What does LLP mean in LAW & LEGAL

An LLP, or limited liability partnership, is a hybrid legal entity that combines elements of both partnerships and corporations. It offers the benefit of personal asset protection for its members, similar to that offered by corporations, but without being subject to income taxation at the corporate level.

Any individual or business entity can become an owner in an LLP as long as they agree to accept the liabilities associated with being a partner in the company. In addition, some countries may place restrictions on who can become owners of a particular type of LLP depending on their regulations.

Partners in an LLP generally have broad powers when it comes to controlling the operations and decision-making processes of the company. They are also able to assign different levels of authority to other individuals within the firm, such as managers or employees, or allow them certain investments and borrowing rights.

Profits and losses are typically allocated equally amongst all members in an LLP regardless of their ownership percentage or investment amount. This differs from traditional partnerships which use ownership percentages to determine each partner's share of profits and losses.

LLPs are popular among professional services firms such as accounting firms, law firms, architects, and other organizations where the majority of owners provide their expertise rather than actively managing day-to-day operations. They also offer benefits to businesses operating in industries with high risks due to risks posed by customer relationships or products/services provided by suppliers/vendors.