Limited Liability Partnership Act 2016

The Limited Liability Partnership Act 2016 has been passed, assented and gazetted on the 2nd December 2016.

A Limited Liability Partnership (“LLP”) structure is the preferred structure for services firms like law firms. It is a type of partnership where every partner in the LLP enjoys limited liability protection against the LLP’s obligations and debts. In addition, partners have limited liability protection against malpractice suits that stem from another partner’s negligent acts. A partner is also given the ability to take part in the decision making of the LLP by taking part in the management of the LLP. 

The mode of operation of the LLP shall be spelt out in detail under a Limited Liability Partnership Agreement (“Partnership Agreement”) that would be entered into between the partners.

Main Highlights of the LLPA

1) Applicability

  • The LLPA only apply to a person

(i) offering professional or consultancy services;
(ii) Holding a Global Legal Advisory Services Licence (as defined under the Financial Services Act 2007); or
(iii) Engaging in such activities as may be prescribed.

2) Registrar

  • The Registrar of Limited Liability Partnerships shall be the Registrar of Companies appointed under the Companies Act 2001.

3) Separate Legal Personality

  • A LLP shall be a body corporate and shall have legal personality separate from that of its partners.
  • Subject to the Partnership Agreement:

(i) A LLP shall have perpetual succession;
(ii) Any change in the partners shall not affect the existence, rights or liabilities of the LLP.

4) Constitution of a LLP

  • A LLP shall consist of 2 or more persons who may be individuals or corporations.
  • Every LLP shall have a Partnership Agreement which determines the manner in which the affairs of the LLP shall be conducted and the mutual rights and duties of the partners and their rights and duties in relation to the LLP.

5) Limited Liability

  • The liability of the partners will be limited to the amount of capital that they agree to contribute to the LLP.

6) Management

  • Every LLP shall need to have at least one Manager who is a natural person (exception being where the Manager of a LLP holding a Category 1 Global Business Licence, shall be a corporation holding a management licence under the Financial Services Act 2007), is resident of Mauritius and qualifying as a Secretary.

For more information contact Hyder Aboobakar on +230 4051521 or mauritius@cimglobalbusiness.com

12 December 2016


Disclaimer


This circular is not intended to be a substitute for legal advice or a legal opinion and should not be relied on or treated as a substitute for the same. It deals in broad terms only and is intended to merely provide a brief overview and give general information. Neither Cim Global Business nor its officers accepts any responsibility and so far as is legally permissible, disclaim all liability for any loss which may arise from reliance on or acting upon the said information. For legal advice you should contact an independent law practitioner on any specific legal problem or matter that you might wish to seek legal advice