What is the meaning of Business Activities of the LLP?
The Business Activities of the LLP are the boundary or limitation on the activities which a LLP can undertake. Main business activities will be mentioned in the LLP Agreement. It’s the business activities for which any start-up is established. With the expansion of the area of business the LLP may change its main business activities
Need for change in Business Activities of the LLP:
The business activities mentioned in the LLP Agreement has a great importance, and this clause determines the purpose of the LLP. The business activities of the LLP as drafted in the LLP Agreement is a boundary of its operation regarding what activities the LLP can perform. Any act of the LLP beyond what is mentioned in the agreement is ultra vires and thus void. To change the Business Activities of LLP, the LLP shall follow procedure mentioned in its LLP agreement and LLP Act, 2008
Steps Involved for change in Business Activities of the LLP:
Step-1: Obtain approval of the partners for business activity change:
To decide on proposed new business activities of the LLP. The partners need to decide in a properly convened meeting as per the LLP agreement. After the decision has arrived the same must be written and signed by the partners.
Step-2: Drafting of Amendment LLP Agreement:
The next step after obtaining written consent of the partners for change in business activities of the LLP is to draft and execute the amendment LLP Agreement with change in business activities of LLP.
Step-3: Filing of Forms for Change in Business Activities of the LLP in Form-3:
The amended LLP agreement along with the written consent of partners for change in Business Activities of the LLP need to be filed in Form No-3 of the LLP.
Documents Required for Change in Business Activities of LLP:
- List of Designated Partner & Partners.
- Initial LLP Agreement.
- Proposed business activities of the LLP.
- Digital Signature (DSC) of any one of the Designated Partner of the LLP.