LIMITED PARTNERSHIP BY SHARES

A partnership limited by shares is a hybrid between a partnership and a limited liability company. The capital and ownership of the company is divided between shareholders who have a limited liability and one or more partners who have full liability for the remainder of the company's debts. The partner(s) will usually direct the operations of the company while the shareholders are passive investors.

Features
a) It has two categories of shareholders, the general (active) partners and the limited (sleeping) partners; in order to set up the company, it is necessary a minimum number of two shareholders ; c) The company deeds of establishment are the contract of association and the by-laws which may be drawn-up under the form of a single writ, called memorandum of association; the memorandum of association in an authentic form is not necessary, with the usual exceptions, the company set up by public subscription or land brought as contribution in kind to the share capital; d) It may be set up both simultaneously and in a continuous form (by public subscription); e) The company sign contains its own denomination, different from that of other existing companies, accompanied by the specification limited partnership by shares , written in full ; f) It is subject to legal dispositions incidental to joint stock companies with reference to the share capital, to its division into shares, the kinds of shares, the issue of bonds, general assemblies, auditors; g) The company administration may be organized exclusively according to the rules of the unitary system; the administrators may be assigned only from amongst the active partners, i.e. of those with unlimited and joint liability ;

It is a form of company little met in practice. The disadvantages it shows for the sleeping partners who, though they provide the consistency of the share capital, they may not participate in the administration of the company only if they waive their limited liability, may offer the explanation of this reality. Moreover, the fact that most of the legal dispositions which govern it belong to the joint stock company, makes easy to explain the preference for this second legal form compared to which the limited partnership by shares has only disadvantages.