Here are the differences between a Limited Liability Partnership and a Private Limited Company:
| Limited Liability Partnership (“LLP”) | Private Limited Company | |
| Definition | A partnership where it provides limited liability status to its partners | A business form which is a legal entity separate from its directors and shareholders |
| Owned by | At least 2 partners and no limit for maximum number of partners | Not more than 50 shareholders |
| Legal Status | A separate legal entity from its partners Partners have limited liability Can sue or be sued in LLP’s name Can own property in LLP’s name | A separate legal entity from its directors and shareholders Shareholders have limited liability Can sue and be sued in company’s name Can own property in company’s name |
| Personal Liability | No personally liability of partner, except for own wrongful act or omission or without authority Liabilities borne by the partners are jointly and severally with the LLP to the extent of contribution only | No personal liability of individual director or shareholder Liabilities borne by the directors or shareholders are to the extent of unpaid shares only |
| Yearly Statutory Obligations | Must lodge Annual Declaration of solvency or insolvency by the compliance officer within the prescribed period every year | Must lodge Annual Returns and Audited Financial Statements within the prescribed period every year or other statutory documents as required by the laws |
| Registration Requirements | At least two partners, who can be individual of 18 years old and above or body corporate At least one compliance officer who is at least 18 year old and ordinarily resides in Malaysia Must have a registered office in Malaysia | At least one director who is at least 18 years old and ordinarily resides in Malaysia At least one shareholder who is at least 18 years old Must appoint a Company Secretary within 30 days of incorporation Must have a registered office in Malaysia |
| Continuity in Law | The LLP has perpetual succession until wound up or struck off | A company has perpetual succession until wound up or struck off |
| Closing the Business | Winding up – voluntarily by partners or compulsorily by the Court Striking Off | Winding up – voluntarily by member or creditors, compulsorily by the Court Striking Off |
