The Corporate Affairs Commission newly introduced new type of company registration in Nigeria.
The new companies are limited liability partnership(LLP) and limited partnership(LP)
“THE COMMENCEMENT OF REGISTRATION OF LIMITED LIABILITY PARTNERSHIPS (LLPs) AND LIMITED PARTNERSHIPS (LPs) AND DEPLOYMENT OF THE REGISTRATION SOLUTIONS ON COMPANY REGISTRATION PORTAL (CRP)”
this press release was communicated to the public,and also to verified and accredited agents, the commission briefly described the two new company registration. the message is hereby re-stated herein under.
“The Commission wishes to inform its esteemed Customers and the General Public that it has commenced the registration of Limited Liability Partnerships (LLPs) and Limited Partnerships (LPs). To this end, it has deployed the registration interfaces for LLPs and LPs on the Company Registration Portal (CRP). Customers and members of the General Public wishing to register LLPs and LPs may now do so on the CRP.
What is Limited liability Partnership: The LLP is a partnership arrangement with legal personality separate from the partners. The liabilities of the partners of an LLP are limited to the amount agreed to be contributed or what is outstanding in the event of winding up. An LLP shall have at least two (2) “Designated Partners” who will be responsible for compliance with the requirements of the Act by the LLP. The Designated Partners shall be individuals at least one of whom must be resident in Nigeria. The name of an LLP shall end with the word “Limited Liability Partnership” or the abbreviation “LLP”.
What is Limited Partnership :Briefly called in abbreviation LP, is a partnership arrangement with at least one general partner and at least one limited partner. The liabilities of a general partner are unlimited while the liabilities of a limited partner are limited (unless he takes part in the management of the partnership). An Limited Partnership shall not consist of more than 20 persons. The name of an Limited Partnership shall end with the word “Limited Partnership” or the abbreviation “LP”.
Limited Liability Partnership DISTINGUISHED FROM Limited Liabilty Company AND ALSO FROM LIMITED PARTNERSHIP
Limited Liabilty Partnership Distinguished from Limited Liability Company,limited liability company
Unlike the Limited Liabilty Partnership, A limited liability company has directors and share holders and not partners .
In Limited Liabilty Partnership All the partners contribute funds and resources to the company in the ratio to which they agree.
In Limited Liabilty Company, shares of the company must be fully subscribed to by the shareholders of the company.
In Limited Liabilty Company, the directors are distinct and separate from the company, this is also a common feature in the Limited Liability Partnership, there is a separate legal personality between directors and partners in the two types of company.
There is Limited liability– it is worthy to note that in both Limited Liability Partnership AND Limited Liability Company, the liabilities of the shareholders are limited to the amount of shares subscribed to by the shareholders in (Limited Liability Company) AND also liabilities are limited in Limited Liability Partnership to the amount agreed to be contributed by each partner.
The alter ego of the companies are known as Partners in LLP, while in LLC they are Known as Directors and Shareholders.
Lifting the veil: in both LLP and LLC the veil of the company can be lifted to discover who are running the company in the event of winding up or fraud on the company.
Compliance : An LLP shall have at least two (2) “Designated Partners” who will be responsible for compliance with the requirements of the Act by the LLP. The Designated Partners shall be individuals at least one of whom must be resident in Nigeria.
Management and Ownership– One person can fully own a LLC without the need for a partner, while in LLP, the minimum number of partners is two.
Maximum number of partners– in LLP, the maximum number of partners is fifty while the maximum number of partners in LP is twenty.
it is important to note that LLP AND LP were introduced in CAMA ACT 2020