Limited partnership - what is it?

Limited partnership is a faith-based society belonging to business entities, to some extent resembling a complete society.

History reference

Faith societies first appeared in the Middle Ages. If the merchant was afraid to leave the country and go on a long voyage, then he transferred his goods to another merchant, and upon his return, the profit was distributed on pre-agreed conditions. In the future, instead of goods, they invested in society, because not all merchants had goods, but they wanted to invest their money.

Hence the ancient definition of the term "limited partnership": this is an entrepreneurial activity when one or more people invest money in a certain business, but do not participate in its development. The depositors, not wanting to disturb their calm and measured life, to bear responsibility, received income from the society on faith, not participating in the activities of this society, but only invested and controlled the process.

The main features of society

Like all enterprises in our country, CT should have constituent documents that determine its activities, management, distribution of capital and other points. To become a full member of a limited partnership, you must first register as an individual entrepreneur. And in order to organize a limited company, at least two participants are required - IP. Perhaps this is the main feature of limited partnership.

Registered capital

Like all business formations, the partnership must form its authorized capital; such a society does not have a boundary upper limit. The minimum size should not be less than 100 minimum wages.

purpose

Limited partnership is a commercial organization, therefore, the main goal is to profit from any activity. If the selected type of activity involves licensing, you will have to obtain the appropriate document. In this form, charitable foundations may exist.

Most often a limited company is created in the field of small business. 2 or 3 interested members participate in the community.

Company management

Full comrades can manage the company. The composition may include investors, which are called participants, commandists. However, their inclusion in the composition occurs only if it is necessary to attract additional funds. The rights of the commandants are limited. In principle, they have only the right to make a profit commensurate with their share, and there is no talk of any participation in decision-making. These participants do not even have the right to challenge the decision of their comrades.

The decision is made by voting. For a decision to be lawful, more than 50% of board members must vote for it. Only 1 can speak on behalf of several participants, but with confirmation of such powers by issuing a power of attorney.

Rights and obligations, responsibility of participants

The basic rights of participants in a limited partnership include:

1. Engaging in any type of activity that does not contradict the norms of the current legislation.
2. Distribution and profit, commensurate with its share in society.
3. Any member is not required to obtain consent to withdraw from the partnership.
4. After the liquidation of the company to receive part of the property.

Participants Responsibilities:

1. Each participant is obliged to work to the extent that is determined by the contract drawn up at the establishment of the partnership.
2. Participants are required to contribute.
3. Do not carry out activities at the expense of society, with which other participants disagree.
4. Responsible for the negative consequences of the company, even with their property.

If society has ordinary investors, then they do not have such broad rights as comrades. They have the right to profit, commensurate with their contribution, the right to get acquainted with the financial statements and transfer their share to any participant. Also, an ordinary investor has the right to leave the company at any time.

A partner who leaves the company for another 2 years is liable for the obligations of the company on faith. The term for calculating these two years is not from the moment of disposal, but from the date of approval of the report on the company's activities for 12 months.

Company Registration

Since a limited partnership is just a type of legal form of an economic formation, it must be registered in the established manner.

The registration procedure and the package of documents are standard. For registration, it will be necessary to draw up a charter, a decision and a protocol on the creation of the company. After payment of the state fee, documents are submitted for registration.

Amendment of title documents

During the partnership, changes may be required, which must be made to the constituent documents. For example, if the composition of the participants - comrades, has changed in connection with the death or loss of legal capacity. It is possible that the company of one of the participants went bankrupt. The main thing is that such a procedure be described in the charter, otherwise the partnership is subject to liquidation.

The adoption of a decision on amendments is made out in a protocol and only by common agreement of all participants.

If, after making the changes, the value of all assets decreases, then the profit cannot be distributed until the moment when their value exceeds the amount of the share capital.

Exclusion from the membership

Full partners of an economic partnership, limited partnership, limited partnership are entitled to demand the exclusion of one of the partners in a judicial proceeding. But all participants must give their consent to his exclusion and there must be a serious reason for such an action, for example:

• the expelled partner does not fulfill his obligations;
• the participant conducts unreasonably business.

Reorganization

A company in faith can be reorganized by any means provided for by law, by merger or division, spin-off or merger, transformation. As a result, you can create an enterprise with a new legal form, for example, LLC or JSC, software, or organize a production cooperative.

Liquidation

A limited partnership company may be liquidated in the following cases:

1. If all members of the society wished to withdraw from it.
2. The exit of one full friend.
3. If one comrade disappeared or lost his legal capacity.
4. The company went bankrupt.
5. Collected property that belonged to one or more participants.
6. Reorganization or liquidation of a company that belonged to one of the participants.

Upon liquidation, the property of a limited partnership is distributed as follows:

1. Investors get their shares.
2. Shares get comrades.

Main difference

These two concepts are often confused, so it’s important to understand what is the difference between a limited partnership and a full partnership. The main difference is that in a full society, all participants are fully responsible for the results in entrepreneurial activity. In a limited partnership, participants are liable for losses in the framework of their contributions. In this case, it is possible for the commandists to participate in the business, provided that they invest personal capital. Otherwise, the two societies are no different.