Introduction
Limited Liability Partnerships (LLPs) provide a flexible and efficient business structure that combines the advantages of both partnerships and companies. Adding a designated partner to an LLP requires following a specific process to ensure legal compliance. In this blog, we will outline the step-by-step procedure to add a designated partner in an LLP.
Step 1: Obtain DPIN
The first step in adding a designated partner is to obtain a Designated Partner Identification Number (DPIN) for the individual. DPIN can be obtained by filing Form DIR-3 with the Ministry of Corporate Affairs (MCA) or through the LLP portal. The applicant must provide relevant personal details, including name, address, proof of identity, and proof of residence.
Step 2: Consent and Appointment
Once the DPIN is obtained, the designated partner must give his/her consent to act as a partner in the LLP. The LLP agreement should be reviewed to ensure compliance with the terms and conditions regarding the addition of partners. A resolution must be passed by the existing partners to approve the appointment of the designated partner. The resolution should be duly signed and maintained as part of the LLP’s records.
Step 3: Filing with the Registrar
The LLP must file Form-4 with the Registrar of Companies (RoC) within 30 days of the appointment of the designated partner. Form-4 contains details such as the LLP’s name, LLPIN (LLP Identification Number), details of existing partners, and the newly appointed designated partner. Along with Form-4, relevant supporting documents, such as the consent letter, DPIN, and LLP agreement, must be submitted to the RoC.
Step 4: Update LLP Agreement
After the designated partner is added, the LLP agreement should be updated to reflect the changes. The agreement must be amended to include the name and details of the new designated partner. The amended agreement should be executed on non-judicial stamp paper, signed by all partners, and notarized. It is crucial to maintain accurate and up-to-date records of the LLP agreement.
Conclusion
Adding a designated partner to an LLP involves obtaining a DPIN, obtaining consent, passing a resolution, filing the necessary forms with the Registrar, and updating the LLP agreement. It is important to follow the prescribed legal procedures to ensure compliance and maintain the integrity of the LLP. Seeking professional guidance from a company secretary or a legal expert can simplify the process and ensure a smooth transition.
