SECP allows LLPs to file appeals with Appellate Bench

Securities and Exchange Commission of Pakistan (SECP) has decided to allow Limited Liability Partnerships (LLPs) to file appeals against the commission with the SECP Appellate Bench where registrations of LLPs are refused. According to the draft Limited Liability Partnership Regulations, 2018 issued here on Wednesday by the SECP, in case the registration of LLP is refused, the applicant may file an appeal to the Appellate Bench of the Commission within sixty days of the date of decision.
Conversion from firm to limited liability partnership: The application for conversion from firm to a LLP shall be filed as per LLP-Form-VI [Part I] in terms of requirements specified in Second Schedule of the Act subject to compliance with all the requirements regarding incorporation of LLP and payment of fee as per Fee Schedule of these regulations. The registrar on being satisfied with the application, shall register the LLP and issue a certificate of Incorporation as per LLP-Annexure-II.
Conversion from private limited company to limited liability partnership: The application for conversion from private limited company to a LLP shall be filed as per LLP Form-VI [Part II] in terms of requirements as specified in the third Schedule of the Act subject to payment of fee as per Fee Schedule of these regulations. The registrar on being satisfied with the application, shall register the LLP and issue a Certificate of Incorporation as per LLP-Annexure-II.
The applicant shall make an application to the registrar as per LLP-Form-III either online or in physical form for incorporation of LLP along with the following documents, - copies of National Identity Card (NIC) of the partners and of designated partners and in case of physical application, of witness to the documents and in case of foreigner, a copy of passport; attested copy of LLP agreement duly executed by the partners, witnessed and notarized; consent of designated partner (if any); In case of physical application, original bank challan evidencing the payment of fee as specified in Fee Schedule; any other information and document as required by the registrar.
The registrar shall examine the incorporation documents submitted for registration of LLP and if satisfied that the same are complete and in conformity with the requirements of the Act and these regulations, shall register the documents.
On registration of incorporation documents, the registrar shall issue certificate of incorporation under his signatures and authenticated by official seal of the Registrar as per LLP-Annexure-II, SECP said.
Every individual who agrees to act as designated partner shall file his prior consent on LLP-Form-IV [Part I] with the LLP and the LLP shall file the particulars of designated partner along with his consent to act as such with the Registrar as per LLP-Form-IV [Part II] within thirty days of the receipt of his consent. A person shall not be capable of being appointed as a designated partner of LLP, if he is a minor; is of unsound mind; is an undischarged insolvent; has applied to be adjudicated as an insolvent and his application is pending; any other disability or disqualification that renders him incapable of performing as designated partner.
A notice in terms of section 14 of the Act to become or cease to be a partner or designated partner as the case may be shall be signed, authenticated under common seal of LLP and filed with the registrar within fifteen days as per LLP-Form-V along with the copy of LLP Agreement and fee as specified in Fee Schedule. The notice concerning admission of new partner as per sub-regulation (1), shall be accompanied by his consent to act as such as per LLP-Form-IV along with a copy of LLP Agreement. A notice in terms of section 14 of the Act for any change in the name or address of a partner or designated partner as the case may be, shall be signed, authenticated under common seal of LLP and filed with the registrar within fifteen days as per LLP-Form-V along with the copy of LLP agreement, if required and fee as specified in Fee Schedule.
The SECP said that the contribution of each partner shall include but not limited to moneys, negotiable instruments, properties including valuable rights, intangibles, knowledge and skills in accordance with the partnership agreement. The respective contribution of each partner may be accounted for in accordance with the partnership agreement and disclosed in the financial statements of the LLP along with nature and value of contribution. The monetary value of contribution of partners representing tangible and intangible properties shall be determined in accordance with the Company law and rules and regulations made there under.
The LLP shall inform the Registrar, the transfer of rights of a partner to share the profits and losses of the LLP and to receive distributions to another person and shall file LLP agreement as per LLP-Form-VIII along with fee as specified in Fee Schedule within seven days of such change.
The SECP said that each LLP shall maintain books of accounts at its registered office relating to its state of affairs for each year of its existence on accrual basis and according to double entry system of accounting. The books of accounts of every LLP relating to a period of not less than ten years immediately proceeding the current year shall be preserved in good order. Every LLP shall prepare its financial statements within a period of four months from the end of each financial year.
Provided that the LLPs as notified by the Commission shall be required to file the financial statements along with the fee with the Registrar.
The books of account shall contain - particulars of all sums of money received and expended by the LLP and the matters in respect of which the receipt and expenditure takes place; a record of the assets and liabilities of the LLP; statements of cost of goods purchased, inventories, work-in- progress, finished goods and cost of goods sold; any other records decided by the partners; and any other particulars as notified by the Commission.
The financial statements of the LLP shall be approved through resolution passed by a majority in number of partners. The financial statements shall be signed on behalf of the limited liability partnership by its designated partner and where the designated partner is not available, these shall be signed by all the partners.
The Commission may provide e-service for the electronic filing or lodging of the application, document or report to be filed under any provision of the Act, Rules made under the Act or under these regulations. A copy of or an extract from any document electronically filed or lodged with the Commission or the registrar or supplied or issued by the Commission or the registrar and certified to be a true copy thereof or extract there from under the hand and seal of an officer of the Commission or the registrar, shall be admissible in evidence in any proceedings as of equal validity as the original document. Where a document is electronically filed or lodged with the Commission or the registrar, the Commission or the registrar shall not be liable for any loss or damage suffered by any person by reason of any error or omission of whatever nature arising or appearing in any document obtained by any person under the e-service referred under these regulations, if such error or omission was made in good faith and in the ordinary course of the discharge of the duties of the Commission or the registrar.
The Commission through notification shall establish offices at such places as deem fit for registration of LLP and performing other duties under the Act and the rules and regulations made there under, the SECP added.