Western Australian Current Acts

LIMITED PARTNERSHIPS ACT 2016 - SECT 43

43 .         When does limited partner take part in management?

        (1)         For the purposes of section 42, a limited partner in an incorporated limited partnership does not take part in the management of the business of the partnership merely because the limited partner or a person acting on behalf of the limited partner —

            (a)         is an employee of or an independent contractor engaged by —

                  (i)         the partnership; or

                  (ii)         a general partner in the partnership; or

                  (iii)         an associate of a general partner in the partnership;

                or

            (b)         is an officer of a body corporate that is —

                  (i)         a general partner in the partnership; or

                  (ii)         an associate of a general partner in the partnership;

                or

            (c)         gives advice to, or on behalf of, the partnership, a general partner in the partnership or an associate of a general partner in the partnership in the proper exercise of functions arising from —

                  (i)         the engagement of the limited partner, or the person acting on behalf of the limited partner, in a professional capacity; or

                  (ii)         business dealings between the limited partner, or the person acting on behalf of the limited partner, and the partnership, a general partner in the partnership or an associate of a general partner in the partnership;

                or

            (d)         gives a guarantee or indemnity in respect of any liability of the partnership, a general partner in the partnership or an associate of a general partner in the partnership; or

            (e)         takes any action, or participates in any action taken by any other limited partner in the partnership, for the purpose of enforcing the rights, or safeguarding the interests, of the limited partner as a limited partner; or

            (f)         if authorised by the partnership agreement —

                  (i)         calls, requisitions, convenes, chairs, participates in, postpones, adjourns or makes a record of a meeting of any of the partners in the partnership; or

                  (ii)         requisitions, signs or otherwise passes, approves, disapproves or amends any resolution (whether at a meeting, in writing or otherwise) of any of the partners in the partnership, including without limitation by formulating, moving, proposing, supporting, opposing, speaking to or voting on the resolution;

                or

            (g)         exercises a power conferred on the limited partner by section 107; or

            (h)         gives advice to, or consults with, an officer, director, security holder, partner, agent, representative, employee of, or independent contractor engaged by, an associate of the partnership; or

                  (i)         is, or acts as, an officer, director, security holder, partner, agent, representative, employee of, or independent contractor engaged by, an associate of the partnership; or

            (j)         is, or acts as, a lender to, or fiduciary for, an associate of the partnership; or

            (k)         to the extent authorised by the partnership agreement —

                  (i)         participates on a committee (a relevant committee ) that considers, approves of, consents to or disapproves of a proposal of a kind referred to in section 44; or

                  (ii)         has, or exercises, any right to appoint one or more persons to, remove one or more persons from, or to nominate one or more persons for appointment to or removal from, a relevant committee;

                or

            (l)         nominates, selects, investigates, evaluates or negotiates with any person in connection with the removal or replacement of a general partner; or

            (m)         participates on a committee that proposes, considers, approves of, consents to or disapproves of any nomination, selection, appointment, change in control or ownership, suspension, replacement or removal of a general partner or an associate of a general partner; or

            (n)         takes any action, or participates in any action taken by any other limited partner, for the purpose of registering or maintaining the registration of the partnership or a general partner in the partnership as an AFOF, ESVCLP or VCLP.

        (2)         Subsection (1) is not to be taken to have the effect that a limited partner in an incorporated limited partnership takes part in the management of the business of the partnership merely because the limited partner or a person acting on behalf of the limited partner does anything in connection with the conduct of that business that is not referred to in that subsection.

        (3)         Subsection (1) is not to be taken to have the effect that a limited partner in an incorporated limited partnership that is a VCMP takes part in the management of the business of the incorporated limited partnership merely because of any act the limited partner takes in respect of the incorporated limited partnership in the capacity of a partner or associate of a partner in the VCMP.

        (4)         The application of this section cannot be varied in relation to an incorporated limited partnership by the partnership agreement or with the consent of the partners in the incorporated limited partnership.