Limited Liability Partnership

Limited Liability Partnership

A Limited Liability Partnership (LLP) is a partnership in which some or all partners (depending on the jurisdiction) have limited liabilities. LLP therefore exhibits elements of partnerships and corporations.
The Limited Liability Partnership Act 2008 was published in the official Gazette of India on 9 January 2009 and has been notified with effect from 31 March 2009. LLP is different from a Limited Partnership. It operates like a limited partnership, but in LLP each member is protected from personal liability, except to the extent of their capital contribution in the LLP. It will have perpetual succession. Indian Partnership Act, 1932 shall not be applicable to LLPs and there shall not be any upper limit on number of partners in an LLP unlike an ordinary partnership firm where the maximum number of partners can not exceed 20, LLP Act makes a mandatory statement where one of the partners to the LLP should be an Indian. LLP is one of the easiest form of business to incorporate and manage in India, as there is less compliances LLP is preferred by Professionals, Micro and Small businesses that are rune by closely held members or by family members. As LLPs can not issue equity shares, LLP should be used for any business that has no plans for raising equity funds in future.