Articles
Incorporating a Limited Liability Partnership in Singapore
by Andrew ChenUsually when it comes to Singapore Company incorporation it is recommended registering a private limited company rather than a sole proprietorship or a partnership firm. However, if your specific situation calls for setting up a partnership firm, it is better to incorporate a limited liability partnership (LLP) than a general partnership.
A limited liability partnership is the most recent form of partnerships in Singapore introduced in 2005 and it combines the features of a partnership as well as a private limited company. The reason this form of partnership is recommended over the other forms is because it gives the owners the flexibility of running a partnership firm while enjoying some of the benefits meant for private limited companies.
To incorporate a limited liability partnership, the owners or partners of the business must enter into an exhaustive and detailed agreement. The agreement should cover the exact responsibilities of each partner and how the profit as well as management duties will be distributed amongst each owner. Being a partnership, it is obvious that you need at least two partners to register a limited liability partnership. It should also be noted that this form of business is usually meant for professionals such as accountants, law firms, architects etc. It is not recommended for any business that is involved in trading activities.
The main advantage of incorporating a limited liability partnership is the fact that the LLP is considered as a separate legal entity and has the ability or own property as well as enter into contracts. Another advantage for partners involved in the business is that your personal assets are safeguarded against wrongful acts of another partner of the firm. Partners are also not held personally liable for business debts incurred by the LLP.
While this form of partnership does have various other advantages over general or limited partnerships, it comes with certain disadvantages as well. For instance, an individual partner can commit the partnership to formal business agreements without the consent of the other partner. It is also much more complicated to transfer ownership or investment as compared to standard private limited companies.
Business owners who are considering incorporating a limited liability partnership must consider all pros and cons of this type of business before going ahead with the incorporation procedures.
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About Andrew Chen 
161 connections, 1 recommendations, 323 honor points.Joined APSense since, December 7th, 2009, From Singapore.
Created on Dec 31st 1969 18:00. Viewed 0 times.
this is very good information. thanks so much for posting. the same rules go in the u.s as well. that was also interesting to find. out. since i am a law student your post is also a refresher, as many fellow students don't understand or have a hard time knowing the different kinds of business titles.
Feb 27th 2010 18:36