Change in Partners/ Designated Partners in a LLP
Partners in a Limited Liability Partnership (LLP) are either designated partners or otherwise.
Designated Partners in an LLP are considered as the equivalent of Directors in a Company. Designated partners are those partners who are ‘designated’ by all partners in LLP to comply with all the provisions of the LLP Act. 2008.
Designated Partner, before appointment, shall acquire a Director Identification Number (DIN).
Following points need to be taken into account:
- Partners can undertake any changes in Partners (like admission or retirement of a Designated Partner/ Partner) only via an amendment deed. It may be an admission deed or a retirement deed or an admission cum retirement deed.
- Also there may be change in designation from a designated partner to an ordinary partner or vice-versa.
- 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 an Amendment deed as an attachment.
- It is very very important to file Forms 3 and 4 within 30 days since they contain substantial late fees. We have seen cases where the late fees have gone upto Rs. 40,000/- (Rupees Forty Thousand only)
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). It alters one of the basic foundation of a LLP. 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.