Foreign Limited Liability Partnership, as the name suggests, is a combination of two, LLP Act also governs and regulates foreign LLPs.
The procedure of Foreign LLP Registration
- Reserve the name for foreign LLP by filing Form 25 through MCA which shall be renewed after three years through the same form.
- LLP within 30 days of establishing a principal place of business in India shall file Form 27 to the registrar through MCA for registration of foreign LLP.
- Following documents are required to be annexed with the application form:
- Certificate of incorporation or such other documents defining the constitution of LLP
- Address of the principal place of business in its incorporation country
- Address of the deemed principal place of business
- Details of designated partners
- Contact details of authorized person in India who acts on behalf of foreign LLP
- Registrar upon satisfaction shall issue Certificate of Incorporation to foreign LLP in Form 30.
- If any alteration occurred after that, LLP should file Form 28 informing registrar about such changes:
- Change in the principal place of business
- Alteration in the composition of partners
- Amendments in defining the constitution of LLP
- Details of authorized signatory who acts on behalf of foreign LLP
Post Registration Requirement
- Foreign LLP shall file Statement of Solvency with the registrar in Form 8 within 30 days of the end of 6 months of the financial year.
- All documents shall be in English translation. However, if any document is not in English, there shall be annexed a certified translation authenticated by Advocate, Chartered Accountant, Company Secretary or Cost Accountant.
- Foreign LLP shall state its foreign name on every invoice, publications, and notices in legitimate English characters
- If foreign LLP ceases to have its principal place of business in India shall intimate to the registrar within 30 days of such intentions for closure in Form 29
- Every document submitted by Foreign LLP shall be filed to Registrar having jurisdiction over New Delhi through the online portal of Ministry of Corporate Affairs
Requirements for registration of Foreign LLP
- Since it is clear from the pictorial graph that LLP possesses few traits of the Company and a few features of Partnership, so it is a total win-win model for start-ups.
- Following are pre-requisite for registering foreign LLP in India:
- LLP Act 2008 allows 100% FDI including foreign companies and LLPs for incorporation in India. However, partners need to fulfill the relevant Foreign Exchange Rules, Regulations, guidelines of the concerned country
- Incorporation of private limited or LLP in India is the most preferred entry for foreign nationals in India. However, 100% FDI through automatic route is most popular amongst NRIs and foreign nationals.
- Opening of a branch office in India of foreign LLP or company requires prior approval of RBI and is also preferred by foreign nationals to operate in India.
Limitations on LLP and its Partners
- Partner acts as the agent of LLP in which they are the members and not of the other partners
- Acts of partners do not bound LLP if the partners are not authorized to act on behalf of LLP
- LLP is liable for the wrongful acts or omission incurred by its partners during his part of doing business of LLP
- Entire obligations of LLP are its responsibility and not of its partners
- In case of any fraud or willful misrepresentation, LLP and its partners are completely liable.