A Limited Partnership is a blend of partnership with a private limited company. It gives owners the flexibility of operating as a partnership while having a separate legal identity. A Limited Partnership requires at least one General Partner ("GP") and one Limited Partner ("LP").
The GP is the deciding body of the Limited Partnership and has the authority to conduct and manage the business and affairs of the Limited Partnership and exercise all its rights, powers and authority. The GP is personally liable for partnership debts. The LP's liability is limited to the capital contributed or agreed to be contributed in the Limited Partnership and cannot execute documents on behalf of the Limited Partnership nor bind the Limited Partnership.
A Limited Partnership can also apply for a Global Business Licence Category One.
Advantages of the Limited Partnership entity compared to other structures:
- Limited Partnerships are tax transparent vehicles, i.e. the partners are liable to income tax on their share of income from the Limited Partnership. The Limited Partnership, however, may opt to be liable to income tax on its taxable income.
- The liability of the LPs is limited to the amount which they have contributed to the Limited Partnership.
- The day-to-day duties and responsibilites of the Limited Partnership are dealt by the GPs with minimal intervention from the LPs.
- The LPs rank pari-passu in respect of their return of their contributions.
ITL wins Corporate Finance Advisor of the Year 2016
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