LLP Agreement Change Service

Starting from ₹2,000 + GST

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Table Of Content

  1. LLP Agreement Change
  2. Benefits of LLP Agreement Change
  3. Eligibility for LLP Agreement Change
  4. Process for LLP Agreement Change
  5. Documents Required for LLP Agreement Change
  6. FAQs
  7. Get in Touch with us

LLP Agreement Change

Changes within a Limited Liability Partnership (LLP) are essential to ensure the partnership remains aligned with evolving goals and operational needs. Updating the LLP Agreement—a legal document that defines the structure, roles, and operational rules of the partnership—is a crucial step to ensure the partnership adapts effectively to these changes.

An LLP Agreement Change, also referred to as an amendment of the LLP Agreement, involves revising the terms originally agreed upon by the partners. These updates may include adjustments to capital contributions, changes in profit-sharing ratios, the addition or removal of partners, or updates to roles and responsibilities to align with current business goals.

Benefits of LLP Agreement Change

Clearly defined roles, profit-sharing ratios, and responsibilities foster smoother collaboration among partners
Updating the LLP Agreement ensures adherence to regulatory requirements, avoiding penalties and legal consequences
A revised LLP Agreement allows the partnership to adapt to new business strategies, growth opportunities, or changing market conditions
Maintaining a compliant and well-documented agreement boosts credibility with stakeholders, including investors and clients, aiding business expansion and trust-building

Eligibility for LLP Agreement Change

  • The LLP must be a registered entity
  • A partner consent letter is required
  • The LLP must have a compliant record
  • Documents must be filed with the Registrar of Companies (RoC)

    • Process for LLP Agreement Change

    Step 1

    Hold a meeting of partners to discuss and agree upon the proposed changes. Unanimous consent is typically required for amendments.

    Step 2

    Prepare the draft incorporating the proposed changes. Clearly specify modifications, such as new roles or revised profit-sharing ratios.

    Step 3

    Pass a formal resolution approving the changes. Document the resolution and obtain signatures from all designated partners.

    Step 4

    Submit Form 3 to the Ministry of Corporate Affairs (MCA) within 30 days of passing the resolution. Include details of the changes made in the LLP Agreement.

    Step 5

    If there are additions or resignations of partners, submit Form 4 alongside Form 3. Attach consent letters from incoming or outgoing partners.

    Step 6

    Pay the prescribed fees as per the MCA’s fee structure. Ensure timely payment to avoid penalties for late filing.

    Step 7

    The RoC will review the forms and attached documents. Once approved, the amendments become legally enforceable.

    Documents Required for LLP Agreement Change

    Original LLP Agreement
    Draft of the Amended LLP Agreement
    Form 3 (Details of amendments)
    Form 4 (For partner changes)
    Digital Signatures of designated partners
    Identity proof of partners
    Payment evidence for fees

    FAQs

    What is the LLP Agreement?

    The LLP Agreement defines the rights, obligations, profit-sharing ratios, and operational rules for the partnership.

    When does an LLP Agreement need to be altered?

    Alterations are needed for changes in business objectives, partner additions or exits, or revised profit-sharing ratios.

    What forms are required for an LLP Agreement change?
    • Form 3: Mandatory for all changes.
    • Form 4: Required for partner addition or removal.
    Are changes permissible without notifying the MCA?

    No, all alterations must be filed with the MCA to be legally effective.

    When should Form 3 be filed?

    It must be filed within 30 days of passing the resolution for changes.

    What happens if Form 3 is filed late?

    A penalty is imposed for late filing, with the amount increasing based on the delay.

    Can a single partner make changes to the LLP Agreement?

    No, unanimous consent from all partners is required unless the agreement specifies otherwise.

    Are there government fees for LLP Agreement amendments?

    Yes, fees vary based on the LLP’s capital structure.

    Can a third party be included in the LLP Agreement?

    No, the LLP Agreement applies exclusively to registered partners.

    How long is the amended LLP Agreement valid?

    The amended agreement remains valid until further modifications are made.

    Do changes require approval from external authorities?

    Apart from the RoC, no external approvals are generally required.

    Can the LLP change its name through an agreement amendment?

    No, a name change requires a separate procedure involving Form 5.

    What if a partner disagrees with the proposed changes?

    Changes cannot be implemented without unanimous consent, unless otherwise stated in the existing agreement.

    Is professional help necessary for LLP Agreement changes?

    While not mandatory, professional guidance ensures accurate filing and compliance with legal requirements.

    Can operational flexibility increase after LLP Agreement changes?

    Yes, amendments enable the LLP to adapt to evolving business needs and strategies.

    Is there a penalty for non-compliance?

    Failure to update the agreement or notify the MCA can result in penalties and legal consequences.

    Get in Touch with us

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