A limited partnership established pursuant to the Limited
Partnerships (Jersey) Law 1994 provides the benefit of limited
liability to investors, but remains an unincorporated association
with no separate legal personality or perpetual succession vested
in the partnership. Jersey will shortly have two new types of
statutory limited partnerships improving the choice of structures
available to clients when considering commercial structuring.
Both the Separate Limited Partnerships (Jersey) Law 200- and the
Incorporated Limited Partnerships (Jersey) Law 200- were adopted by
the States on 25 May 2010 and await Royal sanction before
registration in the Royal Court. Their adoption is an indication of
Jersey's willingness to maintain its competitive edge for
corporate and fund matters.
Separate Limited Partnerships ("SLP")
A SLP is an limited partnership regarded as a legal person, but
is expressly not to be regarded as a body corporate. Features to
Its capacity as a legal person will not be limited;
It must have a registered office in Jersey;
It must consist of one or more general partners and one or more
A limited partner will be permitted to make contribution via
money, other property or the provision of services;
There shall still be no limit on the number of limited
A limited partner will be permitted to assign its interest
(subject to unanimous consent of all partners and the terms of the
It may be established for a specific term or with unlimited
No audit requirements;
Legal proceedings may be brought in the name of the SLP or the
general partner; and
It will be possible to hold property in the name of either the
SLP or the general partner.
An ILP is a body corporate having legal personality separate
from that of its members. It will have unlimited capacity and
perpetual succession so cannot be dissolved otherwise than in
accordance with the law. Incorporation brings important
considerations and obligations for both the partners analogous with
those applicable when considering the relationships between
companies, directors and shareholders (for example, a general
partner must 'act honestly and in good faith with a view to the
best interest of the ILP' which mirrors a director's
statutory duty under the Companies (Jersey) Law 1991). Features to
It must have a registered office in Jersey;
An annual administration fee is payable to the JFSC;
It must consist of one or more general partners who will be
agents of the partnerships and one or more limited partners;
Any debt or obligation incurred by a general partners in
conduct of affairs of an ILP shall be a debt or obligation of the
A limited partner will still be permitted to make its
contribution via money, other property or the provision of
A limited partner will still be permitted to assign its
Like a director, a general partner must 'act honestly and
in good faith' and exercise 'care, diligence and
Like shareholders, the partners of an ILP can ratify a breach
by a general partner provided all partners authorise and the ILP is
able to discharge its liabilities as they fall due;
Winding up is to be governed by Regulations and therefore will
be different from the provisions made for winding up of limited
partnerships and SLPs;
It will own property in its own name;
It will contract in its own and name and will be able to sue
and be sued in its own name; and
Due to its incorporated status, an ILP will be capable of
committing a criminal offence.
The same JFSC requirements and either consent under the Control
of Borrowing (Jersey) Order 1958 or authorisation under the
Collective Investment Funds (Jersey) Law 1988 will be applicable to
both a SLP and an ILP.
The laws relating to SLPs and ILPs do not prescribe requirements
as to the contents of the limited partnership agreement. Therefore
sponsors and investors have full commercial flexibility to set out
in detail the rights and obligations of the partners.
There are subtle and important differences between the types of
partnership which will shortly be available in Jersey. The choice
of partnership will be determined by taxation and the best
interests of the potential investors.
Considering the popularity of limited partnerships with separate
legal personality in other jurisdictions it is vital that Jersey
improves upon its current offering if it intends to maintain its
premier position in the financial centres market. The introduction
of SLPs and ILPs will certainly help and thereby Jersey should
continue to attract quality fund work as a result in the
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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