The appeal of establishing a new limited partnership in Jersey as a business or investment structure has steadily increased over many years since legislation was introduced in 1994 and there has been a rise of enquiries from unincorporated foreign law governed limited partnerships wishing to continue their partnership as a Jersey law governed partnership.

New regulations, designed to provide a clear statutory process to allow for the continuance of unincorporated foreign limited partnerships into Jersey, have this week passed through the Jersey States Assembly, becoming effective from 17 July 2020.  The new regulations are summarised below.

THE Limited Partnerships (Continuance) (Jersey) Regulations 2020

The Limited Partnerships (Continuance) (Jersey) Regulations 2020 (the Regulations) establish the process by which an unincorporated foreign limited partnership can be approved for continuance into Jersey and the effect of the continuance on its pre-existing state.  Upon its continuance into Jersey, the unincorporated foreign limited partnership will continue as an unincorporated limited partnership governed by the LP Law.

The Regulations, set out the requirements pursuant to which a limited partnership may apply to the Jersey Financial Services Commission (the JFSC) to continue as a Jersey law governed limited partnership. To be eligible for continuance the foreign limited partnership must satisfy the following conditions:

  • the foreign law under which it is currently established does not prohibit its continuance within Jersey;
  • the limited partnership is solvent;
  • the limited partnership is not in a state of being wound up or put into administration; and/or
  • the limited partnership is not in the process of being deregistered other than in respect of its continuance to Jersey.

As part of the application, the general partner of the limited partnership will be required to make a declaration confirming that: it is solvent; the limited partnership will not have legal personality on its continuance; it has applied for registration under the LP law and for the consent of the JFSC under article 10 of the Control of Borrowing (Jersey) Order 1958.  The JFSC will also require evidence that the application to continue has been approved by the general partner; and if the law of the jurisdiction under which the eligible foreign limited partnership is or was formed requires an authorisation to continue as a limited partnership within Jersey, that the limited partnership has obtained that authorisation.

Finally, the Regulations set out the effect of the continuance, namely that the foreign limited partnership will no longer be treated as being formed under the law of the foreign jurisdiction and all its existing assets and property which it held before continuance will be treated as property held by the limited partnership under the LP Law.  The Regulations make it clear and explicit that the continuance will not create a new legal entity, affect any partnership interests, rights, powers, functions or obligations of its partners nor will it affect any acts or things done by the limited partnership before its continuance into Jersey.

It is expected that the JFSC will shortly publish a guidance note in respect of the practical application of the Regulations, setting out additional considerations to be made for any unincorporated foreign law governed limited partnerships wishing to continue their partnership as a Jersey law governed partnership.

Jersey law already contains provisions for incorporated foreign law companies to continue into Jersey, meaning general partners of unincorporated foreign law limited partnerships can already apply for continuance into Jersey notwithstanding the proposed Regulations.

If the continuing limited partnership operates as an investment fund, additional regulatory applications will need to be made and authorisations obtained before the continuance has effect.  It is expected that many continuing limited partnerships will seek approval as Jersey Private Funds and further detail can be found here.

Share
Twitter LinkedIn Email Save as PDF
Key Contacts

Andrew Weaver

Partner: Jersey

T +44 (0)1534 818 230
E Email Andrew

James Gaudin

Managing Partner: Jersey

T +44 (0)1534 818 337
E Email James

Mark Brady

Group Partner: Jersey

T + 44 1534 818285
E Email Mark

Chris Smedley

Senior Associate: Jersey

T +44 (0)1534 818 171
E Email Chris

Kevin McQuillan

Senior Associate: Jersey

T +44 (0)1534 818 367
E Email Kevin

Paul Worsnop

Senior Associate: Jersey

T +44 (0)1534 818 225
E Email Paul

Daniel Healy

Associate: Jersey

T +44 (0) 01534 818 010
E Email Daniel

More Publications
7 Aug 2020 |

Jersey Property Unit Trusts – for UK real estate investment

Jersey Property Unit Trusts (JPUTS) are a frequently used, and popular, vehicle for holding UK real ...

Contributors: Daniel Healy
31 Jul 2020 |

No more LIBOR

On 3 August, the move away from benchmarking against LIBOR and other interbank offered rates (“IBO...

23 Jul 2020 |

Guernsey approves new discrimination legislation – but the battle continues…

There was much celebration accompanying the approval by the States of Guernsey to introduce discrimi...

20 Jul 2020 |

Listing quoted Eurobonds on The International Stock Exchange

The International Stock Exchange (TISE or the Exchange) provides recognised facilities for the listi...

Contributors: Chris Smedley
14 Jul 2020 |

How COVID-19 is Affecting the Responsibilities of Trustees and How They Can Ensure They are Fulfilling Their Duties

First published on ePrivate Client, July 2020 These unprecedented times of COVID-19 are challengi...

2 Jul 2020 |

A Mandatory Update

Jersey will soon implement the OECD’s mandatory disclosure regime (DAC6) through its own mandatory...

30 Jun 2020 |

"Lockdown" or "Time to Break Free"?

Arguably one of the greatest strengths of the human race is our ability to adapt. Few people in our ...

Contributors: Richard Field
24 Jun 2020 |

Continuance of unincorporated Foreign Limited Partnerships Into Jersey

Jersey has developed into one of the world’s leading financial centres, offering investors and pro...

Contributors: Chris Smedley
23 Jun 2020 |

The International Stock Exchange – The home of UK Real Estate Investment Trusts (REITs)?

Real Estate Investment Trusts (REITs) were introduced in the UK under the Finance Act 2006 on 1 Janu...

Contributors: Chris Smedley