Abstract:
A limited liability partnership is an alternative corporate business form that gives the benefit of
limited liability of a partnership and the flexibility of a partnership. It can continue in existence,
irrespective of the changes of the partner’s. Further, no partner is liable on account of the
independent or unauthorized actions of other partners; thus, individual partners are shielded
from joint liability created by another partner’s wrongful and misconduct professional services
rendered. This study assesses the implication of foreign experience of limited liability
partnerships with newly adopting limited liability partnerships in Ethiopia. In the critical
analysis of LLP with foreign experience, evaluate the loopholes and challenges of
implementation in the legal regime of Ethiopia. Critical shortcoming legal regimes in Ethiopia
fill an inherent legal gap between partnerships and companies registered under the Commercial
Code. In the absence of a suitable legal environment for professionals’ services, the number of
unincorporated businesses is increasing. In consequence, there exists a disparity between the
rates of incorporation vis-à-vis growth in limited liability partnerships. With increasing growth
in Ethiopia’s commercial landscape, there exists a need to have a new business entity form that
has the flexibility of a partnership alongside maintaining the benefits of a company. The inherent
gap of partnership in Ethiopia and the recent development of the LLP legal framework are
analyzed with those jurisdictions that have adopted LLPs and assessed in the manner in which
LLPs are to be implemented in the new Ethiopia’s corporate system. Consequently, the general
concept of LLP is scrutinized, compared, and evaluated to ensure its application in the Ethiopian
legal system.
