“解释”（法律、合同）需用interpret 一词，而不能用explain；前者的含义是make clear or bring out the intended meaning of something（阐明），后者仅仅表示 make something plain or give the meaning of something （说明）。二者的差异可以从下面两个句子中加以辨别：

A dictionary explains the meaning of words.

词典是解释词义的工具书。

Poetry can hardly be interpreted.

诗无定诂。

综上可知，此处的解释应用interpret，完整版翻译如下：

The conclusion, validity, interpretation and performance of the contract of a joint venture and settlement of disputes in connection therewith shall be governed by the laws of the People's Republic of China.

以上解释摘抄自孙万彪《英汉法律翻译教程》。