Government encouragement or legal policy: Based on the encouragement or legal restrictions of local governments, for example, the Indian government and foreign companies are restricted to hold up to 40% shares locally, and the tariff policy is also the reason why foreign companies set up joint ventures through cooperation with local companies.
Entering foreign markets: For example, in the newly established joint venture automobile manufacturing company between Toyota and General Motors, Toyota gained practical knowledge of entering the American market, while General Motors acquired Toyota's technology and management methods.
Extended data
If the capital contribution is made by shares at a fixed price, it may be exempted from land value-added tax if it is a real estate enterprise or a real estate development enterprise.
If an enterprise exchanges non-monetary assets, sells goods or transfers assets, or provides services, the enterprise may dispose of assets at fair value, and enterprise income tax shall be paid for both asset disposal and investment.
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