Summary of the upcoming key changes impacting UK Limited Partnerships

13 minute read
19 September 2023


The Economic Crime and Corporate Transparency Bill is now in its final stages of consideration and will introduce some sweeping changes to UK Limited Partnerships. The funds industry will be particularly impacted by the reforms, as Limited Partnerships have been the vehicle of choice for many years, and also real estate property holding structures.

The new changes are designed to tackle the abuse that some Limited Partnerships have been subject to (including fraud and money laundering). In this article, we provide an overview of the upcoming key changes, which focus on strengthening the transparency requirements and the reliability of published information, and enabling Limited Partnerships to be deregistered.

The key changes proposed are:

  1. Tightening of registration requirements
    • General partners to nominate a registered officer

      A general partner (GP) that is a legal entity must have at least one individual appointed as a 'registered officer' i.e. a named individual with whom Companies House can make contact.

      The registration application must be supported by statements provided by each proposed GP that is a legal entity, confirming that such registered officer is an individual who is one of the GP's "managing officers", and is not disqualified from acting as a director. There are additional requirements if there are corporate managing officers.

      The identity of the registered officer will be subject to verification, and any changes to the registered officer will need to be notified to the Registrar with confirmation that they meet all of the requirements.
    • Email address

      An application for registration must specify the intended email address of the Limited Partnership, which must be an "appropriate email address". An email address is an "appropriate email address" if, in the ordinary course of events, emails sent to it by the Registrar would be expected to come to the attention of a person acting on behalf of the Limited Partnership. All existing Limited Partnerships will have to provide the Registrar with an "appropriate email address" within a yet to be specified transitional period.
    • Verification

      The reforms also introduce identity verification of those delivering documents to the Registrar (and require confirmation of the identity of certain key persons), which is designed to improve the accuracy of the Companies House data.

      An individual's identity is verified if the individual's identity is verified by the Registrar (in accordance with regulations that are yet to be published); or if a verification statement in respect of the individual has been delivered to the Registrar. A verification statement is a statement by an authorised corporate service provider (ACSP) (see further information below) confirming that it has verified an individual's identity in accordance with the regulations.

      The Registrar will have new powers to check, remove or decline information submitted to, or already on, the Companies House register.
  2. Require Limited Partnerships to maintain connection to the UK

    A Limited Partnership will need to have a registered office in the UK. The GP will have a duty to ensure that the Limited Partnership's registered office is, at all times, at an "appropriate address" at which to receive correspondence. This "appropriate address" may be the Limited Partnership's principal place of business, the residential address or registered office of the GP, or an address of an ACSP. In each case, it must be in the part of the UK in which the Limited Partnership is registered, and must always stay in the original jurisdiction of registration. This could cause issues for existing Limited Partnerships that have migrated to another jurisdiction and will now need to make adjustments to meet the new requirements.
  3. Increase transparency requirements
    • Partner information

      Existing Limited Partnerships will have to provide the "required information" about each partner (both current and those who were a partner on the registration of the Limited Partnership) to the Registrar. The "required information" is,
      • where the partner is an individual: (1) name, date of birth and nationality; (2) any relevant former names; (3) usual residential address; (4) the part of the UK in which the individual is usually resident or, if the individual is usually resident in a country or state outside the UK, that country or state; and (5) in the case of a GP, a service address (which may be stated as "The limited partnership's registered office").
      • where the partner is a legal entity: (1) name; (2) principal office; (3) a service address (which may be stated as "The limited partnership's registered office"); (4) the legal form of the entity and the law by which it is governed; and (5) in the case of a GP, any register in which the GP is entered and, if applicable, its registration number in that register.

      This information must be provided within six months of commencement of the relevant provision. Failure to comply with this is, in the absence of any evidence to the contrary, to be treated by the Registrar as reasonable cause to believe that the Limited Partnership has been dissolved.

      Notice must be given to the Registrar if a person becomes a limited partner or a general partner (and GPs cannot take part in the management of the business until they are so registered), or ceases to be so, and if there are any changes to the required information about any partner.

    • Annual confirmation statements

      An English Limited Partnership will have to provide an annual confirmation statement to Companies House within 14 days of each review period, to confirm that all the information on the register is correct, and deliver any necessary updates. Scottish Limited Partnerships are already subject to this requirement.
  4. Dissolution and new power for the Registrar to deregister Limited Partnerships
    • The right of GPs and Limited Partners to dissolve a Limited Partnership

      If a Limited Partnership is dissolved when there is at least one GP, the GP(s) will be able to wind it up, subject to agreement between the partners. However, if a Limited Partnership is dissolved when there is no GP (for example, where a GP has been removed in accordance with the provisions of a limited partnership agreement), the limited partners must appoint a third party to wind up the Limited Partnership. Limited partners can make this appointment without compromising their limited liability by participating in management of the Limited Partnership's business.

      In either case, the partners would need to notify Companies House of the dissolution. The GP or, in cases where there is no GP, the limited partners, must notify Companies House of the dissolution (and may be guilty of an offence if they fail to do so).
    • Power of the Registrar to remove Limited Partnerships from the register

      The Registrar will be required to remove a Limited Partnership from the index of names as soon as practicable following dissolution or deregistration. The Registrar must place a note in the register of limited partnerships when a limited partnership is so removed and publish a notice in the Gazette in certain circumstances.

      The Registrar will also be able to confirm the dissolution of a Limited Partnership that the Registrar has reasonable cause to believe has been dissolved. This enables the Registrar to ensure that the register is kept up to date and to remove any Limited Partnerships that they either know or suspect are inactive.

      The process involves the Registrar publishing a warning notice stating that it is believed the Limited Partnership is dissolved, inviting any information to the contrary and sending a copy of the notice to the Limited Partnership and GP. At least two months after the publication of the warning notice, the Registrar may publish a dissolution notice; at which point, the Limited Partnership will be automatically dissolved if dissolution has not already occurred.

      The Registrar's obligation to keep the Limited Partnership on the index of names of limited partnerships will cease. There will also be a new court process available in certain circumstances to revive a Limited Partnership that has been dissolved.
    • Voluntary deregistration

      A Limited Partnership will be able to apply to be removed from the register if all partners agree, but this is likely to cause the Limited Partnership to revert any ongoing relationship into a general partnership and hence would require some careful consideration.
  5. Filing documents at Companies House will require the use of an ACSP

    Most filings to be made to Companies House on behalf of a Limited Partnership will need to be made by an ACSP or an employee of an ACSP. This includes:
    • applications for registration;
    • changes of registered office/email address;
    • changes to officers of GPs;
    • changes relating to partners, other changes in the partnership; and
    • confirmation statements.
    These filings cannot be made by an individual on their own behalf.

    The documents being filed must be accompanied by a statement that the individual doing the filing is either an ACSP or an officer or employee of an ACSP, and that they are delivering the documents on behalf of the Limited Partnership.
  6. HMRC will have powers to obtain a copy of the partnership accounts

    A new section 10G LPA 1907 will give HMRC the power to obtain a Limited Partnership's accounts on written notice. There is, however, no new requirement for Limited Partnerships to file accounts at Companies House for public viewing. The law in relation to the filing of accounts will remain the same.

The above changes will apply to existing Limited Partnerships as well as those that are newly formed. It is important that GPs and fund managers review existing structures to ensure that they will be compliant.

What's next?

Once the Bill receives Royal Assent, and passes into law, there is a proposed six-month transitional period, following which all UK Limited Partnerships must comply with the new requirements.

There are strict penalties for failure to comply, such as fines or prison sentences in some cases.

Further background to the Bill

The Economic Crime and Corporate Transparency Bill was introduced in September 2022 and follows on from the Economic Crime (Transparency and Enforcement) Act, which was passed on 15 March 2022. The Bill is expected to become law before the end of this year.

Further detail can be found in the following links:

UPDATE: The Bill received Royal Assent on 26th October and we now await the necessary secondary legislation to bring the provisions of the Act into effect. For further details of how the legislation will impact on entities generally, please see our article Get Ready for Reform: The Economic Crime and Corporate Transparency Bill.

If you would like to discuss these planned changes and how they will impact your business, please contact Sharon Ayres or your usual Gowling WLG contact.

NOT LEGAL ADVICE. Information made available on this website in any form is for information purposes only. It is not, and should not be taken as, legal advice. You should not rely on, or take or fail to take any action based upon this information. Never disregard professional legal advice or delay in seeking legal advice because of something you have read on this website. Gowling WLG professionals will be pleased to discuss resolutions to specific legal concerns you may have.