Another Way To Reform Limited Partnership Law

Following the responses to its consultation last year on the

reform of limited partnership law, the Government has decided to

try a new approach. Instead of attempting a thoroughgoing reform in

one go, it proposes to introduce changes piecemeal, so that the

more straightforward ones can be dealt with relatively quickly

while more problematic areas are reconsidered. The Government is

seeking views on this approach.

Although it seems sensible to avoid delay where possible,

implementing change in a fragmentary fashion can create

difficulties. It would be a pity, for example, to end up with a

body of law that lacks consistency and coherency in some respects

or is not as accessible as it might be.

To view the article in full, please see

below:

Full Article

The Government has published an update following responses to

its consultation in August 2008 on the reform of limited

partnership law, which contained proposals for a radical

restructuring of the law.

Click here to read our previous Law-Now on the

consultation.

The impetus for reform is the wish to enhance the UK's

position as a jurisdiction of choice for fund managers, who

typically set up their funds as UK limited partnerships, and to

strengthen investors' confidence in these vehicles. Among its

principal aims, the Government wants to give limited partners a

more active role in monitoring the business without exposing them

to unlimited liability, to increase flexibility for limited

partnerships and to streamline the registration process.

The Government received 33 responses to the consultation, and

these showed that there was no consensus on many of the key issues.

It has therefore decided that a re-think is needed in certain

areas. On the other hand, as there is general support for

modernisation and clarification of limited partnership law, the

Government is now suggesting that it should tackle the reform

process in a modular (or piecemeal) way with a series of

Legislative Reform Orders (LROs), each on a specific issue. The

intention is for the first LRO to ensure that the registration of a

new limited partnership is conclusive evidence of its existence,

and will require "Limited Partnership", "LP" or

Welsh equivalents to be added at the end of a limited

partnership's name.

The Government has asked for comments on the modular

approach.

Although we see the merit of getting on with the less

problematic changes, our preference would be for all of the

legislative changes to be implemented...