Limited liability, unlimited potential
(IHT/Asahi: September 14, 2004).
.... The Japanese version of the limited liability partnership, or LLP, is expected to make it easier for small, technologically strong players to work with established corporations in such areas as content, computer software and pharmaceuticals.
As the name implies, LLPs limit the liability of equity investors up to the amount of their investment. At the same time, they open up the possibility of flexible profit-sharing.
... legal loopholes...the partnership be exploited to evade taxes-a point of concern for Finance Ministry officials.
When an LLP incurs a deficit, equity investors will be able to deduct their shares of losses from their incomes. Experts say companies may thus conspire to allow an LLP to rack up losses to curtail the profits from their mainstay operations.
