The foundation of the business is mostly well-written & detailed Limited Liability Partnership (LLP) agreement. The comprehensive and detailed agreement of the Limited Liability Partnership makes a company’s responsibilities simple and clear. This agreement is the formal contract that unites the partners. The sample format of LLP Agreement mostly mentions each partner’s rights and responsibilities towards the business and each another.

The Limited Liability Partnership Act requires the company to register with an Limited Liability Partnership agreement that is filed no later than 30 days after the Limited Liability Partnership is established. If there is no formal agreement, the partners and the LLP will be subject to all of the rights and duties under Schedule I of the act.

What is a LLP Agreement?

• A Limited Liability Partnership agreement is an important legal document that describes the partner’s rights and duties during LLP registration. 
• It contains information on capital contributions, sharing of profits, decision-making procedures, management structure, & provisions for the partner’s appointment or termination. 
• It should be completed in between 30 days of the incorporation of the LLP.

Features of a LLP Agreement

The following are the features of an LLP that set it apart from other business structures:

• LLPs are formed for the purpose of doing legal business.
• An LLP is a corporate entity that is separate legally from its partners and has a permanent succession plan. Partner’s change or alteration of the LLP has no bearing on the rights and responsibilities in the company.
• Real estate can be bought, owned, developed, or sold by LLP.
• LLP is the body corporate, to bring legal action, to be sued, to possess a common seal, and to take other legal acts.
• All LLP-related liabilities are paid out from its assets.

Contents of an LLP Agreement

An Limited Liability Partnership agreement must have the following contents in it:

• Name of the LLP: The agreement should include the LLP’s name at the top. The Registrar must check the name upon review of the Form 1 application.

• Date and Location of Execution: The agreement must mention the Date and Location of Execution from the outset.
• Information about Partners: Each partner’s name, father’s name, and address has to be mentioned separately.
• Mention LLP’s registered office address: Make sure to provide the LLP’s registered office address. It should be the same address that was already provided whenever the incorporation of the LLP was done.
• Introductory Provisions: Definitions of the technical terms that us used in the agreement are usually included in this provision. Additionally, the partner’s details, etc., are to be mentioned.
• Objective to be Mentioned: All the goals of the Limited Liability Partnership that are important must be expressly stated in the LLP agreement.
• Contribution of Capital: Every partner’s capital contribution must be expressly stated in the agreement. Along with the amount of gift, nature of such contribution has to be mentioned.
• All Relevant Information: This LLP agreement has to mention all the important and relevant information on the partner’s appointment, removal, termination, rights, duties, etc.
• Names of Designated Partners & Details: The agreement should have the names of the designated partners & important details about their appointment, removal, termination, etc., including their rights, responsibilities, etc.
• Compensation & Profit-Sharing Provision: This provision should be mentioned, with unambiguous inclusion of all pertinent information.
• Accounting & Documentation: This is the clause that includes and outlines the LLP bookkeeping requirements & the accounting and the documentation requirements.
• Winding up: A winding-up clause that outlines the process to be followed in the situation wherein the partners make a decision to dissolve the company has to get included.
• Additional Clauses: In addition to the contents that is listed above, they can add any important clause that they agree upon and that is allowed under the law.

Do an LLP Agreement Needs to Get Registered?

• Within 30 days of the incorporation of the LLP, the LLP Agreement needs to be completed and registered according to Section 23 of the Act. 
• Each LLP agreement has to be signed on the appropriate size stamp paper, which is mostly determined by the contribution amount & the state in which the registered office is located. 
• The agreement needs to get properly signed by all parties and notarized by the officials to meet the requirements of the stamp duty.
• The aforementioned LLP Agreement needs to get submitted in Form 3 to the registrar in the given time, and the liability of it extends beyond its completion.

How LLP Agreement is Executed?

• You must ensure to carefully draft the agreement and include all the relevant before printing it on Stamp Paper of Requisite Value. The LLP agreement’s stamp duty amount relies upon the state of incorporation & the partner’s capital contribution made.
• It is mandatory for each and every partner to sign and finalize the LLP Agreement in the company.
• The last page of the company’s agreement shall include the signatures of witnesses on behalf of the parties.
• Thereupon this LLP agreement will get notarized by the officials.
• The e-copies of this agreement should be filed with the Registrar of Companies (ROC) in a proper time window of 30 days from the incorporation date of the LLP.
• Each partner should have the photocopy of the Limited Liability Partnership agreement.

Filing Process of LLP Agreement

This is a quick idea of the filing process:

• Go to the MCA’s main page.
• Enter your credentials and log in.
• Choose “MCA services” and then “E-Filing.”
• From the list of options there, choose “LLP Forms Download”.
• Choose “Filing of LLP agreement/ Requests of any change in the LLP agreement.”
• Enter the LLP data that is asked.
• Fill out the application completely.
• Complete the forms that are inter-connected, if applicable.
• Send in the webform.
• After a successful submission, a Service Request Number (SRN) will be produced.
• Upload the PDF file to the MCA portal along with the Digital Signature Certificate (DSC) attached.
• Make the necessary fee payments.
• You will receive a slip that will be produced after the completion of the process.

After Form 3 is submitted, the LLP Agreement needs to get recorded on stamp paper. The amount of filing will vary.

Conclusion

All things considered; the Limited Liability Partnership agreement is the cornerstone of a successful business. This meticulously crafted and legally valid contract states the respective right and duties to be followed by each of the partner. It provides a clear understanding of the contents and stop future disputes. The default requirements contained in Schedule I of the LLP Act 2008, which are applicable to partners neglecting to register an Limited Liability Partnership agreement, emphasize the necessity of validating the LLP agreement. Ensuring regulatory compliance & organizational transparency requires conforming to the conditions of the Limited Liability Partnership agreement, which includes maintaining important documents, etc.

Furthermore, the Limited Liability Partnership agreement mostly promotes stability & growth for streamlining business operations by establishing the clear guidelines for proper decision-making & conflict resolution. Ultimately, the Limited Liability Partnership agreement is a tool to protect the partner’s interests, increase their operational efficiency, etc for the long-term expansion of the business.