Change in Partners/ designated partners is an important event in the life of a Limited Liability Partnership (LLP), since it alters one of the basic foundation of a LLP.
Change in Partners can be an
- Admission of a new partner
- Retirement of a partner
- Admission cum retirement of partner (2 events may happen at the same time)
- Change in partners’ designation. – This means a partner becomes designated partner or vice-versa
Designated Partners in an LLP are the equivalent of Directors in a Company. Designated partners are ‘designated’ by all partners in LLP to comply with the LLP Act. 2008.
Following points need to be taken into account:
- In case of admission of a new partner: If the partner proposed to be admitted is a ‘Designated Partner’, he or she shall acquire a Director Identification Number (DIN). To do so, he or she has to file a Form DIR-3. Both the new partner and an existing partner shall attest the Form DIR-3 including the identity and residence proofs.
- Note: Change in partners happens via an amendment deed. It may be an admission deed or a retirement deed or an admission cum retirement deed.
- Partners shall ensure that the Amendment deed is adequately stamped (as per the capital contribution and the respective rules of the state or union territory)
- Amendment deed shall lay down the agreed clauses for terms of change in partners like effective date of admission/retirement, capital contribution, other terms etc.
- Partners have to file LLP Forms 3 and Form 4 with the Registrar of Companies within 30 days of the effective date of change in partners. These forms shall convey all details about the change in partners/ designated partners.
- Forms 3 and 4 shall contain the Amendment deed as an attachment.
Client review of actual work done
“Entrecap Business Services executed our deed for admission cum retirement of partners in our LLP during the second wave of pandemic and completed the entire process in time bound manner with all documentation.”
Change in Partners/ designated partners is an important event in the life of a Limited Liability Partnership (LLP), since It alters one of the basic foundation of a LLP. The Corporate compliance Team at Entrecap Business Services recognise the challenges, the forms and the attachments. Our Team has a record of carrying out successful amendment deeds in the LLP in more than 75 cases.
For Change in Directors in a Company, read here.