What is the meaning of Partner Change?
The role of designated partners in case of LLP is on same footage as of Directors in the case of a Company. The designated partners are directly responsible for the compliances of all provisions provided under LLP Act and the provisions specified in the LLP Agreement. The appointment of new designated partners can be required for the LLP from time to time based on the requirements of management changes in the LLP.
Need for Partner Change of the LLP:
The need for partner change may arise in the following situations:
- Appointment of New Designated Partner/Partner of the LLP
- Resignation of existing Designated Partner/Partner of the LLP.
The appointment and resignation of designated partners/ partners of the LLP shall be as per the provisions of LLP Act, 2008, regulations and procedure laid down in the LLP Agreement.
Steps Involved for Partner Changes:
Step-1: Apply for DIN and DSC for new designated partner:
For appointment of new designated partner in the LLP it is required to obtain DIN and DSC for the new designated partner. LLP is required to make application in Form DIR-3 for allotment of DIN of new designated partner along with written consent of partners for appointment of new designated partner, address proof, identity proof of new designated partner.
Step-2: Obtain approval of the partners for partner changes:
The partners need to decide in a properly convened meeting as per the LLP agreement for induction of new designated partner or cessation of existing designated partner, if any. After the decision has arrived the same must be written and signed by the partners.
Step-3: Drafting of Amendment LLP Agreement:
The next step after obtaining written consent of the partners for partner changes is to draft and execute the amendment LLP Agreement with for appointment of new designated partner and cessation of partner and assignment of partnership rights/profit sharing ratio among the partners of LLP.
Step-4: Filing of Forms with RoC:
The partner changes have to be intimated to Registrar of Companies in Form No. 3 & 4 of the LLP along with the written consent of partners, consent to act as partner/ designated partner, resignation letter of partner/ designated partner, if any along with the amendment agreement.
Documents Required for Partner Change:
- List of Designated Partner & Partners.
- Initial LLP Agreement.
- Address Proof of Proposed New Partner/Designated Partner.
- Identity Proof of Proposed New Partner/Designated Partner.
- Passport Size of Proposed New Partner/Designated Partner.
- Signed resignation letter by the existing Partner/Designated Partner, if any
- Details of capital contribution and its distribution among its partners of the LLP after partner change.
- Digital Signature (DSC) of any one of the Designated Partner of the LLP.