FACTS & INFO
LIMITED LIABILITY PARTNERSHIP IN CYPRUS
A partnership is a relatively simple and flexible way for two or more natural or legal persons to own and run a profit-making business together. Partnerships are governed by the Partnership and Business Names Law, Chapter 116, which is similar to the equivalent English law. Unregistered partnerships are not recognized by law and may be subject to penalties.
Two types of partnerships may be registered under the Partnerships and Business Names Law:
Cyprus General Partnership
The essence of a general partnership is that every partner is jointly and severally liable, and without limitation with the rest of the partners in the partnership for all debts, obligations, and liabilities of the partnership. A general partnership may have between 2 and 20 individual members (up to only 10 if it intends to conduct banking business).
Cyprus Limited Partnership
The registration of a general partnership in Cyprus is that there is at least one general partner who is liable without limit for all debts, obligations, and liabilities of the partnership and one or more limited partners whose liability extends only to the amount to which they have contributed to the partnership. A limited partner may not take part in the management of a partnership and has no authority to bind the partnership. In limited partnerships some of the partners have unlimited liability while the liability of the others is limited to the extent to which they have contributed to partnership capital.
In order for the registration of a partnership to be finalized, a duly signed and executed partnership agreement must be filed with the Cyprus Registrar of Companies together with the prescribed documentation which contains the particulars of the partners such as full name, postal address, nationality, and the names of the partners who are vested with authority to bind the partnership.
The procedures for registration have been designed to make this process as simple as possible. A return, which must be written in Greek, is submitted and must include inter alia the following information:
- The name of the partnership
- The objects of the partnership
- he principal place of business
- The proposed duration of the partnership
- A statement, if such be the case, that the partnership is limited
- The names and addresses of contemplated partners
- The percentage of each partner
If any alteration is made to any of the details previously registered, the Registrar must be notified of the change on form within seven days.
The Partnership documents normally comprise:
- Certificate of Registration
- List of partners and their authority to bind the partnership
- Partnership agreement
Any other information and documentation pertaining to the partnership’s activities to the date of its establishment Members’ Rights and Responsibilities under the Default Rules The law makes an assumption of equality between members of an LLP. For example, unless there is a Members’ Agreement which makes other provisions, these default rules apply: All members share equally in the capital and profits of the LLP Every member may participate in the management of the LLP No member can receive remuneration for acting in the LLP’s business or dealing with its management Members cannot voluntarily assign their interests, nor can new members join, unless all the current members give their consent Members must account to the LLP for profits gained in similar or competing businesses, or from transactions concerning the LLP, or from the use of its property, name or business connections (unless the LLP consented to the arrangement in question) Ordinary matters connected to the LLP’s business can be determined by majority decision, whereas a change in the nature of its business requires unanimity Every member will be entitled to access, inspect and have copies of the LLP’s books Every member must provide true accounts and full information about matters affecting the LLP to any other member (but not to the LLP itself) The LLP must provide indemnities to members for payments and personal liabilities in certain circumstances A member cannot be expelled by majority decision
OUR SERVICES FOR THE COMPANY FORMATION IN CYPRUS INCLUDE:
- Name check and approval
- Preparation and provision of Operating Agreement/Partnership Agreement and other statutory documents of the Partnership.
- Provision of place of business for one year.
- Rubber stamp