The Limited Liability Partnership (LLP) is a type of business that combines the best features of a Limited Company and a Partnership Firm. The LLP Act, 2008 makes it mandatory for an LLP to get incorporated with the Registrar of Companies. In this blog, we will discuss the entire process of incorporating an LLP, step by step.
An LLP can be incorporated by a completely online process. The Ministry of Corporate Affairs provides a web-based application form called FiLLiP, that can be filled online, with all the supporting documents being uploaded electronically. It is also signed using a digital signature with an option to pay the prescribed application fee online.
The LLP Act mandates the incorporation or registration of a Limited Liability Partnership. According to the provisions of the Act, for registering an LLP, an application is required to be filed in Form 2 (FiLLiP) to the Registrar of Companies. The entire process, beginning from accessing the form to submitting it, is 100% online. We have briefly mentioned the stepwise process of LLP registration below.
The Designated Partners in an LLP are responsible for controlling its management and making key decisions on subject matters beyond the day-to-day business operations. Hence, their role in the establishment and incorporation of the LLP is immensely important. Before you register your LLP you must make sure that all the current designated partners have been allotted their respective Designated Partner Identification numbers or DPINs. This is a unique number allotted to all individuals who are acting or are looking forward to acting as the designated partner in any LLP, and serves as a mark of their identity. To apply for a DPIN, you can file an application to the Ministry of Corporate Affairs in form DIR 3.
Briefly, the Companies Act stipulates that the name of your LLP must be unique and cannot be the same as or mostly similar to the name of any other LLP or company that is already incorporated. Additionally, it cannot include any words that the Central Government deems to be offensive or undesirable. The Company Incorporation Rules include a list of such undesirable words as well as a list of words that can only be used with the Central Government’s approval.
In accordance with the Trademark Act, you must make sure that your LLP’s name does not, in whole or in part, be identical with any registered trademark. If it does, you can only use it if the owner of the trademark issues a No Objection Certificate for its use.
Also, as the name of your LLP is an original and unique creation, we advise that you register it as a trademark to prevent others from misusing or copying it.
The Names and Emblems Act, the third and last statute, forbids the use of any words in the name of your LLP that would imply an association with or endorsement by the Government. This is so that the general public wouldn’t be misled by the name, and mistake a privately owned LLP to be a Government company. Words like “National,” “State,” “Union,” “Central,” and many others are examples of such words.
However, here we are concerned with the process that needs to be followed after the selection of the name. The selected name of your LLP must be reserved with the Registrar at the Central Registration Center, for which you need to file the RUN-LLP application. You can propose two names per application, which will be examined by the registrar. The name that is found to be valid will be reserved for your LLP.
However, if both the names proposed are found to be invalid, you will receive two chances of resubmission, where you can propose two fresh names in each of the resubmitted forms, without paying any fresh application fee. If none of the names proposed are still found to be valid, even after you have availed the two chances for resubmission, your application will finally get rejected, and you shall have to file a fresh application with a fresh application fee.
Once you are done with obtaining the DPIN and DSC, reserving the name, and drafting the LLP agreement, you are ready to file the application for LLP registration. The application can be publicly accessed on the official website of the Ministry of Corporate Affairs. The application seeks details like the names, addresses, and capital contributions of all partners, names and DPINs of all designated partners, the name and registered address of the LLP, and other related information.
After submitting the form, you will be automatically redirected to the payment page. Following payment, a challan will be generated, along with a Service Request Number (SRN). Keep the challan safe because you will need it for future reference. Once the form has been approved by the relevant Ministry official, you will receive an email, and the status of the form will be changed to Approved.
The submitted application will then be examined by the Registrar, and if he is satisfied that the application has been filed accurately, with the correct details and the correct documents, he will approve your application and finally register your LLP. As a conclusive proof of such registration, he will issue a Certificate of Registration in the name of your LLP, which can be downloaded online, and will allot a unique LLP Identification Number.
Like any other Partnership business, the foundation of an LLP is also based on the terms and conditions mutually agreed by its partners. All these terms and conditions are documented in the LLP agreement, which is signed by all the partners in the presence of a Public Notary. The LLP agreement must be submitted to the Registrar of Companies within 30 days from the date of incorporation of the LLP.
Registering your LLP cannot be possible without appropriate documentation. So, before you file the application for LLP registration, you must make sure that you have arranged all the necessary documents to avoid any hassle or hindrance during the actual process of registration.
The Fillip form has greatly simplified the legalities of incorporation. In order to incorporate an LLP in India, applicants no longer need to deal with mountains of paperwork or other formalities. The Ministry of Corporate Affairs has incorporated all facilities in this form to ensure a smooth and transparent incorporation process..