A limited liability partnership is a type of partnership in which each partner's liability is limited to the total value of their contributions. In other words, each partner's liability does not jeopardize their personal wealth, only the wealth they brought to the partnership. This may vary to some extent depending on jurisdiction and the provisions of the articles of association. For example, some jurisdictions require that every limited liability company have a general partner with general liability.

Another distinguishing feature of limited partnerships is that all partners have the right to participate directly in the management. This differs from the position of company shareholders, who elect a board of directors to run the company on their behalf, and from silent partners in a limited partnership, who have no administrative rights.

Limited Liability Partner
In principle, all partners in a limited partnership are considered to be the same owners with the same rights and liability limits. This may be modified to some extent by the laws of a particular jurisdiction and by the relevant partnership agreements.

As previously mentioned, some jurisdictions may require a partner to become "general", i.e. H. unlimited liability accepted. Other variations may affect some forms of unlimited liability, e.g. In some US states, individual partners may be personally liable for international torts (civil law violations) of an LLP.

Although they may seem minor at first glance, these deviations can significantly change the recommended approach to forming a limited partnership. For this reason, we strongly recommend that you contact the international team of experts at Confidus Solutions, who will provide a detailed analysis of company registration requirements in each jurisdiction.

Functions of a limited liability company
The primary function of a limited liability partnership is to increase the partners' chances of increasing their individual profits and security compared to what they would gain if they operated individually. Entering into a partnership agreement can also allow the partners to balance the weaknesses and capitalize on the strengths of each: one of the partners may bring significant financial assets, another may be able to offer well-developed manufacturing facilities, while another may have a wide features customer network etc.

Apart from that, limited partnerships have no special functions and differ from other legal forms primarily in the distribution of roles between the partners. A limited liability partnership can engage in any type of business activity including trading, services, manufacturing, etc.