Business Cooperation Dispute Advisory

Business cooperation contracts (BCC), capital contribution agreements, and joint ventures without a newly established legal entity — when cooperation breaks down, disputes are often fierce because the parties are both partners and “owners” of common assets: who manages, how profits are shared, how an exiting party is handled. The key question is whether the original cooperation agreement was clear enough.

Common Types of Business Cooperation Disputes

Profit distribution disputes: how profit is calculated, which expenses are deductible, when distribution occurs — often because the agreement was written vaguely;
One party withdrawing capital/exiting the cooperation: valuation of the contributed capital upon exit, who has pre-emptive buyback rights;
Breach of contribution obligations: one party fails to contribute sufficient capital/land on schedule, leaving the other to cover;
Management and administration: who has decision-making authority, use of the seal, signing contracts with third parties;
Termination of cooperation: liquidation of common assets and division when cooperation ends early.

Applicable Legal Framework

Cooperation contracts (Articles 504–512 of the Civil Code 2015): the parties jointly contribute assets and effort to perform common work, sharing benefits and responsibilities;
Commercial Law 2005 (for business cooperation contracts — BCC in commercial activities): 2-year limitation period for lawsuits (Article 319);
Law on Enterprises 2020: if the cooperation is institutionalized as a company (joint venture), disputes among members/shareholders additionally apply company regulations.

Approaches to Resolution

Review the cooperation agreement and all appendices and working minutes — identifying each party’s rights and obligations;
Negotiation: most cooperation disputes should prioritize negotiation since the parties remain tied by common assets; a lawyer’s involvement helps frame the legal basis for the plan;
Conciliation, arbitration/court: if negotiation fails, resolution follows the mechanism agreed in the contract;
Liquidation and division: inventory of common assets, valuation, and settlement of common debts before division.

Prevention from the Start

A good cooperation agreement must clearly state: contribution ratios and valuation of contributed assets; governance mechanisms and decision-making authority; how and when profits are calculated and distributed; conditions for one party’s exit and valuation upon exit; deadlock resolution mechanisms; and dispute resolution methods. Drafting carefully at the start is always cheaper than disputing at the end.

How Does ANT Legal Assist?

Drafting and reviewing business cooperation contracts and capital contribution agreements;
Advising on and representing clients in negotiations when cooperation shows signs of breakdown;
Representing clients in dispute resolution before arbitration and courts;
Advising on liquidation and asset division upon termination of cooperation.