Start up a Limited Liability Partnership in Malaysia

  • What is Limited Liability Partnership (LLP)?

    Limited Liability Partnership (LLP) is an alternative business vehicle in Malaysia, which has a combination characteristics of a company and conventional partnership. LLP is regulated under the Limited Liability Partnerships Act 2012. The main highlight of LLP is it offering limited liability to LLP partners in Malaysia and have flexibility in internal management.

  • Characteristic of LLP

    • LLP is a business entity with body corporate status which has a legal personality separate from its partners. Normally, we called it as separate legal entity status from its partners.
    • LLP may do and suffer acts and things as bodies corporate may lawfully do and suffer.
    • LLP can sue and/or be sued and able to acquire, own and hold property.
    • LLP has perpetual succession.
    • Changes in matters relating to partners will not affect the existence, rights or liabilities of the LLP.
    • LLP has less statutory compliance requirements and lower maintenance costs as compared to a private limited company.
  • Who can set up LLP?

    The LLP business structure is designed for all lawful business purposes with a view to making a profit. LLP may also be formed by professionals such as Lawyers, Chartered Accountants and Company Secretaries for the purpose of carrying on their professional practice. The LLP concept will also support start-ups, small and medium enterprises (SMEs) to grow their businesses without having to worry too much about their personal liabilities, personal assets and strict compliance requirements.

    Precisely, LLP is suitable for the following business groups to carry on their business:

    • Professionals (Lawyers, Accountants & Company Secretaries)
    • Small & Medium Enterprises
    • Joint ventures
    • Venture capitals
  • Significant features of LLP

    LLP is featured with the protection of limited liability to its partners similar to the limited liability enjoyed by shareholders of a company coupled with the flexibility of internal business regulation through partnership arrangement similar to a conventional partnership.

    Any debts and obligations of the LLP will be borne by the assets of the LLP and not that of its partners. An LLP has the legal status of a body corporate which is capable of suing and being sued in its own name, holding assets and doing such other acts and things in its name as bodies corporate may lawfully do and suffer.

    LLP also offers flexibility in terms of its formation, maintenance and termination while simultaneously has the necessary dynamics and appeal to be able to compete domestically and internationally. With the introduction of LLP, entrepreneurs will have more options to choose the most preferred form of business vehicle.

  • Formation of LLP

    LLP can be formed with at least 2 parties from the following composition:

    • by two individual persons; or
    • by one individual person and one body corporate; or
    • by two bodies corporate.

To learn more about Malaysia LLP Company Registration

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