Sole proprietorship, partnership, joint venture, corporation

A corporation is an artificial being created by operation of law, having the right of succession and the powers, attributes, and properties expressly authorized by law or incident to its existence.

A corporation is one type of business organization. It is also one of the most important factors in economic development. Other types of business organizations are sole proprietorship, partnership and joint venture.

A sole proprietorship is often called a "one-man business organization." The owner is personally liable to creditors or obligees, but he enjoys all profits of the business to the exclusion of others.

Partnership is a business organization based on mutual trust and confidence. By the contract of partnership two or more persons bind themselves to contribute money, property, or industry to a common fund, with the intention of dividing the profits among themselves.

Joint venture is a one-time coming together of person, whether they be natural or juridical, for a particular undertaking or project. It does not envision continuity and aims to end the relationship after the project's success or failure. There is huge similarity between a partnership and a joint venture; however,  the Supreme Court has spoken, saying that, although a corporation cannot enter into a partnership contract, it may, however, engage in a joint venture with others.
A joint venture (JV) is a business entity created by two or more parties, generally characterized by shared ownership, shared returns and risks, and shared governance. Companies typically pursue joint ventures for one of four reasons: to access a new market, particularly emerging markets; to gain scale efficiencies by combining assets and operations; to share risk for major investments or projects; or to access skills and capabilities.


By way of exception, corporations may enter into contracts of partnership if:

1. The articles of incorporation expressly authorize the corporation to enter into contracts of partnership;
2. The agreement or articles of partnership provides that all the partners will manage the partnership; and
3. The articles of partnership stipulates that all the partners are and shall be jointly and severally liable for all obligations of the partnership.