The Ministry of Corporate Affairs (“Ministry”) has notified the Limited Liability Partnership (Signification Beneficial Owners) Rules, 2023 (“2023 Rules”). The 2023 Rules have gained effect since 9th November, 2023. These Rules are applicable to all Limited Liability Partnerships (“LLPs”) and mandate LLPs to proactively identify individuals qualifying as ‘significant beneficial owner’ in connection with the LLP and upon identification, facilitate the submission of declaration in prescribed Forms, maintain register of significant beneficial owners and issue notices seeking information in alignment with section 90 of the Companies Act, 2013.
Key Compliance Obligations:
A. Duty of Reporting Limited Liability Partnerships:
• Reporting Limited Liability Partnerships (“LLP”) are required to identify any significant beneficial owner in relation to that LLP and obtain declaration(s) from such individuals in Form No. LLP BEN-1.
• In the event partners of LLP hold at least than 10% of its:
a. Contribution or,
b. Voting rights or,
c. Right to receive or participate in the distributable profits or any other distribution payable in a financial year,
every LLP is required to give notice to such partner in Form LLP BEN-4.
B. Declaration of Significant Beneficial Ownership :
Every individual who is a significant beneficial owner in a reporting LLP is required to file a declaration in Form No. LLP BEN-1 to the reporting LLP within 90 days of the commencement of 2023 Rules. Further, individuals who subsequently become significant beneficial owners or undergo ownership changes must file a declaration within 30 days of acquiring such ownership or change in Form No. LLP BEN-1.
C. Return of significant beneficial owners in contribution :
On receiving the declaration as mentioned-above, the reporting LLP is required to file a return in Form No. LLP BEN-2 with the Registrar within 30 days from the date of receipt of such declaration along with prescribed fees.
D. Register of significant beneficial owners :
LLPs are required to maintain a register of significant beneficial owners in Form No. LLP BEN-3 which must be kept open for inspection.
E. Filing of notice to seek information :
Every LLP is required to give a notice in Form No. LLP BEN-4 to any person falling under the following categories:
a. Those identified as significant beneficial owners of the LLP.
b. Individuals with knowledge of the identity of a significant beneficial owner or others likely to possess such information.
c. Persons who have been significant beneficial owners of the LLP within the three years preceding the notice issuance date,
and who is not registered as a significant beneficial owner with the LLP.
Source: Ministry Of Corporate Affairs
