Limited Liability Partnerships (Dissolution and Winding Up) (Jersey) Regulations 2018

Summary

These Regulations, made under the Limited Liability Partnerships (Jersey) Law 2017, set out the detailed process for dissolving and winding up Jersey limited liability partnerships (LLPs), covering both solvent winding up and insolvent winding up. They specify who must act as dissolution manager or insolvency manager, what notices and statements must be filed with the registrar, creditor meeting procedures, powers of the Royal Court, and offences for non compliance.

• Dissolution triggers: An LLP is automatically dissolved when it ceases to have 2 or more partners, or may be dissolved by act of a partner, other occurrence under the partnership agreement, or by Court order.
• Solvent winding up: Part 3 requires a dissolution manager to wind up the affairs of a solvent LLP, with Court oversight and power to give directions.
• Insolvent winding up: Part 4 applies where the LLP is unable to pay its debts as they fall due, requiring creditors meetings, appointment of an insolvency manager and (optionally) an insolvency committee, and application of désastre law concepts such as unenforceability of liens, transactions at an undervalue, wrongful and fraudulent trading, and extortionate credit transactions.
• Cross border recognition: Foreign court orders dissolving or winding up an LLP are only effective in Jersey once recognized by the Royal Court.
• Offences and penalties: Failure by a last remaining partner, secretary, dissolution manager, insolvency manager, or applicant partner to comply with statutory notice and filing duties is an offence, with penalties ranging from a fine up to a level 3 fine, and up to 2 years imprisonment and a fine for the most serious breaches (failure to cooperate, obstructing search, corrupt inducement).

The Regulations are already in force (commenced 1 August 2018, with later amendments from 31 May 2019) and impose ongoing procedural obligations on LLPs, their partners, secretaries and appointed managers whenever dissolution or winding up occurs.

Key obligations

• The last remaining partner of an LLP dissolved for having fewer than 2 partners must deliver a signed statement of dissolution to the registrar within 28 days after the date of dissolution
• Where an LLP is dissolved by act of a partner or other occurrence, the secretary (or, if none, the remaining partners) must deliver a signed statement of dissolution to the registrar within 28 days
• A partner who applies to the Court for dissolution must deliver a copy of the dissolution order to the registrar within 28 days after it is made
• Where partners acquire the interests of retiring partners to continue the LLP, the LLP must send a statement of cancellation of dissolution to the registrar within 28 days of the acquisition (or within 90 days where dissolution arose from falling below 2 partners, after giving notice of intention to continue within 7 days of dissolution)
• A dissolution manager must deliver notice to the Judicial Greffier of the vesting of any immovable property within 28 days after it vests
• If a solvent winding up is found to involve an insolvent LLP, the dissolution manager must cease winding up under Part 3 and take the steps required under Part 4
• An insolvency manager or person appointed to wind up an LLP following recognition of a foreign order must deliver a copy of the Court's recognition decision to the registrar within 28 days
• Records of a dissolved LLP and its insolvency manager must be retained for at least 10 years after cancellation of registration
• Partners, officers and others must co-operate with an insolvency manager, the Minister, the Commission or an inspector, and failure to do so is an offence

Applies to

limited liability partnerships, partners in limited liability partnerships, secretaries of limited liability partnerships, dissolution managers, insolvency managers, creditors of limited liability partnerships, insolvency committees

Deadlines

• 28 days after the date of dissolution: Last remaining partner must deliver statement of dissolution to the registrar
• 28 days after the date of dissolution: Secretary (or remaining partners) must deliver statement of dissolution to the registrar
• 28 days after the order is made: Applicant partner must deliver copy of Court dissolution order to the registrar
• 28 days after the acquisition: LLP must send statement of cancellation of dissolution to the registrar
• 7 days of the dissolution: Notice of intention to continue the partnership must be given to the registrar
• 90 days after the dissolution: LLP must send statement of cancellation of dissolution to the registrar where continuing after falling below 2 partners
• 28 days after the property vests: Dissolution manager must deliver notice of vesting of immovable property to the Judicial Greffier
• 28 days after the decision is made: Insolvency manager or appointed person must deliver copy of Court's recognition decision to the registrar
• 10 years from cancellation of registration: Period after which no responsibility rests for records not being forthcoming

Related documents

• This document is made under Limited Liability Partnerships (Jersey) Law 2017