Subject: PROVISION OF ULTIMATE BENEFICIAL OWNERSHIP INFORMATION ON LLP FORM XII
Please refer to the captioned subject matter.
2. It is intimated that pursuant to amendment in Section 8 of Limited Liability Act, 2017 (“the LLP Act”) as made through Limited Liability Partnership (Amendment) Act, 2020 on August 27, 2020 and subsequent insertion of regulation 14A in the Limited Liability Partnership Regulations, 2018 (“the LLP Regulations”), vide SRO 925(I)/2020 dated September 28, 2020, it has been made mandatory for all the Limited Liability Partnerships (“LLPs”)to obtain, maintain and timely update particulars of ultimate beneficial owners, including any changes therein.
3. In terms of Section 8 of LLP Act “ultimate beneficial owner” means a natural person who ultimately and effectively owns or controls a limited liability partnership through direct or indirect rights or who shares at least one fourth of the net profits and losses of the partnership.
4. Consequently, every LLP is required to file declaration of compliance of section 8 of the LLP Act to the registrar concerned through filing of LLP Form XII after ensuring compliance with provisions of Regulation 14A of the LLP Regulations. The compliance with the said amendment in section 8 of the LLP Act was required within three months of coming into force i.e. by November 27, 2020.
5. As per record of your LLP maintained in this office, it has been observed that LLP has not filed Form XII with the registrar and, prima facie, violated the mandatory provisions of sub-section (2) of Section 8 of LLP Act and regulation 14A of LLP Regulations, which attracts penal provisions contained in sub-section (3) of Section 8 of LLP Act, as reproduced below:
(3) Any contravention or default in complying with requirement of this section shall be an offence liable in case of –
(a) a partner, designated partner or officer, to a fine which may extend to one million rupees; and
(b) the limited liability partnership, to a fine which may extend to ten million rupees.
6. In view of the above, the LLP and all its partners and designated partners are, hereby, called upon to ensure immediate compliance with the provisions of sub-section (2) of Section 8 of the LLP Act read with Regulation 14A of the LLP Regulations by filing of LLP Form XII, failing which legal proceedings shall be initiated against the LLP and its partners for violation of the aforementioned provisions of the LLP Act.
7. Compliance of the above may be immediately made by filing relevant form with the registrar concerned through online or physical mode and intimation of such filing be also made on email firstname.lastname@example.org.
8. Please ignore this notice if the company has already made compliance.