When a domestic company allows a foreign firm to use its brand in exchange for royalty fees it is called a joint venture?

A joint venture typically involves two or more parties coming together to create a new business entity, sharing resources, risks, and profits. When a domestic company allows a foreign firm to use its brand in exchange for royalty fees, it is more accurately described as licensing rather than a joint venture. Licensing allows the foreign firm to use the brand without forming a separate entity, focusing on the exchange of rights for compensation.