LLP is an alternative corporate business form that gives the benefits of limited liability of a company and the flexibility of a partnership. The LLP can continue its existence irrespective of changes in partners. It is capable of entering into contracts and holding property in its own name. The LLP is a separate legal entity, is liable to the full extent of its assets but liability of the partners is limited to their agreed contribution in the LLP. Further, no partner is liable on account of the independent or un-authorized actions of other partners, thus individual partners are shielded from joint liability created by another partner’s wrongful business decisions or misconduct. Mutual rights and duties of the partners within a LLP are governed by an agreement between the partners or between the partners and the LLP as the case may be. The LLP, however, is not relieved of the liability for its other obligations as a separate entity. Since LLP contains elements of both ‘a corporate structure’ as well as ‘a partnership firm structure’ LLP is called a hybrid between a company and a partnership.

Company Registration in Australia |

Q: Structure of LLP

LLP shall be a body corporate and a legal entity separate from its partners. It will have perpetual succession.

Q: Advantages of LLP

LLP form is a form of business model which: (i) is organized and operates on the basis of an agreement. (ii) provides flexibility without imposing detailed legal and procedural requirements (iii) enables professional/technical expertise and initiative to combine with financial risk-taking capacity in an innovative and efficient manner

Q: Other Countries where this form is available

The LLP structure is available in countries like United Kingdom, United States of America, various Gulf countries, Australia and Singapore. On the advice of experts who have studied LLP legislations in various countries, the LLP Act is broadly based on UK LLP Act 2000 and Singapore LLP Act 2005. Both these Acts allow creation of LLPs in a body corporate form i.e. as a separate legal entity, separate from its partners/members.

Q: Difference between LLP & ‘Traditional Partnership’

Under “traditional partnership firm”, every partner is liable, jointly with all the other partners and also severally for all acts of the firm done while he is a partner. Under LLP structure, liability of the partner is limited to his agreed contribution. Further, no partner is liable on account of the independent or un-authorized acts of other partners, thus allowing individual partners to be shielded from joint liability created by another partner’s wrongful acts or misconduct

Q: Difference between LLP & Company

A basic difference between an LLP and a joint stock company lies in that the internal governance structure of a company is regulated by statute (i.e. Companies Act, 1956) whereas for an LLP it would be by a contractual agreement between partners. The management-ownership divide inherent in a company is not there in a limited liability partnership. LLP will have more flexibility as compared to a company. LLP will have lesser compliance requirements as compared to a company.

Introduction to Australian Company Registration

In Australia, starting a business is a rather straightforward procedure. Creating a corporation in Australia takes around a week. It’s crucial to follow the guidelines for appointing senior executives in order to create a corporation in Australia. The application must appoint a resident director in Australia.

Overview

It is a great place for business starts because it is Oceania's largest country. Various metropolitan areas include, but are not limited to, Canberra, Perth, Sydney, and Melbourne. Australia's free trade agreements with other countries allow for ongoing trade. Additionally, Australia has double taxation avoidance agreements (DTAAs) with other countries that protect investors. Any money that has amassed in Australia may be transferred back to the country of origin. The Australian government has a program that has been liberalized with regard to international investment. Consequently, a firm owner should continue with Australia expansion.

Regulatory Body for Company Registration in Australia

The primary regulatory organization in Australia for business registration is the Australian Securities and Investments Commission (ASIC).

Australian Company Registration and Business Structure Types

Australian legislation permits both domestic and foreign merchants to start their own firms. There are primarily three types of business vehicles in Australia. These consist of businesses, joint ventures, and sole proprietorships (both domestic and foreign).

Proprietary Limited Companies
A proprietary limited company is similar to an LLC or a private limited company. This organization is the one that international investors most usually turn to when looking to launch businesses in Australia. To be incorporated, this company must have at least one resident director. In a proprietary firm, there can never be more than 50 stockholders. These companies may be founded with just $1 in startup capital and held solely by foreigners. These companies must register for the Goods and Services Tax if their annual revenue reaches AUD 75,000. These companies are required to add "pty. Ltd." after their company name.

Public Companies
Public corporations are businesses that are legally permitted to raise money from the public by selling shares of their stock; normally, they do this by being listed on stock exchanges. These companies must add "Ltd." to the end of their names. Registration calls for a minimum of one member, three directors, and a secretary, with the prerequisite that at least two of the directors be Australian nationals. In contrast to proprietary organizations, public companies are required to employ an auditor.

Partnership
In Australia, general partners often create partnerships and are either accountable for the acts of their partners or merely for their fair portion of the money. The traditional consumers of these structures are the legal and accounting professions. A partnership cannot be incorporated in Australia without at least one local partner. Each partner files their own annual tax returns, and the partners divide profits and losses. However, if their yearly revenue surpasses $75,000, GST registration is required.

Trust
In Australia, small family-owned businesses frequently employ trusts as their organizational structure, and fixed or unit trusts are frequently used in bigger businesses with many families. Trusts aren't treated as separate legal entities in Australia, thus they don't have their own tax liabilities. The beneficiaries of the trust receive the trust's income distributions, and they are then in charge of paying their own income taxes. Trusts are established through a deed, not by being ASIC-registered. To conduct business, the trusts must apply for an Australian Business Number. Every trust should be compelled to appoint a trustee and public officer who resides in Australia.

Branch Office
A foreign parent company often opens a branch office. Simply put, the parent company's extension for the purposes of conducting business in Australia is the Australian branch office. The Australian branch office has the ability to operate profitably. A foreign corporation would be required to register the branch office with the Australian Securities and Investments Commission (ASIC), after which the business would receive an Australian Registered Body Number (ARBN). This is essential for how the Australian branch conducts business. A representative for the branch office must be chosen in accordance with the Corporations Act of 2001, which applies to international parent companies. To ensure that the branch office conforms, this is necessary. Before opening a branch office in Australia, a registered office with a local address is necessary. The Branch Offices must also deliver annual financial reports to ASIC.

Representative Office
While using a representative office in Australia for market and research studies is allowed, conducting commercial operations or company is not. Given that it enables the business to engage in a restricted number of non-commercial activities, it is the ideal choice for companies looking to expand internationally or conduct market and R&D prior to entering the Australian market. Opening a representative office in Australia is a simple and inexpensive process.

Documents Needed to Register an Australian Company

The following documents must be submitted in order to register an Australian company:

Application form (Offline Mode) (Form 201)

Company Bylaws or Modifiable Regulations

Reservation of Name

Form 410 should be used to reserve the name

Details about the shareholders and directors

The registered office address.

Identification of the incorporators, directors, and executives must be legitimate.

A lease or land title certificate could serve as proof of the registered official address.

Australian Company Registration Checklist

The following list must be considered before beginning the process of business registration in Australia:

Choosing the corporate structure
First, the business owner must decide between creating a corporation "unlimited with a share capital" or a company "limited by shares." An Australian company limited by shares has historically been the most common type of commercial entity. The number of shares that each shareholder has committed to pay for is the maximum number of shares for which they are personally liable. On the other hand, stockholders in corporations with a share capital have limitless personal liability. This suggests that stockholders may still be held personally liable even after fully satisfying their portion of the company's debts.

Choice regarding the constitution and revocable laws
Australia has regulations that must be followed by all businesses. Replaceable rules, a collection of normative regulations for the internal management of the company, were introduced by the Corporation Act of 2001. If the corporation wants to make its own regulations or change the accepted conventions, it must create a constitution.

Choosing a name for the company
Australian companies have the option of using their own name or their Australian Company Number (ACN). Specific laws govern how an Australian company may use its reputation. To make sure that the general public is aware of the organizational structure and the extent of the members' liabilities, the affixes must be appended to the business names. The names of proprietary limited companies must include the following words or abbreviations. Affixes consist of:

Proprietary Limited

Proprietary Ltd.

Proprietary Ltd

Pty Ltd.

Pty Limited

Unlimited proprietary businesses, on the other hand, are only allowed to add the word "proprietary" to the end of their name.

Selecting the Australian state or territory where to register a business
The business owner must pick and specify the state or region when submitting the registration application. The company's registration in Australia is unaffected by this.

Choosing the Australian addresses for the company's business and registration
The corporation must decide on the addresses for both its registered office (where all correspondence and notices to the company are sent) and its primary location of operation (the place where the company conducts its business). Australian residency is required for the registered business address. For any address, postal boxes are not permitted.

Identifying any potential eventual holding firms
If another company controls all or the majority of a company's shares, that company is said to be the ultimate holding company. Most proprietary businesses do not have an ultimate holding company, and if they do, they must disclose the name, ACN, ABN, or ARBN of the ultimate holding company as well as the nation of origin (if it is not Australia).

Choosing the company's Australian office holders
Directors and secretaries hold office in a company. The information required for each shareholder is as follows:

Names, including middle names

Residential address

Born on [date]

Birthplace

Directors:
A private firm must appoint at least one director. Other directors, though, could be picked. A director must apply in order to receive his Director Identification Number.
Secretaries:
Private companies are exempt from having to hire secretaries. However, it has been left up to the firms' discretion whether to hire one or more corporate secretaries. The people who are being chosen by the companies to take office must give their written consent. Such signed consent must be kept on file in the company's records.

Choosing the share structure
A company's share structure consists of the number, kind, and amount paid or unpaid on the shares it has issued. Every corporate stakeholder must get at least one share from the business.

Share class: Shares are the numerous categories of rights connected to various shares. As an example, while some share classes permit voting, others can permit dividend distribution. Proprietary corporations normally offer ordinary shares, which have no additional rights.

The total number of shares: It represents the firm's entire capital, includes all of the shares in each of the company's classes. The number of shares and their price are based on the amount of capital the company needs.

The amount of paid and unpaid shares: When purchasing the shares, the shareholder may pay the full amount or a portion of it, together with any unpaid shares. The paid and unpaid amounts must both be reflected in the share structure.

Choosing the shareholders
Owners of shares in a corporation are referred to as shareholders. Shareholders might be either individuals or companies. The negotiated price for each share shall be paid by the shareholders to the Company. Each Shareholder shall give its written permission specifying the number of Shares it agrees to purchase and the consideration to be paid to the Company for such Shares. The company must keep a copy of this document on file.

How to Form an Australian Company

The actions listed below must be done in Australia in order to register a business.

Selecting the organizational structure for the company

Selecting the right business name

Selecting how to do business while adhering to one's legal obligations as a public official

Obtaining consent from the participants, residents, and officeholders

Registration of organizations

Conditions following incorporation

Selecting the organizational structure for the company
The applicant must decide on an appropriate business structure before applying to form a company in Australia. The applicant must base their decision on the requirements of the intended business operations. Certain corporate entities have limited liability. This would give the applicant some benefits with regard to taxes. In addition to other kinds of firms, an entrepreneur has the option of registering the following entities:

Corporate collective investment vehicles (CCIV)

Special purpose corporations

Not for profit or charitable organizations

Registrable Australian entities

Selecting the best name for the business
The next step is for the applicant to choose a fitting business name. When choosing the name of the business, keep the following factors in mind:

The company name cannot be the same as a name that is already in use. The name shouldn't be derogatory or suggest any illegal activity, and it shouldn't include any terms that give the wrong impression about how the company operates.

ASIC's online register known as the "National Record," where the name must be registered, must be used. Such a requirement will be necessary after 2012. If the business already used the name, registration of the name would be impossible.

Any alphanumeric character may be used in the company name. This would comprise the digits 0 through 9 as well as brackets, semicolons, hyphens, and symbols that signify money, such as "$".

There are some phrases that are taboo. Such phrases are prohibited. The following words should be avoided: Government, monarchy, trust, and business If such language is used, prior approval from the relevant government agency is required.

The company name must be unique and must not mislead any individual or group.

If a name offended the public, the ASIC had the right to reject it.

The company name must accurately convey the legal status of the organization. For instance, the private limited company may conclude with Co or Coy.
Holding the company's name in reserve
Following ASIC's selection and approval of the company name, the applicant would need to reserve the name. The applicant would reserve the company name by submitting "Form 410." If approved, the company name would be retained for two months. If the applicant fails to register the company in Australia within that time frame, a fresh application for reserving the name must be made. The applicant must submit a formal request to extend the name reservation term.
Registering a trademark
The applicant for company registration in Australia must do a comprehensive search for trademarks and other intellectual property rights on the selected name. The applicant is not permitted to use any names that are in question.

Settling on a business strategy

Australia has a number of laws that pertain to enterprises and fall under one of the following categories:

Revocable rules- If a company decides not to develop its own set of rules to govern its operations, it may adopt the replacement rules offered under the Corporations Act of 2001. These are the standard rules that the Act provides for operating your business. These rules do not need to be altered as the legislation changes. If a company implements replaceable rules, a written constitution is not necessary.

A personal constitution- Organizations may decide to design their constitution in order to customize it to meet their specific needs, as opposed to replaceable rules. Sole owner or member proprietorships are exempt from the replacement regulations. whenever a new employee is added

A combination of the two documents previously stated
Fulfilling one's legal obligations as an officeholder
The Corporations Act imposes, among other things, the following legal requirements:
Keeping the register with the company's data and updating the company's information
Payment of lodgement fees as well as annual review fees

Directors must apply for a Director's Identification Number (DIN)

Obtaining consent from the occupiers, members, and officeholders
Before taking any of the following activities, the following officeholders must give their written consent to the corporation:
Secretary
Member
Director

A proprietary corporation must have at least one director and secretary with an Australian address. A public corporation must normally have two Australian residents as directors.

Registration of organizations
The final step would need the applicant to register the business. The process of registering a company can be done online or offline. Once the company application has been received and reviewed, the applicant will present the ACN. You might use this to ask for an ABN. The applicant would be given a copy of the certificate of incorporation and the company name would be added to the official registry. A corporate key is also provided to the company, which it will use to create an online account and update the data.

Conditions following incorporation

The following post-incorporation conditions must be satisfied by the company once it registers:

The company's name must always be visible whenever it conducts business or is open to the public. <
The Can/ABN of the corporation must be discernible on all documents that the company produces.
The company's information must be kept up to date.

FAQs

Concept of LLP

LLP is an alternative corporate business form that gives the benefits of limited liability of a company and the flexibility of a partnership.
The LLP can continue its existence irrespective of changes in partners. It is capable of entering into contracts and holding property in its own name.
The LLP is a separate legal entity, is liable to the full extent of its assets but liability of the partners is limited to their agreed contribution in the LLP.
Further, no partner is liable on account of the independent or un-authorized actions of other partners, thus individual partners are shielded from joint liability created by another partner’s wrongful business decisions or misconduct.
Mutual rights and duties of the partners within a LLP are governed by an agreement between the partners or between the partners and the LLP as the case may be. The LLP, however, is not relieved of the liability for its other obligations as a separate entity.

Since LLP contains elements of both ‘a corporate structure’ as well as ‘a partnership firm structure’ LLP is called a hybrid between a company and a partnership.

Structure of LLP

LLP shall be a body corporate and a legal entity separate from its partners. It will have perpetual succession.

Advantages of LLP

LLP form is a form of business model which:

(i) is organized and operates on the basis of an agreement.

(ii) provides flexibility without imposing detailed legal and procedural requirements

(iii) enables professional/technical expertise and initiative to combine with financial risk-taking capacity in an innovative and efficient manner

Other Countries where this form is available

The LLP structure is available in countries like United Kingdom, United States of America, various Gulf countries, Australia and Singapore. On the advice of experts who have studied LLP legislations in various countries, the LLP Act is broadly based on UK LLP Act 2000 and Singapore LLP Act 2005. Both these Acts allow creation of LLPs in a body corporate form i.e. as a separate legal entity, separate from its partners/members.

Difference between LLP & ‘Traditional Partnership’

Under “traditional partnership firm”, every partner is liable, jointly with all the other partners and also severally for all acts of the firm done while he is a partner.
Under LLP structure, liability of the partner is limited to his agreed contribution. Further, no partner is liable on account of the independent or un-authorized acts of other partners, thus allowing individual partners to be shielded from joint liability created by another partner’s wrongful acts or misconduct

Difference between LLP & Company

A basic difference between an LLP and a joint stock company lies in that the internal governance structure of a company is regulated by statute (i.e. Companies Act, 1956) whereas for an LLP it would be by a contractual agreement between partners.
The management-ownership divide inherent in a company is not there in a limited liability partnership.
LLP will have more flexibility as compared to a company.
LLP will have lesser compliance requirements as compared to a company.