Key Facts

• English limited partnerships lack directors but require individuals to sign paperwork for formation.
• Ruth Neidhart has signed documents for 161 ELPs since 2016, linked to offshore firms in Nevis and British Virgin Islands.
• Alexandru Terna has signed 306 ELPs and stated no involvement in management or control of these companies.
• The Moldovan bank fraud case involved $1 billion disappearing through limited partnerships and UK-registered companies.
• The Bill aims to make it easier for Companies House to identify red flags.
• Significant penalties will be imposed on individuals who do not declare their partners accurately under the new legislation.
• Scottish Limited Partnerships (SLPs) have legal personality, unlike English, Welsh or Northern Irish LPs, making them distinct legal entities with separate duties and liabilities.
• Schedule 4 includes information required for registration of limited partnerships.
• Clause 103 pertains to a limited partnership's registered office.
• Amendments were made to include provisions regarding principal offices in all cases.
• Limited partnerships must provide a proposed principal place of business only on registration.
• The penalty for not informing the registrar of changes is a fine of £1 per day.
• Clause 103 introduces the requirement for general partners to maintain a registered office address in their original UK jurisdiction and keep it updated.
• General partners must notify the registrar if they change the registered office address, confirming its appropriateness.
• Failure to comply with these requirements will be an offence resulting in a substantial fine.
• Clause 104 gives existing limited partnerships six months to meet new requirements post commencement of the Bill.
• New clause 49 proposes regulations by March 31, 2023.
• Clause 105 requires limited partnerships to maintain an appropriate email address.
• Clause 106 provides a six-month transition period for existing limited partnerships.
• Clause 107 introduces a duty on general partners of limited partnerships to remove disqualified partners.
• New clause 49 would require the Secretary of State to make regulations under section 87 of the Small Business, Enterprise and Employment Act 2015.
• Regulations will address circumstances allowing corporate directors in companies.
• There will be a registered officer in all circumstances.
• Regulations for corporate directors and identity verification will come into force post Royal Assent.
• Clause 108 inserts proposed new section 8K into the Limited Partnerships Act 1907.
• The duty applies only to general partners and not all partners due to limited partners' restriction from management activities.
• UK LLPs have been involved in international money laundering scandals.
• Registrations of corporate members without a verified person in a management position will be rejected.
• Three major scandals (Azeri scandal, Danske Bank fraud, Moldova bank fraud) involved limited partnerships or limited liability partnerships.
• Transparency International analysis found that one in ten companies had characteristics linked to serious financial crime.
• Out of 1,532 companies examined by Transparency International, 94% had at least one corporate partner with a registered address in high-risk jurisdictions.
• Amendments 18 to 24 and 26 to 28 extend identity verification requirements to registered officers of corporate general partners.
• Amendment 22 provides that regulations for exemptions from identity verification are subject to the affirmative resolution procedure.
• New clause 9 allows for national security-related exemptions from identity verification.
• Amendments aim to align companies and limited partnerships legislation.
• Regulations give flexibility to change provisions more easily than primary legislation.
• Amendment 35 prevents certain applications from being publicly inspected.
• Clause 108 requires legal entity general partners to specify names of registered officers.
• Clause 110 removes the option for signature authentication in limited partnerships registration applications.
• Amendments introduced require new general partners which are legal entities to confirm whether their proposed registered officer is identity verified or exempt.
• Seema Malhotra moves an amendment to remove a defence clause for reasonable belief in notification.
• Kevin Hollinrake argues that the reasonable belief defence is necessary and should remain.
• The registrar will use their judgment in deciding whether an offence has been committed.
• Clause 116 introduces a requirement for confirmation statements from all limited partnerships within six months of the Bill's commencement.
• Amendment 32 ensures that confirmation statement obligations are contained in the Limited Partnerships Act 1907 for Scottish limited partnerships.
• The power to amend existing provisions about confirmation statements for Scottish limited partnerships is removed by amendment 33.
• Amendment 32 applies new section 10E of the Limited Partnerships Act to Scottish limited partnerships.
• Amendment 33 leaves out the power in clause 117 to amend provisions about confirmation statements for Scottish limited partnerships.
• Clause 118 gives HMRC the power to require general partners of UK-registered limited partnerships to provide accounting information.
• General partners who fail to comply with this requirement will commit an offence and face fines or imprisonment.