Forming a general partnership and continuing obligations


Published by a ½Û×ÓÊÓƵ Corporate expert
Practice notes

Forming a general partnership and continuing obligations


Published by a ½Û×ÓÊÓƵ Corporate expert

Practice notes
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This PrACTice Note discusses the conditions that need to be satisfied to Form A General partnership under the Partnership Act 1890 (PA 1890). It also discusses the statutory restrictions relating to the partnership’s name, trading disclosures that partnerships must make and the obligation to produce and keep partnership accounts.

Formation

In order to form a partnership, it is not necessary to file any documents, to register any information anywhere or to complete any other formalities. Two people may form a partnership by simply starting to carry on a business together and sharing the profits, subject to fulfilling the requirements of the definition described below. For an overview of the formation of a partnership, see flowchart: Forming a general partnership—flowchart.

As regards the ways in which a partnership may be terminated, see Practice Notes: Ending a general partnership—dissolution otherwise than by the court and Ending a general partnership—dissolution by the court.

‘Partnership’ is defined in the PA 1890 as ‘the relation which subsists between persons carrying on a business in common with a view of profit’.

Considering

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Jurisdiction(s):
United Kingdom
Related legal acts:
Key definition:
General partnership definition
What does General partnership mean?

Often referred to as a partnership. A partnership under the Partnership Act 1890, namely the relationship that subsists between persons (which includes individuals or corporate entities) carrying on a business (which includes every trade, occupation and profession) in common with a view of profit. The Partnership Act does not provide a complete code of partnership law and expressly preserves the rules of equity and common law applicable to partnerships. As a partnership is not a separate legal entity from its partners it cannot acquire rights, incur obligations or hold property in its own right. It is therefore important to distinguish between partnership property and property that personally belongs to an individual partner.

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