Article by Simon Greenly and Ed Smerdon
On 6th April 2001, Great Britain saw the creation of a new legal entity, the Limited Liability Partnership (LLP).
Partners in the largest professional firms have welcomed (and indeed lobbied for) this fundamental change in the law with four out of the largest seven accountancy firms apparently having immediate plans to convert to LLP status. The single biggest advantage of conversion for individual members (ie partners) under the new regime is their personal protection against catastrophic negligence claims as the LLP’s liability is limited and individual members are no longer jointly liable for claims against their co-members.
The DTI estimate that approximately 10% of the 650,000 partnerships in the UK will convert to LLP status, but survey evidence suggests that the majority of firms (other than the largest partnerships) have not yet formulated their strategy for conversion. Therefore, in the context of a competitive market, individual
