Part 4 Part 4 Limited Partnerships
Article 37 - Limited and General Partners(1) A
Limited Partnershipmust have:(A) one or more General Partnerseach of whom has unlimited liability, and(B) one or more Limited Partnerseach of whom has limited liability so long as he complies with Article 38.(2) A person does not become a Limited Partnerin a Limited Partnershipuntil registered as such.(3) A person does not cease to be a Limited Partnerin a Limited Partnershipuntil he is registered as no longer being a Limited Partnerin the Partnership.(4) But subsection (2) does not apply if the person ceases to be a Partneron his death or (if not an individual) dissolution.(5) A " General Partner" is a person who:(A) is a Partnerin a Limited Partnership, but(B) is not a Limited Partner.(6) A Partnershipis not a Limited Partnershipuntil registered as such in accordance with the provisions in Part 5 of these Regulations.(7) Article 37 (2) and (3) do not apply to a Limited Partnerin a Limited Partnershipthat is a Collective Investment Fund.
Article 38 - Restricted role of Limited Partner(1) A
Limited Partnermust not take part in the management of the Partnership Businessor affairs.(2) Nothing in subsection (1) prevents a Limited Partnerfrom doing anything which is a permitted activity under Article 39.
Article 39 - Permitted activities for Limited Partners(1) Each of the following is a permitted activity:(A) taking part in a decision about the variation of the
Partnership Agreement;(B) subject to Article 43(4) and (5), taking part in a decision about whether to approve, or veto, a class of investment by the Limited Partnership;(C) taking part in a decision about whether the general nature of the Partnership Businessshould change;(D) subject to Article 43(4) and (5), taking part in a decision about whether to dispose of the Partnership Businessor to acquire another Business;(E) taking part in a decision about whether a person should become or cease to be a Partner;(F) taking part in a decision about whether the Partnershipshould end;(G) taking part in a decision about how the Partnershipshould be wound up;(H) enforcing his rights under the Partnership Agreement(unless those rights are to carry out management functions);(I) approving the accounts of the Limited Partnership;(J) being engaged under a contract by the Limited Partnershipor by a General Partnerin the Limited Partnership(unless the contract is to carry out management functions);(K) acting in his capacity as a director or employee of, or a shareholder in, a corporate General Partner;(L) taking part in a decision which involves an actual or potential conflict of interest between a Limited Partner(or Limited Partners) and a General Partner(or General Partners);(M) discussing the prospects of the Partnership Business;(N) consulting or advising a General Partner, or the General Partners, about the activities of the Limited Partnershipor about its accounts (including doing so as a member of an advisory committee of the Limited Partnership);(2) Without prejudice to Article 39(1)(E) above a Limited Partnerhas no right to dissolve a Limited Partnershipby notice.(3) Without prejudice to Article 39(1 )(F) above, only a General Partner, or the General Partners, may decide that the Limited Partnershipwill not break up upon the death or (if not an individual) dissolution of a Partner.
Article 40 - Limited Liability of Limited Partner(1) Subject to subsection (3) and Article 41, a
Limited Partneris not personally liable for any Partnership Obligationincurred while he is a Limited Partner.(2) While a person remains a Limited Partner, he is not entitled either directly or indirectly to draw out or receive back the whole or part of any Relevant Capital Contribution made by him to the Partnership.
Article 41 - Limited Partner who has unlimited Liability
Article 42 - General application of Regulations to Limited Partnerships(1) Subject to any provision to the contrary, the entirety of these
Regulationsapply in relation to Limited Partnershipsas it applies in relation to General Partnerships.
Article 43 - Rights and duties of the Partners etc(1) A
Limited Partneris not subject to the duties in:(A) Article 14(2)(A) and (C) (keeping Partnersinformed and accounting for Profitsof a competing Business); and(B) Article 20 (keeping accounting and Partnership Recordsetc.).(2) Article 21 ( Partnershipbound by acts of Partnerscarrying on Businessin usual way) does not apply in relation to a Limited Partner.(3) Subsections (4) to (7) contain Default Rulesfor a Limited Partnership.(4) Differences about ordinary matters connected with the Partnership Businessor affairs may be decided by:(A) the General Partner; or(B) if there is more than one General Partner, a majority of them.(5) But differences about other matters connected with the Partnership Businessor affairs must be decided by:(A) the General Partner; or(B) if there is more than one General Partner, all of them.(6) The question whether a Limited Partnershould be given authority to act on behalf of the Partnershipis not an ordinary matter.(7) The PartnershipAgreement cannot be varied under subsection (4).
Article 44 - Change in Partners(1) Nothing in Article 30 prevents a person to whom a
Partnerhas assigned the whole of his share absolutely from becoming a Partnerin place of the assignor if:(A) the General Partneragrees to the substitution or, if there is more than one General Partner, all of them agree to it; or(B) the substitution is made in accordance with the Partnership Agreement.
Article 45 - Break up and winding up of Limited Partnership(1) It is a
Default Rulefor a Limited Partnershipthat the responsibility for winding up the Partnershipunder Article 34 is that of the General Partneror General Partners, unless:(A) the Tribunalorders otherwise; or(B) there are no General Partners.