Introducing Limited Partnerships
The Limited Partnerships Act 2008 came into force on 2 May 2008 enabling registration of Limited Partnerships and Overseas Limited Partnerships. A searchable register of Limited Partnerships and Overseas Limited Partnerships is also now available.
The primary objective of the introduction of the Limited Partnerships regime is to facilitate sustainable growth in New Zealand's venture capital and private equity industries.
Limited Partnerships are a form of partnership involving General Partners, (who are liable for all the debts and liabilities of the partnership) and Limited Partners (who are liable to the extent of their capital contribution to the partnership). The Limited Partnerships Act will replace Special Partnerships that exist under Part 2 of the Partnership Act 1908. Special partnerships are considered obsolete as they do not provide the appropriate structure preferred by foreign venture capital investors.
The introduction of an internationally recognised Limited Partnerships regime will remove barriers to foreign capital investment which provides a valuable source of funding for new companies and early stage expansion capital. The Act will enable New Zealand businesses to compete internationally on a level playing field for venture capital funds.
Features of Limited Partnerships include:
- separate legal personality
- an indefinite lifespan if desired
- a list of activities that the limited partners can be involved in while not participating in the management of the Limited Partnership (safe harbour activities)
- tax treatment for Limited Partnerships.
The registers of Limited Partnerships and Overseas Limited Partnerships are administered by the New Zealand Companies Office. Registration, maintenance and annual return filing for Limited Partnerships and Overseas Limited Partnerships is conducted through manual forms. The registers are able to be searched online from 2 May 2008. More information on Limited Partnerships administration can be found at www.limitedpartnerships.govt.nz.
