Navigating the Process of New Entry Registration of a Limited Partnership in Liechtenstein: A Comprehensive Guide

Josef Bergt
2023

For any organization planning to register a Limited Partnership (Kommanditgesellschaft) in Liechtenstein, there are certain critical steps to be followed, culminating in an entry into the Commercial Register (Handelsregister). Each stage in this procedure requires meticulous planning and careful execution. This article serves as a guide, detailing each of these steps in sequence.

Establishing the Company Name

Primarily, choosing the company name or 'Firma' requires thoughtful deliberation. There are, however, certain restrictions that the Limited Partnership must adhere to. Firstly, no two firms can register under an identical name in the Commercial Register. Secondly, the designation 'Kommanditgesellschaft' (limited partnership) or its abbreviation 'KG' in German must feature within the company name. Thirdly, the surname of at least one partner with unlimited liability must be included in the name, with an additional element indicating the existence of a partnership (e.g., "& Co."). The inclusion of first names, though not compulsory, is permitted.

Furthermore, it's feasible to opt for a name derived from the company's business activities or an invented name without the need to append an individual's name. However, the names of other individuals, associations, or companies, except for the partner with unlimited liability, are not to be incorporated into the newly founded company name. For more information on company naming rules, refer to the guideline on company designations and names.

Queries concerning whether a chosen name is already registered or is available and eligible for use can be formally directed to Commercial Register. 

Drafting the Partnership Agreement

Creating a written partnership agreement is a vital step. The agreement delineates several crucial aspects such as the company name, the registered office, and the company’s purpose or objectives. Moreover, it lays down the legal relationship amongst the partners.

Waiving the Review

For a micro entity where all the partners are corporations that operate a business in accordance with commercial practices, it is possible to waive the auditory review process. 

Determining the Authorized Representatives and Setting Signature Rights

The Limited Partnership is typically represented by one or more partners with unlimited liability, unless the partnership agreement specifies otherwise. Additionally, the partnership agreement can further restrict representation rights, which must be recorded in the Commercial Register:

• A partner with unlimited liability may exclusively represent the main branch or a subsidiary branch;
• Representation rights may be granted to multiple partners with unlimited liability acting jointly;
• Representation rights may be assigned to a partner with unlimited liability along with a proxy holder; or
• All partners with unlimited liability may be excluded from representation. In this case, third parties or Limited Partners must be entrusted with management and representation.

Excursus: Liechtenstein type limited partnership and general partnership with limited liability according to Art. 755 PGR

If a company is established by written contract under a common firm in such a way that all partners are liable for the company's liabilities, each as a limited partner with a limited partnership sum, the provisions of the limited partnership apply, but with the following deviations:

• In the registration to the commercial register that takes place with the attachment of the partnership agreement and its entry, the following must be specified: 
  • Name, first name, status and place of residence or firm and seat of each limited partner along with their limited partnership sum and the actual deposit made by each partner on this, as well as the total amount of all limited partnership sums;
  • the firm, in which the name of a limited partner may appear without increasing liability, the seat, the object of the enterprise or purpose of the company;
  • Name, first name and place of residence or firm and seat of the partners or third parties who manage and represent the business.
  • The publication should be limited to the firm, the object of the company, the total amount of the limited partnership sum and the information about the names and place of residence or firm and seat of the managing and representing persons.
  • These provisions also apply appropriately when the facts or circumstances subject to registration undergo a change.
• The non-managing partners have the same position as a collective partner towards the managing partners and a competition prohibition exists by default as with collective partners, but only for the managing partners, the managing and representing partners or third parties assume the position of the managers in the limited liability company towards the partners and third parties.
• If a minimum share capital is provided for by regulation in the case of a limited liability company, the minimum amount of the equity contribution made by the partners when the company is established must equal this minimum share capital; if the pure company assets subsequently fall below this amount, any partner or creditors can demand dissolution under the same conditions as in the case of a one-person legal entity.
• The partners can obligate themselves in the partnership agreement, besides the limited partnership sum, to a limited additional contribution or to recurring, non-cash benefits, just like in the registered cooperative.
• The amount of the paid-in limited partnership sums is to be included in the liabilities side in the financial statements; in the absence of another agreement, the partners participate in the profit and loss in proportion to their limited partnership sum and, if a limited partnership sum, such as for work performed, does not exist, the share is determined at the court's discretion.
• This company is dissolved by the opening of an insolvency procedure and otherwise a liquidation must take place according to the general regulations concerning legal entities, unless the Office of Justice grants an exception.

However, if a company is established by a written contract under a common firm by registration in the commercial register in such a way that all partners are liable, just like general partners, but only up to a certain amount specified in the partnership agreement, the regulations on the general partnership and the first four main bullet points of the previous paragraph apply accordingly for such a company (general partnership with limited liability).

Application for Entry into the Commercial Register

The application letter for registration of a Limited Partnership in the Commercial Register must contain the following details:

• The company name, legal form, and registered office;
• The place of representation or delivery address;
• The purpose or objectives of the company;
• The date of the partnership agreement;
• The partners with unlimited liability, including their name, first name, date of birth, nationality, address, and type of signature;
• If a partner is a legal entity, its name, registered office, and type of signature;
• The Limited Partners, including their name, first name, date of birth, nationality, address, type of signature, and the amount of their limited partnership contribution;
• Any branch offices if applicable;
• Any potential waiver of the review; and
• The date of the financial year-end, if the company is subject to disclosure requirements.

If a limited partnership contribution is made in kind, this must be explicitly stated in the application, along with a specific valuation. The application must be personally signed by all partners, including Limited Partners, in front of the Commercial Register, or submitted in a certified form.

Obtaining Necessary Approvals

When running a business in accordance with commercial practices, it is usually necessary to obtain a trade license or other specific statutory approval (for example, from the Financial Market Authority (FMA) or another authority).

Documents to be Submitted

The following documents must be submitted to the Office of Justice – Commercial Register Department along with the application for entry into the Commercial Register:

• The so-called company signature declaration (sample signature) of the authorized representatives, with their (sample) signatures needing to be certified;
• If the Limited Partnership must have an auditor, its certified declaration of acceptance of the appointment;
• Any necessary approvals or permits, for example, from the Financial Market Authority (FMA).

Fees

The fee for a new entry registration of a Limited Partnership is CHF 400.00. Additional charges include CHF 30.00 for each authorized signature to be recorded, CHF 20.00 for the entry of a function, and CHF 30.00 for the representation or delivery address.

Source: Factsheet AJU/ h80.002.01; Art. 1019 PGR; Art. 1063 PGR; Art. 1021 PGR; Art. 733-735 PGR; Art. 740 PGR; Art. 699 PGR; Art. 755 PGR; Art. 1058a PGR.

Executive Summary:

• Selecting a unique company name that complies with legal requirements is an essential first step in establishing a Limited Partnership in Liechtenstein.
• The partnership agreement, outlining essential aspects such as company name, office, objectives, and the relationship between partners, must be drawn up.
• Under certain conditions, small corporations can waive the review process.
• The partnership agreement stipulates the assignment of representation rights, which must be recorded in the Commercial Register.
• The application for registration should include all essential details of the company, its partners, and operational specifics.
• Necessary approvals, such as a trade license or other statutory permissions, must be secured.
• The Office of Justice – Commercial Register Department requires the submission of certain documents, including a certified company signature declaration, an auditor’s declaration (if needed), and any necessary approvals.
• The costs associated with registering a Limited Partnership include a base fee of CHF 400.00, with additional charges for each authorized signature, the entry of a function, and the representation or delivery address.