Similarly, the management of Wahaha group of companies should understand that going against the agreement is a crime and not an ethical business practice in International trade.Other than opting for a direct legal option to resolve the issue, the other strategic recommendation would be to use arbitration as the aggrieved company resorted to have Stockholm to mediate the issue.
He divided the profits between the JV and the non-JV companies.The creation of the non-JV companies violated both the trademark license and the JV agreement. Wahaha.co.uk is a British designer and manufacturer of high quality printed gifts. Danone Group and its partner, Wahaha Group Company, are shareholders in a joint venture (JV) company that is the largest beverage company in China.
Danone apparently learned about it in 2005 and insisted it be given a 51% ownership interest in the non-JV companies. If the Chinese side feels it has been tricked or duped into signing away its rights, it will take action to correct the situation, as is the case in the Wahaha JV.• Do not expect a 51% ownership interest in a JV will provide effective controlFor foreign investors that decide to go forward with a 51/49 structure, it is important not to rely on control of the board of directors as a means to exercise control over the JV. In fact, the act was not supported by facts, but based on unnecessary claim that the partner was ruining reputation. In essence, breach of contract is an insincere act by the so called dominant company due to vested interest and greed for control of stake in the joint business operation (Daniels, Radebaugh and Sullivan 32). In fact, the act was not supported by facts, but based on unnecessary claim that the partner was ruining reputation. They can be avoided by following certain basic rules. This was unjust because he was supposed to follow a better means of conflict resolution in case there was any (Wild and Wild 104).Considering the agreement, Danone Company had 51 percent share in the joint venture, meaning that it had an upper hand on the management and decision making in the new company. Therefore, whether the government approved it or not, each party accepted to work with one another in a non-competitive and mutual manner.One of the strategic issues was to resolve the breach of contract that Wahaha Company secretly committed despite signing an agreement to work together without competition. You can use them for inspiration, an insight into a particular topic, a handy source of reference, or even just as a template of a certain type of paper. The intermediary was to look at the information carefully and make impartial decision on the controversy that threatened the business relationship between the two companies.
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It does not appear that any of the JV documents were revised to deal with this changed situation.• Management of the JV and the creation of competing non-JV companiesBeginning in 2000, Zong and Wahaha Group began to create a series of companies that sold the same products as the JV and used the Wahaha trademark.
Since the company had become the leader in manufacturing and distributing bottled water, it considered having a working partnership with Wahaha Company. His media attack against the partner, purporting to be in the spirit of Chinese nationalism was unjustified since it promoted discriminatory and immoral business dealings” after binding himself in the contract (Angwin 18). We first began our business by designing and printing unique phone cases and iPad cases.
Danone seems to have made no attempt to integrate itself within the JV. On the example of the hospital. In essence, breach of contract is an insincere act by the so called dominant company due to vested interest and greed for control of stake in the joint business operation (Daniels, Radebaugh and Sullivan 32).The giant company would like to keep its dominance in decision making and resource allocation, thus could practice double standards, while dealing with its partner in the merger. The “bullying and slander” accusations he labeled against his partner and remaining adamant that “he would make sure that Danone does not win for sure and his company does not lose for sure” could be treated as double speak and was not supported by reliable evidence.Another issue that significantly featured in the case was the competition that Wahaha Company experienced when Danone Company launched its business operations in the Chinese market.