Limited Liability Partnership or famously known as LLP is a company where all partners have limited liabilities. Here, one partner is not responsible for other partners’ diligence or negligence. Due to its simplicity in functioning and limited liability to partners, it is one of the top choices for small and medium sized businesses.
The existence and running of LLP does not solely depend on either of the partner. For example, with the demise of a partner in Partnership Company may cause the company to disintegrate; whereas, in LLP, it may not cease to exist in such a case. The partners of an LLP may keep changing from time to time and it will not affect the LLP’s continuity. The liability of partners in LLP is limited to the amount of capital invested and there is no minimum limit to the amount of capital to be invested.
An LLP agreement is one of the main documents required for the making of an LLP Company. It is an agreement made between the partners of the firm. Hence, drafting the agreement is of much importance as it carries information regarding the partners, capital contribution, profit sharing ratio, board meetings, protocols for dispute resolution, closure of the firm, etc.
Procedure for Changing LLP Agreement
As the LLP agreement is part of the registration procedure, any change within the agreement must be intimidated to the Registrar. There is a simple procedure to be followed in case of change in LLP agreement.
Any change in the LLP agreement must be met with approval from the partners.
The Registrar will verify submitted form and the necessary changes will be made.