LLP Incorporation Made Easy: One More Step for Ease of Business

With a successful position at 100, the government of India aims to be in the top 50 nations in terms of “Ease of Doing Business – (EoDB)”. The new reforms of LLP have taken an online route for incorporation which stranded due since long.

Central Registry Centre was established in 2016 to accelerate EoDB and on-line incorporation of a company was introduced back then.

With an aim to accelerate EoDB, the government divided it into three major parts: reduction in time, reduction in cost, and reduction in procedures. RUN-LLP (Reserve Unique Name – Limited Liability Partnership) is introduced to simplify and ease web services for online name registration of business. Secondly, FiLLiP has replaced Form 2 combining three areas:

• Name reservation;
• Allotment of Designated Partner Identification Number(DPIN/DIN); and
• Incorporation of the LLP.

Whereas, other forms required for registration are – Form 17, Form 18 and Form 5. This centralized registration is considered to reduce the processing time to D+1 and to spur the growth of businesses in the country.

The ministry of India will initiate the re-engineering process with effect from 2 October 2018. The procedure for the incorporation of LLP will take less time, less fees and reduced procedure. Below are the steps to get the LLP incorporated:

• Obtain Digital Certificate (DSC);
• Reservation of name through RUN-LLP;
• Fill up FiLLiP Form for incorporating LLP;

LLP has its unique advantages. Below are some reasons stating why LLP should be considered by entrepreneurs.

• Just like companies, LLP is a separate entity;
• Requires less money and time as compared to the company;
• Fewer compliances as compared to the company;
• Liability of each partner remains limited to the contribution made by the partner;
• There is no minimum capital contribution requirement.

The changes LLP incorporation structure will briefly include below aspects:

• Incorporation of Simplified Proforma for Incorporating Company Electronically Form (SPICe) and RUN-LLP Form to ease and simplify procedures;
• The incorporation fees is reduced to Rs. 500 from Rs. 2000.
• A new integrated system of Form FiLLiP including three aforesaid areas;
• The government has also framed rules to protect minority investors. These rules will protect the interest of minority investors.

Another Milestone in the direction of “Ease of Doing Business”: Incorporation of Limited Liability Partnership (LLP) through a complete online system made a reality ; For full details, please log on: https://t.co/uF6vWFWzKt

— Ministry of Finance (@FinMinIndia) October 1, 2018

With a view to promote business and encourage entrepreneurs, these changed reforms will play a crucial role.