Relevant Matter
Legislation
Public Policy Area
Justice and Equality
Period
1 Jan, 2019 to 30 Apr, 2019
Specific Details
Consultation on the Limited Partnerships Act 1907
Intended results
In our view, limited partnerships serve an important economic purpose, but Ireland’s limited partnership framework requires modernisation both for the benefit of domestic limited partnerships, and to ensure that Ireland remains an attractive jurisdiction in which to do business for global investors who favour limited partnership structures, in particular in the areas of investment funds, private equity and venture capital.
A limited partnership should be required to use “Limited Partnership” or the abbreviated “LP” in its name (or the Irish equivalents) to make it easily identifiable as a limited partnership, similar to the position under Irish law in respect of a limited liability company. The abbreviation “LP” is also commonly recognised throughout the international business community as meaning a limited partnership.
The principle of publicising an address in Ireland for a limited partnership ought to be driven by the valid requirement that there be a place in the State at which third parties may serve notices on the limited partnership and not by anything further.
References in Section 8 of the 1907 Act to effecting registration by sending the required statement to “the registrar in that part of [Ireland] in which the principal place of business of partnership is situated or proposed to be situated” are archaic and out of place in the Ireland of 2019.
In that regard, we would note that a company formed under the Companies Acts is required to have a registered office in the State, however, the Companies Acts do not require that any particular amount of business of a company be conducted at its registered office. The same ought to apply to limited partnerships.
A limited partnership should have to make some type of basic annual filing (such as a confirmation statement) to the Registrar so that it can be determined that a limited partnership is still active (“Annual CS”).
The 1907 Act should be updated to require a general partner to make a filing when it enters into a liquidation process.
The question of strike off needs careful consideration. Whatever may be decided, a strike-off, if that is what may happen, must not operate to remove the limited partners’ limited liability. If a company is struck off, the liability of its members is unaffected.
The Irish economy has lost out on, and continues to lose out on, significant employment opportunities and tax revenue due to the antiquated limited partnership legislation currently in place in Ireland, which dissuades funds from establishment in Ireland. Ireland needs to have partnership legislation at least equal to the competitive jurisdictions, including the UK, Luxembourg and the Channel Islands. It also needs bespoke legislative provisions for large funds established as limited partnership
There is a basic prohibition relating to a limited partner engaging in “management” and so losing limited liability protection. The rule, as it currently stands, affords limited partners with a significantly lower level of protection when compared the limited partnership regime in our competitor countries. There is almost no Irish judicial guidance as to what constitutes “management” by a limited partner in an Irish limited partnership.
The 20 partner limit (or 50 for certain partnerships) on the number of persons who may become partners in a limited partnership should be removed (to mirror an equivalent reform made in the UK), or at a minimum increased. This is a critical point requiring immediate action. We would note that this requirement was removed in the UK under article 2 of the Regulatory Reform (Removal of 20 Member Limited in Partnerships etc.) Order 2002/3203.
There is a divergence of opinion on the current position under the 1907 Act as to limited partners potentially losing the benefit of their limited liability due to non or late filing of LP related forms in the CRO in addition to the existing statutory liability of the general partner for a fine for non or late filing. It should be clarified in legislation that a loss of limited liability will not occur on a late filing.
Name of person primarily responsible for lobbying on this activity
Ken Murphy, Director General
Did any Designated Public Official(DPO) or former Designated Public Official(DPO) carry out lobbying activities on your behalf in relation to this return? You must include yourself, and answer Yes, if you are a current DPO or a DPO at any time in the past. (What is a Designated Public Official?)
No
Did you manage or direct a grassroots campaign?
No
Was this lobbying done on behalf of a client?
No
Lobbying activity
The following activities occurred for this specific Subject Matter Area.
Submission (1)
Read the Society's submission, and keep up to date with our law reform activities at https://www.lawsociety.ie/Solicitors/Representation/Policy-and-Law-Reform/
Designated public officials lobbied
The following DPOs were lobbied during this return period on this specific Subject Matter Area. These DPOs were involved in at least one of the Lobbying Activities listed above, but not necessarily all of them.
As returns are specific to a Subject Matter Area the above Lobbying Activities may be associated with multiple returns.
Heather Humphreys
Minister (Department of Business, Enterprise and Innovation)