European Union Structure
Posted in EU Info on 10/06/2010 11:23 pm by admin
Ltd, LLP or LP ?
I want to create a software company in the UK. I will try to sell a software I am developing with another associate. We’ll start with a small investment (2000 pounds maybe).
We will be 2 equal holders and active managers.
I went through http://en.wikipedia.org/wiki/Companies_law but it’s not sure which form of company is the best for my need?
I found the following list of types :
1.Public Limited Company (PLC)
2.Private company limited by shares (Ltd, Limited)
3.Company Limited by Guarantee
4.Unlimited Company
5.Limited Liability Partnership (LLP)
6.Limited partnership (LP)
7.Societas Europaea (SE): European Union-wide company structure
8.Royal Charter (RC)
9.Community interest company
I went through wikipedia and the companieshouse website, but it’s not clear which one is the best for my need.
I’m hesitating between 2, 5 and 6.
Any advice ?
You need a limited company. An LLP is normally used for accountants, solicitors and investment companies, not trading. An LP is even less suitable and the rest are for entirely different purposes. The fact that you are 2 equal partners does not mean you need a partnership format. You simply need to both act as directors and take an equal number of shares. As you are on an equal footing you should ask a solicitor to draw up a shareholders’ agreement between the 2 of you setting out what happens to the company if you have a falling out and one partner wishes to leave or sell his shares, or the company becomes insolvent etc.
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