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Limited liability partnerships uses in venture capital structures

In a typical limited partnership fund structure, a company will be the general partner of the limited partnership fund, which will contract to receive management supplies from a management company. But there are a number of reasons why private equity firms should consider whether it may be more tax efficient to use an LLP instead of a company to carry out the management function, according to SJ Berwin.

There are both advantages and disadvantages to adopting an LLP structure, and anyone considering whether to go down this route would need to analyse all the relevant factors by reference to their own individual circumstances. The decision will be a finely balanced one and will depend on a range of factors, including the extent to which the executives involved in management are to share incentive arrangements.

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SJ Berwin is a pan-European law firm with a particular focus on private equity. It has offices in London, Frankfurt, Munich, Berlin, Madrid, Paris and Brussels. If you would like further information on our services to the private equity industry please contact Jonathan Blake or Simon Witney in our London office 020 7533 2222 or visit our website at www.sjberwin.com.