3.The Act’s main purpose is to create a new form of legal entity known as a limited liability partnership (“LLP”). The essential feature of an LLP is that it combines the organisational flexibility and tax status of a partnership with limited liability for its members. This limited liability is possible because an LLP is a legal person separate from its members.
4.The Act provides powers to apply the provisions of company law and insolvency law, with appropriate modifications, to LLPs. These powers will be used to put safeguards in place for those dealing with LLPs. It is intended that the safeguards will include provision for the public disclosure of information about LLPs, particularly their finance, and provision for what happens when an LLP becomes insolvent.
Summary