The joint venture will have its own bank account. For a consortium, the parties could identify a single bank account and redistribute funds based on their invoices. However, an employer may be pragmatic and agree to pay directly into the bank accounts of each of the unionized partners. Global and multiple liability does not result in additional exposure and facilitates the life of the contractor. The money will be made available to the parties more quickly, without wasting time with additional bank transfers. In the case of a consortium, no new legal entities will be created. It is only a contractual agreement for two (or more) existing companies to work together on this project. In a consortium, each party has the full power to decide its respective price, provisions and margin. When the parties add the prices, the parties often realize that the result is not competitive. This is particularly the case when they perceive risks within the scope of their partner and decide to create provisions for this purpose. Then they start jostling each other to lower the price and increase the probability of the price. But they only have the soft power to influence other partners.
We are a leading ship manager in the region, which has deployed around 3rd sailboats of 3rd oil and gas festivals and offshore oil and gas facilities and support to ships around the world. – Whenever in Indonesia, we are offered a new opportunity to participate in a business opportunity, we are invited by private entities (oil companies) or local government agencies to enter into a consortium agreement with other shareholders. – There are usually 3 shareholders – shipowners with majority shares – its partner with minority shares of assets and we who do not have a share or share in the income or shares generated from the assets. – We offer our services, for which a fixed amount of money is paid. – When we sign a consortium contract, we are subject to a capped liability and sometimes limited liability. – Because of this capped or uncapped liability and a «joint and several liability clause» clause, we are hesitant/unable to sign a consortium and we must allow these opportunities to be forgiven. – We are very interested in signing a consortium, but we want to identify and put in place known and unknown risk protection measures. Is there a product (insurance or something else) that can protect us from liability and other risks. – Is insurance coverage possible for a number of responsibilities or on a case-by-case basis, or can we guarantee flat-rate insurance coverage?