What is LLP?

LLP is an evolved version of a normal partnership firm, where liabilities on partners are limited. It is governed under the LLP Act 2008 And MCA handles its registrations and governance. In LLP, a minimum of two partners should be there but there is no upper cap on the maximum number of partners.

Designated Partner

An individual chosen by the LLP's partners to supervise administration and assure compliance to legal requirements is known as a designated partner. Similar to a director in a business, this role promotes control by management over pure ownership.

Key Responsibilities

  • Regulatory Compliance: They are first primarily responsible for ensuring that the LLP adheres to all legal compliance requirements, including timely filing of annual returns, financial statements, and other necessary documents with the Registrar of Companies.
  • Partnership Agreement Enforcement: They ensure adherence to the LLP agreement, which outlines the rights and responsibilities of all partners.
  • Financial Record Maintenance: Designated partners are also responsible for maintaining and ensuring transparency in financial dealings within the LLP.
  • : Mainly actively participate in key decision-making processes regarding business goals, financial matters, and overall direction for growth and development.

Qualifications for Designated Partners

  1. Person Status: Designated partners must be individuals. They can also be partners in the LLP, but at least one designated partner must be a resident of India.
  2. Minimum Age: The Person must be at least 18 years old.
  3. DPIN Requirement: Must possess a valid DIN

Disqualifications from Becoming a Designated Partner

  1. Minors: Persons below 18 years of age cannot qualify as designated partners
  2. Mentally Unsoundness: If a person is declared unsound mind by a court, with the declaration still in force
  3. Criminal Case: Person convicted of an offense involving moral turpitude and sentenced to imprisonment for six months or more within the last five years are disqualified.

Appointment of Designated Partner in LLP

The Superb thing about LLPs is that can add or remove partners whenever it's needed. However, the designated partner should be made fully knowledge of his roles and responsibilities before adding him to the LLP. The necessary steps to add a partner in an LLP are mentioned below:

1.  LLP Agreement Review:

  • First by reviewing the LLP agreement by understand the specific provisions related to appointment of designated partners. This document covers the rights and responsibilities of partners and may contain special procedures for appointments.

2. Identify an Eligible Person:

  • Secondly a suitable person for the role of designated partner, ensuring that they meet the eligibility criteria setup in the LLP Act, such as being an individual and at least one designated partner must be a resident of India.

3.Must obtain Digital Signature Certificate (DSC):

 4.Acquire (DIN) for Designated Partner:

  • The person must apply for a Designated Partner Identification Number (DPIN) from the Central Government. That includes submitting Form DIR-3 along with required documents like identity proof and address proof

5. Consent approval from the nominated Designated Partner:

  • The Nominated Person must give written consent to act as a designated partner. This consent is important for formalizing their role within the LLP.

6. Conduct a Meeting of Existing Partners:

  • A meeting with existing partners to pass a resolution approving the appointment of the new designated partner. Document this meeting in the minutes, including details such as the name and DIN of the new partner.

7.  Forms to file with ROC:

  • Within 30 days of the appointment designated partner, file Form-3 (addendum in the agreement) and Form -4 (appointment of designated partners) with the ROC. Delays in filing these forms can incur penalties.

8. Amendment in LLP Agreement:

  • Amend the LLP agreement to reflect the addition added of the new designated partner, ensuring that all roles, responsibilities, and profit-sharing arrangements are clearly mentioned.

9. Approval by MCA:

  • The Ministry of Corporate Affairs (MCA) will have to review all submitted documents and forms to ensure compliance with legal standards. Once satisfactory review, they will approve the appointment.

10. Confirmation of Appointment:

  • At last, after receiving approval from MCA, verify that the new designated partner's name has been officially being added to the records on the MCA website, allowing them to commence their duties within the LLP.

 Conclusion
Designated partners are essential to an LLP's efficient administration and compliance to the law. By bridging the ownership and management separate, they ensure the enforcement of legal requirements as well as operational effectiveness. Protecting the interests of the LLP and its partners requires this function.

   Why Choose Corpzo?
    Here are key reasons to select Corpzo for adding a designated partner to your LLP:

  • Expert Assistance: Our knowledgeable team facilitates the service request process for you.
  • Clear Guidance: We provide a simplified checklist of required documents to clarify misunderstandings.
  • Timely Updates: We ensure you’re informed throughout the verification process.
  • Proactive Communication: Our team is transparent and will promptly contact you in case of any urgent matters.

Choose Corpzo for a streamlined and efficient LLP management experience.