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Limited partnerships
A limited partnership is a type of legal entity in which there are at least two partners, one of whom has limited liability, and one of whom does not. The number of partners can be greater than two, but nevertheless each is either a general partner (unlimited liability) or a limited or silent partner (limited liability). It is important to note that for a partnership to be considered limited, there must be both general and silent partners.

As the name suggests, a limited partnership is a type of partnership, which means that there are at least two parties (partners) who agree to co-operate and share liability and income in pursuit of a common goal. While some aspects of the arrangement are dependent on the type of partnership (e.g. liability in the case of a limited partnership), the actual scope of co-operation, the extent of liability and the distribution of income can be established in a partnership contract in accordance with the partners’ wishes.

Owners of a limited partnership
By definition, the owners of a limited partnership are divided into two categories: general partners and silent or limited partners. Each party must be represented by at least one partner. The difference between the parties lies in the extent of their involvement in managing, taking liability for and sharing the company’s profits.

General partners
General partners in a limited partnership are those who bear unlimited liability for the company’s obligations. They have the right to participate in the management of the company, to vote on decisions and to determine the overall course of business development. General partners are usually also the ones who represent the company in dealings with third parties, as only they can enter into contracts with third parties on behalf of the partnership.

Limited partners
Limited or silent partners in a limited partnership are those whose liability for the company’s obligations is limited to the extent of their contributions. In other words, their liability does not extend beyond the amount they have invested in the company. This means that limited partners are better protected in the event of poor business planning and failures, but their influence within the partnership is limited as well. Limited partners cannot participate in the management of the company, i.e. they can invest, but they cannot control day-to-day operations or how their investments are managed.

https://www.confiduss.com/en/services/incorporation/structure/limited-partnership/