İstanbul Bilgi University, Faculty of Law and Schellenberg Wittmer Ltd. have co organized the third conference of the Istanbul International Construction Law Conferences on May 4, 2018 on the topic International Construction Joint Ventures.
Unincorporated joint ventures ( JV) are one of the most common features in major international construction projects. Parties choose this contractual arrangement for a variety of reasons, for example to join forces for a project that cannot reasonably be carried out alone due to its technical or financial scope, to combine technical and project-management skills or for an international contractor to benefit from the in-depth knowledge of a local contractor. Sometimes, the parties have no choice because local legislation in the country where the project is located may impose teaming with local entities. Whatever the reason why an unincorporated joint venture is put into place, this contractual figure raises a host of often delicate legal and practical issues. This year’s conference focused on those to which parties sometimes devote insufficient thought. As in the previous years, our speakers were representing a variety of backgrounds: contractors, specialized lawyers, representatives of finance institutions and the academia.
In this conference, the speakers went into details on a selected series of JV-related questions. In his keynote speech in the beginning of the conference, Mr. Elliott Geisinger (Schellenberg Wittmer Ltd.) addressed the different reasons for forming an international construction JV and introduces some JV-specific terminology. Following this intro, the first session chaired by Prof. Dr. Ziya Akıncı focused to the drafting of JV agreements; this is certainly one of the most crucial, perhaps even the most crucial phase for any successful construction JV. The speech given by Mr Yves Jeanrenaud (Schellenberg Wittmer Ltd.) gave the readers an excellent insight into the checklists and “dos and don’ts” that drafters of construction JV agreements must have in mind. Mr İbrahim Seyfittinoğlu (Zafer Construction Company) in turn provided the reader an insider view on the contract formation phase and reflects its valuable experiences in the sector.
The second session chaired by Assoc. Prof. Dr. Kerem Cem Sanlı is devoted to the interplay between construction JVs and competition law. The importance of this subject is obvious, in particular in light of some of the motivations that can lead parties to form construction JVs. The presentations delivered by Mr Gönenç Gürkaynak (ELİG Gürkaynak Law Office) and Prof. Dr. Luís D. S. Morais (Lisbon University) covered the complicated questions that arise in this field from the perspective of Turkish as well as EU law in relation to construction JVs.
Financing considerations are also at the heart of the motivations that will incentivise parties to form construction JVs, as this can be in the interest of both the contractor(s) and the owner. In the third session chaired by Prof. Dr. Yeşim M. Atamer the presentations by Ms. Berna Avdan (Garanti Bank), and Mr Joe Clinton (Allen & Overy) are particularly valuable because this aspect is rarely addressed squarely in literature. They both gave the audience a thorough overview on all aspects to be taken into account when drafting a financing agreement.
Finally as discussed within the fourth and last session chaired by Mr Elliott Geisinger, the materialisation of risks frequently leads to disputes, be it between the JV members and third parties (the owner or subcontractors, typically) or among JV members. The presentations given by Assoc. Prof. Dr. Patrick Thieffry (Sorbonne University) and by Ms Mélanie van Leeuwen (Derains & Gharavi) covered this subject from both angles.
At the end of each session, the presenters as well as the practitioners had the opportunity to discuss examples from practice and exchange ideas.
İstanbul Bilgi University, Faculty of Law and Schellenberg Wittmer. would like to thank DRBF, İNTES, ISTAC Arbitration Centre, Association of Turkish Consulting Engineers and Architects, Turkish Contractors Association for their contributions to the dissemination of this conference.