Rhode Island introduces relevant updates to their Uniform Limited Partnership Acts

Submitted by UCS on October 14, 2022

Rhode Island has enacted the Revised Uniform Limited Partnership and the Uniform Partnership Acts which will take effect January 1, 2023.   These laws will benefit/impact partnerships in the following ways:

What the new law does: Revised Uniform Limited Partnership Act –  H7603 / S2812 

• Limited Partnerships being formed in Rhode Island will have a self-contained statutory authority to rely upon, making it easier to identify the laws that govern them.
• Existing Limited Partnerships will be allowed to opt to become Limited Liability Limited Partnerships (LLLPs).
• Limited Partners will be provided a full, status-based shield against liability for entity obligations, even if the Limited Partnership does not register as a LLLP.
• Limited Partnerships and LLLPs will be permitted to have a perpetual status and will be required to file an annual report and maintain a registered agent for service of process. Existing partnerships will be required to file their first annual report by May 1, 2024.

What the new law does: Revised Uniform Partnership Act – H7753 / S2813 

Secretary Gorbea took another step to strengthen and modernize the laws that protect our small business community by getting the Uniform Partnership Act enacted into law. The law, which takes effect on January 1, 2023, will impact partnerships in the following ways:

• Under the new law, partnerships will be defined as an entity and treated as a distinct body placed between the partners and the partnership assets.
• A partnership will be able to own property and sue and be sued in its own name.
• The act clearly outlines conditions for amending a partnership agreement, merging with another entity, having interest exchanges, converting to and from a partnership, and re-domesticating partnerships to Rhode Island.
• Clear instructions on the formation of a partnership are provided together with guidance on how to properly create agreements and tailor management structures.
• The act establishes basic standards of conduct for partners.
• The act also establishes perpetual status for registered Limited Liability Partnerships and, as such, LLPs will be required to file an annual report and maintain a registered agent for service of process. Existing Limited Liability Partnerships that conform to this act will be required to file their first annual report by May 1, 2024.

Why it matters: 

Both Uniform Partnership Acts are adapted from model legislation created by the Uniform Law Commission. To ensure these pieces of legislation were right for Rhode Island, each Act was reviewed by the state’s Uniform Law Commissioners, the Business Services Division, and several local law practitioners.

States that adopt model acts establish consistency with respect to formation requirements and business practices, creating business environments with more predictable legal outcomes. Clear and predictable laws and processes are the building blocks necessary to foster a business-friendly climate and reduce the overall cost of doing business in Rhode Island.

Updated applications are expected in the coming weeks.

United Corporate Services, Inc. can provide assistance with all Rhode Island registrations and serve as registered agent.  Please contact a Client Service Representative at info@unitedcorporate.com or call (800) 899-8648.