A Singapore Limited Liability Partnership (LLP) is a kind of business structure where two or extra members integrate a partnership entity that guards co-partners against liabilities due to the willful wrongdoing or gross error of one partner or an association of partners.
In line with the changing business requirements and to be in the team with the global improvements, the government of Singapore after comprehensive public consultation and founded on the suggestions of the Company Legislative and Regulatory Framework Committee (CLRFC), provided the green signal for Limited Liability Partnerships in 2005.
For a Limited Liability Partnership (LLP) to occur, there must constantly be two or additional members. Although Singapore’s Limited Liability Partnership Act of 2005 does not prohibit the advantage of LLP structure to specific categories of experts only, in exercise, LLP structure gives rise to the most sense for chartered professions just (such as attorneys, accountants, etc.) when two or more such experts agree to work together. Whereas for other entrepreneurs glancing to erect a corporation, setting up a private limited company is the best option. And after incorporation, having a digital corporate secretary from Timcole would be the other best.
Ø Facts about a Singapore LLP
1. Liability:
- A Singapore LLP is provided with a distinct legal identity (i.e. distinct from its owners) and thus, an LLP can own estate, sue, or be sued.
- A member of the Singapore LLP cannot be held privately accountable for the illegal commission or error of any other friends.
- In the path of business of a Singapore LLP, if a member comes to be accountable to any individual or company through his laws of council or mistake, the LLP is accountable to the same breadth as the member. Thus claims can be rendered against an LLP to the entire breadth of its assets.
- A member, during the business, is privately credible for penalties that occur due to his act of committee, mistake, or delinquency. Liability assertions can be made against him and his private assets. Nonetheless, other naive partners and their possession will stay protected from such liabilities and their liabilities will be restricted barely to the capital provided by them to the LLP.
- The common rights and responsibilities of Singapore LLP and its members are regulated by the limited liability partnership treaty. In the lack of agreement as to any issue, the First Schedule of the Limited Liability Partnership Act 2005 shall apply.
2. Compliance:
- LLP is expected to maintain its books up-to-date to corroborate all the agreements and monetary role of the LLP, loss to do so may direct to litigation and penalties.
- An LLP in Singapore is not compelled to document its accounts or have them audited. Nor does it require to reveal its capital.
- The manager of an LLP must deliver to the Registrar an annual statement of solvency or insolvency; such statement must be housed within the first 15 months from the date of the enrollment of the LLP. Thereafter proclamation once in every calendar year must be submitted at periods of not more than 15 months.
- Every limited liability partnership must assure that its bills and official mail survive the statement that it is registered as an LLP, and the term and enrollment number of the Limited Liability Partnership must be visibly printed on all its invoices, statements, and official correspondence.
- Any differences to the points of the LLP must be housed with the Registrar within 14 days from the date of modification.
3. Members & Management:
- There must be a minimum of 2 members. Still, there is no cap on the absolute number of members in an LLP.
- The members can be natural individuals or firms.
- A partner may discontinue being a partner upon his demise or abolition or in accord with the limited liability partnership agreement (if any) or, in the lack of such consensus, by giving 30 days’ notice to the other members.
