OVERVIEW OF LIMITED LIABILITY PARTNERSHIP IN NIGERIA

The Limited Liability Partnership was introduced by the Companies and Allied Matters Act (CAMA), 2020 to offer a limitation of liability similar to those enjoyed by directors of a Limited Liability Company in Nigeria.

Before the introduction of the Limited Liability Partnership by CAMA, 2020, there was only one form of Partnership regulated by the Companies and Allied Maters Act, 1990 called the general partnership and registered as a Business name

What is a Limited Liability Partnership

A Limited Liability Partnership is described as a body corporate with legal personality distinct from its members in Section 746(1) of CAMA 2020. It is a hybrid business structure that combines limited liability companies and partnerships.

Provisions of the Limited Liability Partnership under CAMA 2020

The Limited Liability Partnership is provided for under Section 746 – 794 CAMA.

Who can incorporate a Limited Liability Partnership?

The incorporation of a Limited Liability Partnership is suitable for individuals in the medical, legal, accounting, architectural, accounting field and all other fields where reputation is a key factor.? The Limited Liability Partnership is appropriate for a group of professionals with lot of experience and clients between them.

Features/Nature of a Limited Liability Partnership

The nature of a Limited Liability Partnership are as follows:

• Separate legal entity: In line with the provisions of Section 746(1) and 756 of CAMA, 2020, a Limited Liability Partnership is a separate legal entity. It can sue and be sued. A Limited Liability Partnership can acquire own, hold, develop, or dispose of property, whether movable or immovable, tangible or intangible, enter into contracts, and have a common seal. The liability of its partners is restricted to the agreed-upon amount stated in the Limited Liability Partner, but the Limited Liability Partnership is accountable to the full extent of its assets
• Perpetual Succession: According to CAMA 2020 Sections 746(2) and (3), a Limited Liability Partnership is a business entity with perpetual succession. Perpetual succession means that the passing of any of its partners or changes in its membership have no effect on the Limited Liability Partnership’s ability to continue operating.
• Formation: A Limited Liability Partnership must be formed by two or more persons carrying on lawful business with a view to make profit in accordance with the provisions of Section 753(1) of CAMA.
• Number of Partners: The Limited Liability Partnership must have a minimum of two (2) partners and one of such partner must be a Nigerian who would be responsible for regulatory compliance. See Section 748 of CAMA.
• Designated Partners: A Limited Liability Partnership shall have at least two designated partners who are individuals, and at least one of them shall be resident in Nigeria in line with Section 749(1) of CAMA, 2020.

Requirements for incorporation of a Limited Liability Partnership

The following are the requirements for the incorporation of a Limited Liability Partnership in accordance with Section 753(2) of CAMA, 2020:

• The name of the Limited Liability Partnership
• The proposed business of the Limited Liability Partnership
• The address of the registered office of the Limited Liability Partnership
• The name and address of each of the persons who will be partners in the Limited Liability Partnership
• The name and address of the persons to be designated partners of the Limited Liability Partnership
• Other information pertaining to the proposed Limited Liability Partnership

Procedure for the incorporation of a Limited Liability Partnership

In summary, the procedure for incorporation of a Limited Liability Partnership are:

• Conduct availability check on the proposed name of the Limited Liability Partnership with the Corporate Affairs Commission (CAC)
• Reserved the approved name of the Limited Liability Partnership
• Fill the necessary details for the registration of the Limited Liability Partnership
• Make payment of the official fee

Upon successful registration, the CAC shall issue a Certificate of registration of the Limited Liability Partnership. The Certificate shall contain the name of the Limited Liability Partnership, the registration number and the date of registration. Section 754(4) of CAMA

Conclusion

Every Limited Liability Partnership shall have either the words, “Limited Liability Partnership” or the acronym, “LLP” as the last words of its name and a Limited Liability Partnership shall not be registered by a name which in the opinion of the CAC is undesirable or identical to that of any other partnership.

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By Corporate & Commercial Law Team at Resolution Law Firm

Email: [email protected]

Tel/WhatsApp:?+2348099223322