YritysSuomi - General partnership

General Partnership

      Auditors
     Establishment for legal purposes
     Establishment documents
     Legal acts
     Administration and organs
     Capital

There must be at least two partners (founders) in a general partnership. At least one of the partners in a general partnership must have a permanent place of residence, or, if the founder is a legal entity, be domiciled in the EEA. If none of the partners in a general partnership has a place of residence/domicile in the EEA, all partners from outside the EEA need a permit from the National Board of Patents and Registration.

No legally incompetent person, bankrupt person or anyone banned from engaging in business may act as a founder.

Auditors

The Auditing Act specifies the circumstances when an auditor must be used.

If the Partnership Agreement of the general partnership allows partnerships that meet no more than one of the following conditions in both the closing accounting period and in the accounting period preceding it may neglect the appointment of an auditor:

1) the balance sheet total exceeds 100,000 Euro,
2) net sales or corresponding earning exceed 200,000 Euro or
3) there are more than three employees on average.

The obligation to appoint an auditor also applies to a general partnership launching operations if the general partnership already has business operations that meet the conditions for auditing obligation in the launching stage.

If the Partnership Agreement does not contain any regulations on auditors, and no more than one of the conditions mentioned above are met, the partnership has not an obligation to appoint an auditor. HTM and KHT are titles for authorised auditors. HTM refers to an auditor authorised by a local Chamber of Commerce, and KHT refers to an auditor authorised by the Central Chamber of Commerce. The Auditing Act specifies the circumstances when an authorised auditor must be used. The new enterprises must appoint a KHT or HTM auditor or a KHT or HTM corporation.

The partnership agreement may, however, stipulate that the partnership shall have one or more than one auditor. The partners participating in the election of the auditor may also elect one or more deputy auditors. In a general partnership the auditor is elected by the partners with a unanimous decision, unless otherwise agreed.

The auditor must be separately elected for each accounting period, unless the term of office has been stipulated in the partnership agreement. The auditor's term of office ends after the delivery of an auditor's report for the last accounting period during his/her term of office. If an auditor has been appointed until further notice, the term of office ends when a new auditor is appointed.

Establishment for legal purposes

A general partnership is established through a partnership agreement between the partners. A written agreement is required for the trade register.

Establishment documents

When a general partnership is entered in the trade register, a written partnership agreement is required as an attachment to the notification form.

Legal acts

Each partner in a general partnership is entitled to represent the partnership and sign for the partnership in matters related to the partnership?s line of business. This right may be restricted through an agreement between the partners by removing the right of one or more partners to represent the partnership or by stipulating that two or more partners together have the right to represent the partnership. This restriction must be submitted for registration in the trade register. The restriction is valid concerning a third party of the promulgation from the date of registration in the trade register. See also Administration and organs.

Holder of procuration

In a general partnership partners may together authorise a designated person as their holder of procuration by granting him/her a procuration. The power of attorney granting the procuration authorises the holder of procuration to act for the company in all matters related to its business. In a general partnership procurations may be given by all the partners together. It is possible to stipulate that the holder of procuration may only sign for the partnership jointly with one or more partners. Unless otherwise agreed, procurations may be cancelled by any partner, who, alone or together with another partner, is entitled to act for the partnership.

There are no statutory requirements concerning the citizenship or place of residence of the holder of procuration. The holder of procuration may be entered in the trade register.

Representative

A general partnership must have a representative who is domiciled in Finland. The representative is entered in the trade register. If the partnership has a partner, Managing Director or holder of procuration who has been entered in the trade register and who is domiciled in Finland, a separate representative is not required.

Administration and organs

A general partnership does not have any statutory organs. A general partnership may have a Managing Director, a Board of Directors and a meeting of partners, if these have been agreed on. The Managing Director, if any, must be submitted for registration in the trade register. The Managing Director of a general partnership is entitled to represent the partnership in matters relating to its day-to-day management. The Board of Directors and the meeting of partners are not entered in the trade register.