All Kinde of Registration
Firm Registration /AOP
Pakistan Engineering Council (PEC )Registration
SECP Company Registration Private Limited
There is no penalty for non-registration it is optional. However there are disadvantages for not registering. If any dispute arises among the partners or ex-partners they May not resolve the issue through the civil courts. An unregistered firm cannot Institute a suit to settle these disagreements. Neither can an unregistered firm Sue a third party for the enforcement of any rights arising from a contract, e.g. the recovery of the price of goods supplied. It must be noted however, that a Third party may file suit against the partnership. Even in this case, the Partnership cannot mention any monies that may be outstanding to them in Court. There is no protection to the partners’ liability either. As there is no Formal documentation stated that they are in partnership, if one decides to deny the existence of the partnership, there is not much that can be done about it legally. Registering during any suit cannot subsequently cure this Effect. Prior registration is necessary. The mutual rights and obligations of all partners must be documented in the Shape of a “partnership deed”. This needs to be signed by all the partners and Subsequent copies held by each partner. At the time of registration, a copy of the deed has to be submitted with an application to the Registrar of Firms in The concerned area. This document may also be referred to as an “Article of Partnership”. A partnership deed usually contains the following format:
- The name of the firm
- The nature of business that is to be carried out by the firm
- The address at which the firm intends to conduct its business
- The amount of capital that each partner contributes. The form of capital whether that is cash or property needs to be documented. If the capital is Property, a full description of the property and the valued amount should be given also.
- The names and addresses of each partner should be given
- The duration of the partnership if any
- The ratio of sharing profits and losses
- The amount or percentage of interest, if any, which is to be allowed on Capital
- The amount of salary each partner is to receive
- The manner in which a partnership is to be dissolved, and the subsequent Distribution of property among the partners.
- In the case of insolvency the valuation and treatment of goodwill
- Provisions regarding the accounting system and the fiscal year to be used
- Rules to be followed in the case of retirement, death and admission of a Partner
- the method of settling disputes if any among partners. I.e. whether or not an arbitrator is to be appointed
- Method of calculating amount issued to a deceased partner, and whether this is to be paid in full or in installments to his legal representative.
- In the case of breach of duty by one partner, powers of other partners to expel him from the firm
- the keeping of proper books of accounts and periodical preparation of Accounts.
- Any provisions to prevent any future misunderstanding and ill will. Notes: A Partnership deed can be obtained in the form of judicial papers that cover all the points mentioned above. This in turn can be signed and Submitted to the registrar as mentioned.
- Ordinary Partnerships
- Limited Partnerships
- Partnership at-will. Advantages of Firm
- The registered firm can file suit against the third party for the enforcement of rights arising from a contract
- The registered firm attracts large capital resources from the public.
- Where there is dispute among the partners or between the partner and the Firm or between partners and ex-partners, the partners of a registered firm can file suit in the court of law.
- The registered firm can claim any outstanding balances from a third party Thorough a court of law.
- In case of registered firm, any new partners have the security of liability and May resort to the court of law in case of a dispute.
- In the case of partners leaving the firm, they cannot be made liable for any Debts incurred after leaving. This is only seen in the case of a registered Firm.