Draft Companies (Amendment No. 6) (Jersey) Regulations 201-
(“the draft Regulations”)
1. THE ISSUE AND RECOMMENDATION
1.1. The draft Regulations provide for consequential amendments to the Companies (Jersey) Law 1991 following the coming in to force of the Incorporated Limited Partnerships (Jersey) Law 2011 (“ILP Law”), which will allow for the establishment of a new type of Jersey body corporate, the Incorporated Limited Partnership (“ILP”).
1.2. There are no financial or manpower implications for the States of Jersey.
1.3. It is recommended that the Minister approves the draft Regulations and directs that they be lodged au Greffe for debate by the States at the earliest opportunity.
- BACKGROUND
2.1. The ILP Law was approved by the States on 25 May 2010. When it comes into force, the ILP Law will allow for the establishment of a new type of Jersey vehicle, the Incorporated Limited Liability Partnership (“ILP”).
2.2. An ILP will be a body corporate, having perpetual succession. This may be attractive for a number of reasons. Firstly, there may be an attraction to having body corporate status for those engaging in cross-border transactions, since this gives greater certainty as a matter of international law, in particular regarding the limited liability of the limited partners. Secondly, perpetual succession means that those dealing with the ILP can be confident that it will continue to exist and be held accountable for its obligations.
The draft Regulations
2.3. The ILP Law follows the Limited Partnership model and provides that to the extent that matters are not expressly provided for in the ILP Law, the customary law of partnership will apply to ILPs. However, because the ILP will be an incorporated body, consequential amendments are needed to the Companies (Jersey) Law 1991 to clarify the extent of its applications to ILPs.
2.4. In brief, the draft Regulations will remove ILPs from the definition of a ‘body corporate’ for the purposes of the application of the Companies Law, just as Limited Liability Partnerships (LLPs) are excluded currently.
2.5. In keeping with current policy, neither an ILP nor a separate limited partnership (“SLP”) formed under the Separate Limited Partnerships (Jersey) Law 2011 (“SLP Law”) can be an auditor or director of a Jersey company.
2.6. The Regulations are expressed to come into force 7 days after they are made.
- RECOMMENDATION
3.1. It is recommended that the Minister approves the draft Regulations and directs that they be lodged au Greffe for debate by the States at the earliest opportunity.
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