.
4. Contributions: set out what each party will contribute, including money, staff time, IP, equipment, data, marketing or client introductions.
5. Roles And Decision-Making: explain who does what, who manages the project, who can approve key decisions and whether unanimous approval is needed for big items.
6. Payment And Revenue Share: state who invoices, who pays expenses, how revenue or profit is calculated, and when payments are made.
7. Intellectual Property: separate background IP from new IP, then say who owns or can use each category.
8. Brand Use: set rules for logos, trade marks, approvals, social media posts, publicity and co-branded materials.
9. Confidentiality And Privacy: cover confidential information, customer data, access controls, storage, permitted use and breach notification steps.
10. Compliance: allocate responsibility for laws such as the Fair Trading Act 1986, Consumer Guarantees Act 1993, Privacy Act 2020 and any industry rules.
11. Liability And Insurance: say who is responsible for losses, customer claims, mistakes, delays and insurance requirements.
12. Exit And End Of Project: explain how either party can leave, what happens to unfinished work, unpaid amounts, customer communications, IP and brand use.

Try to be specific with numbers. For example, instead of saying profits will be split fairly, say net revenue will be calculated after agreed payment processing fees, fulfilment costs and refunds, then paid 50/50 within 10 business days after month-end. That kind of detail saves a lot of awkward conversations later.

Key Takeaways

• An MOU is useful while you're exploring an idea, but it may not be enough once money, customers or IP are involved.
• A collaboration agreement usually suits a defined project, campaign, co-branding arrangement or shared client engagement.
• A joint venture agreement is better for higher-commitment projects where you're pooling resources, sharing revenue or creating valuable assets together.
• A separate company may make sense if the project is becoming its own business with shares, directors, assets or future investors.
• Your agreement should clearly cover contributions, decision-making, payment, IP, brand use, privacy, compliance and exit rights.
• The best document depends on your risk and commitment level, so tailored drafting is usually safer than relying on a generic template.

If you'd like help with choosing the right structure, preparing your collaboration or joint venture agreement, protecting your IP and brand use, or setting up project governance, you can reach us at 0800 002 184 or team@sprintlaw.co.nz for a free, no-obligations chat.