Simple Limited Partnership (Société en Commandite Simple)
The simple limited partnership is a company constituted amongst at least two partners divided into two categories of partners: the general partners and the limited partners. General partners (referred to in French as “commandités”) are in charge of the partnership‘s management and they are jointly and severally liable for all debts and obligations of the partnerships. As such, general partners are considered to be “merchants” and are thus subject to the provisions applicable to merchants including the provisions of the Lebanese Code of Commerce. As for limited partners, their liability is limited to the amount of their contribution into the partnership.
Shares (referred to as “parts” in partnerships) are not “freely tradable” and may only be transferred upon unanimous approval of partners. There is no minimum capital requirement and contributions may be in-kind, in services or in-cash. The limited partnership works under the “partnership denomination” (such name is referred to in French as “raison sociale”) which must include the name of some or all general partners followed by the expression “et Cie” or “and Co”. It should be noted that limited partners may not interfere in the partnership management and their names may not be included in the partnership’s denomination.
A limited partnership may not operate in regulated sectors such as banking, air transport, insurance, financial brokerage and other regulated industries that are subject to special laws and regulations requiring specific legal structures and entities.
Step-by-Step Process for Business Registration
This section describes the simplified process of registering a Simple Limited Partnership (Société en Commandite Simple). In general, the simplified process involves three stages:
Stage 1: Getting forms from Libanpost and checking the desired name availability.
Stage 2: Preparing all required forms and documents.
Stage 3: Submitting the filled forms and documents and the required fees to Libanpost.
Once these stages are completed, the applicant(s) will receive from Libanpost by mail the Certificate of Incorporation (Registration) and Tax ID within five to seven business days. The applicant is then ready to do business and the bank will liberate the fund (capital) blocked by the founders (where applicable) upon request.
Following is a description of the registration process for each type of the ten legal business structures:
Stage 1: Getting the required forms from Libanpost and checking the name availability.
Once the applicant has elected to register a Limited Partnership, the applicant will visit any Libanpost office in order to:
- Verify the Partnership’s name availability through the database available at Libanpost.
- Obtain the required forms, namely:
(i) The Partnership by-laws/Constitution Agreement
(Form LPA1-1)
(ii) The request for registration of the Partnership
(Form PLP 2-1)
(iii) The Partnership Commercial Circular
(Form PLP 3-1)
(iv) The Partnership Certificate of Incorporation
(Form PLP 4-1)
- Obtain a list of the fees and expenses that need to be paid (Appendix II).
Stage 2: Preparing and Completing all required forms and documents.
Once the above forms are obtained, they must be completed as follows:
1- The Partners (at least two) must sign the Partnership’s Constitution Agreement (also referred to as “Articles of Association” or “by-laws”) before a notary public. A sample text of by-laws is annexed as Form LPA1-1 that the partners may fill and sign “as is” or they may add to it other clauses.
2- The Commercial Circular (Form PLP 3-1) will then be completed and signed by the Partnership authorized signatories (usually the general partners), in as many copies as the applicants require.
3- The Certificate of Incorporation will be completed (Form PLP 4-1).
4- The applicant will then fill in the request for registration (Form PLP 2-1).
Stage 3: Submitting the filled forms and documents and the required fees to Libanpost.
Once all the above forms are completed, the applicant will submit the entire file to Libanpost and pay all required fees and expenses. Copies of legal identification (ID) of all partners and/or shareholders should also be submitted.
Completion Stage:
Within approximately 5 business days of submission of the entire file to Libanpost the applicant will receive:
- A “Certificate of Incorporation” evidencing the Partnership registration,
- A Tax Identification Number (TIN).
- Any other required documents
The applicant is now ready to do business.