Consultation Paper No.23 on Limited Partnership Law
THIS DRAFT LAW IS PUBLISHED FOR CONSULTATION PURPOSES ONLY. THE DIFCA AND THE DFSA RESERVE THE RIGHT TO AMEND THIS DRAFT AT THEIR SOLE DISCRETION.
SUMMARY OF THE LAW
This part provides articles of general application such as administration of the Law and application of the Collective Investment Law to limited partnerships.
This part provides for the definition and constitution of a limited partnership and requires all limited partnerships that wish to conduct business in the DIFC to register with the Registrar by way of a declaration. Article 12 provides a list of information which is required to be disclosed in the declaration.
This part requires limited partnerships to have at all times a registered office in the DIFC and to maintain a register in the manner prescribed by legislation. All limited partnerships have to maintain accounts which disclose accurately the financial position of the Limited Partnership. There is no requirement for Limited Partnerships to be audited.
This part deals with general provisions relating to the limited partnership such as legal personality, power of a general partner to bind the partnership and use of partnership property. Article 27 deals with the assignment of interest by a limited partner and prescribed the manner in which such assignment is to take place.
This part deals wit the rights and liabilities of general and limited partners, how profits are to be shared, and the manner in which the contribution of a limited partner can be returned. Specifically article 34 provides that a limited partner is not liable for the debts or obligations of the limited partnership unless he participates in the management of the partnership.
This part deals with the manner in which a limited partnership can be dissolved. Article 36 requires a statement of dissolution signed by the general partner before a limited partnership can be dissolved. In addition on death, bankruptcy, legal incapacity, retirement or withdrawal of the last remaining general partner the partnership is immediately dissolved unless the limited partners appoint a new general partner in the manner specified in Article 38. Article 39 provides certain powers to the Court in respect of dissolution of a limited partnership.
This part deals with who can bring legal proceedings against a limited partnership and the manner in which such proceedings can brought. Article 42 deals with enforcement of judgments and states that no judgment shall be enforced against any property of a Limited Partnership unless such judgment has been granted against a general partner in his or her capacity as a general partner of that Limited Partnership.
This part deals with the recognition of foreign limited partnerships wishing to carry on business in the DFC and provides for registration requirements for such limited partnerships.
This part deals with the concept of general contravention and the imposition of administrative fines under the Law.
This part deals with the powers of the Registrar. For example, Article 49 states that the Registrar may appoint one or more inspectors to inspect the business of a limited partnership. The Registrar must inform the DFSA if he exercises this power with respect to limited partnerships which are either licensed or registered by the DFSA. Article 53 allows the Registrar to issue directions to any person to comply with the Law or the Regulations made under the Law. A person who is aggrieved by a decision of the Registrar can make an application to the Court seeking an order as prescribed in Article 56.
This part deals with the migration of limited partnerships to and from the DIFC without having to dissolve provided that the laws of both jurisdictions allow for such a migration. Limited partnerships that wish to migrate to and be continued in the DIFC or another jurisdiction must do so in accordance with the relevant laws and any rules made under such laws.
This part deals with miscellaneous matters such as the power of the Board of Directors of the DIFC Authority to make Regulations and the duty of the Registrar to establish and maintain a public register of current and past registrations.
SUBMISSION OF COMMENTS
The draft Law is published for consultation purposes only jointly by the DIFCA and the DFSA. Please note, that although the draft is in near final form, the DIFCA and the DFSA reserve the right to amend the draft at their sole discretion and as it is still “work in progress” it may therefore undergo further amendments prior to enactment.
Any persons wishing to submit comments should, where applicable, provide details of the organisations they represent. In addition, persons suggesting alternative approaches are encouraged to submit the proposed text of possible amendments that would be necessary to incorporate their suggestions.
Please note that the names of the commentators and the content of their submissions may be published on the DIFCA or the DFSA Websites and in other documents to be published by the DIFCA or the DFSA. If you wish your name to be withheld from publication, please indicate this when you make your submission.
Any comments should be addressed to:
Chief Legal Officer
PO Box 74777
or e-mailed to email@example.com
PO Box 75850
or e-mailed to firstname.lastname@example.org
All comments should be provided in writing, on or before 19 February 2006.
DUBAI FINANCIAL SERVICES AUTHORITY
20 January 2006