A joint venture is a business arrangement in which two or more persons or entities agree to jointly pursue a specific business objective—often more limited in scope and duration than a typical business or company. A joint venture may be organized as its own corporation or limited liability company. In addition to the risks of the business venture, a person or entity considering a joint venture should understand the tax issues, liability issues, and fiduciary duty issues involved.

In Hawaii, a joint venture is recognized as a business arrangement where two or more parties come together to undertake a specific business project or goal. This type of partnership can be structured in various forms, including as a corporation or a limited liability company (LLC), depending on the needs and preferences of the parties involved. When forming a joint venture, parties must consider Hawaii's state statutes and federal laws that govern such entities. Tax implications are an important consideration, as the structure of the joint venture will affect how it is taxed—whether as a pass-through entity or as a separate tax entity. Liability issues are also crucial; the parties must understand their potential personal liability for the debts and obligations of the joint venture, which can vary based on the chosen structure. Lastly, fiduciary duties arise in a joint venture, requiring parties to act in the best interest of the joint venture and each other. It is advisable for parties to draft a clear joint venture agreement outlining the terms of the venture, the contributions of each party, the distribution of profits and losses, management responsibilities, and the process for dispute resolution. Consulting with an attorney to navigate these complex legal issues is recommended to ensure compliance with applicable laws and to protect the interests of all parties involved.