Partnership in outsourcing
August 7, 2009
Partnership is defined as the relation between two or more persons who have agreed to share the profits of business run by all or any one of them acting for all.
There are three types of partnership in outsourcing.
1. General partnership.
2. Limited partnership.
3. Limited liability limited partnership.
1. General partnership:
- General partnership or partnership is defined as the relation between two or more persons.
- The partners are all personally liable for any legal actions and debts the company may face.
- Partners are created by agreement, proof of existence.
- They may share credits depends person and it could be attached in agreement.
- General partner has an equal right to participate in the management and control of the business.
- If any disagreement between the partners it could separate the majority of partners that could make it as possible.
- If any of them act as misbehavior in the business he will be omitted form the partners by set of rules.
- No one can become a member of the partnership without the consent of all partners
2. Limited partnership:
- Limited partnerships are very different from general partnerships, and are usually set up by companies that invest money in other businesses or real estate.
- While limited partnerships have at least one general partner who controls the company’s day-to-day operations and is personally liable for business debts, they also have passive partners called limited partners.
- A limited partner is one who does not have total responsibility for the debts of the partnership. The most a limited partner can lose is his investment in the business.
- The trade off for this limited liability is a lack of management control: A limited partner does not have the authority to run the business. He is really more or less an investor in the business.
3. Limited liability limited partnership:
- Limited liability limited partnership is a relatively new modification of limited partnership, a form of business entity recognized by U.S commercial law.
- Limited liability limited partnership is combination of general partnership and limited partnership.
- In an LLLP, by having the limited partnership make an election under state law, the general partners are afforded limited liability for the debts and obligations of the limited partnership that arise during the period that the LLLP election is in place.
- LLLP are most common in the real estate business, although other businesses can use the form as well.
- LLLP is so new; it is not widely used.