# Presentation: 345078

## Partnerships in China

- -----New partnership law

##   1. Brief introduction

New partnership law was passed  by Standing Committee of NPC in August,2006
Character of New law
     ----include LP and LLP

**New partnership law was passed  by Standing Committee of NPC in August,2006**
**Character of New law**
**     **----include LP and LLP

##      ----partners: individual, legal person,and other entities. 
     ----no separate tax imposed on partnership entity
     ----apply to foreigners

Encourage investment,deregulation,
Contractual flexibility,  improve efficiency

-      ----no separate tax imposed on partnership entity
-      ----apply to foreigners
**Encourage investment,deregulation,**
**Contractual flexibility,  improve efficiency**
**  **

##     2. Types of firms

Stock Companies
Close corporation
General partnership
Limited partnership(LP)
Limited liability partnership(LLP)

**Stock Companies**
**Close corporation**
**General partnership**
**Limited partnership(LP)**
**Limited liability partnership(LLP)**
**    **

## Foreign enterprises

    ----Sino-foreign Equity JV
    ----Sino-foreign cooperative
    ----Foreign-owned enterprises
    ----FI joint stock limited companies

**    **----Sino-foreign Equity JV
-     ----Sino-foreign cooperative
-     ----Foreign-owned enterprises
-     ----FI joint stock limited companies

##     3. General Partnership

For small and professional firms,  simple structure
Partner may invest in service
General partnership has to make registration.

**For small and professional firms,  simple structure**
**Partner may invest in service**
**General partnership has to make registration.**

## 
Indicate “GP”in the title of the entity
Partners have to have full capacity for civil conduct when the partnership set up
Partners equally share profits, losses and controls

**Indicate “GP”in the title of the entity**
**Partners have to have full capacity for civil conduct when the partnership set up**
**Partners equally share profits, losses and controls**
** **

## 
Partners are not permitted to request for distribution of the property before the liquidation
Partnership’s debts.
    ---- general provision
    ---- Partners’ admission and withdrawal 
    ---- disbandment

**Partners are not permitted to request for distribution of the property before the liquidation**
**Partnership’s debts.**
**    **---- general provision
-     ---- Partners’ admission and withdrawal
-     ---- disbandment

##      4. Special General Partnership(LLP)

Only apply to professional entities
Partners’ personally liable for business debts
    ----tort, wrongdoing
Measures of replaceable remedies

**Only apply to professional entities**
**Partners’ personally liable for business debts**
**    **----tort, wrongdoing
**Measures of replaceable remedies**
** **

##     5. Limited partnership(LP)

Limited liability for passive limited partners
How many partners are permitted in the business?
“LP” in title
Limited partner’s duty to make contribution,not permitted to contribute in service

**Limited liability for passive limited partners**
**How many partners are permitted in the business?**
**“****LP” in title**
**Limited partner’s duty to make contribution,not permitted to contribute in service**

## Limited partner does not participate in management
 LP’s debts.
    ----general provision: limited partners liable if participate in management
    ----limited partners’admission and withdrawal 
    ----disbandment
Useful for venture capital funds

** ****LP’s debts.**
**    **----general provision: limited partners liable if participate in management
-     ----limited partners’admission and withdrawal
-     ----disbandment
**Useful for venture capital funds**

##    6. Bankruptcy  

   7. Apply to foreigners 

-    **7. Apply to foreigners **