§ Mr. MitchellTo ask the Secretary of State for Trade and Industry if he will estimate the number of businesses which could be incorporated as limited liability partnerships. [82934]
§ Mr. Ian McCartneyIt is impossible to give an estimate. Provided they met the statutory requirements eventually set out in any legislation to allow for limited liability partnerships (LLPs), any business could incorporate as an LLP.
It is more helpful to consider how many businesses might be interested in LLP status, given that the vehicle will be voluntary and businesses will need to take a commercial decision about whether it is appropriate for them. The majority of interest is expected to come from those firms already operating as partnerships, though it may also be of interest to new businesses.
326WAt present there are approximately 600,000 partnerships in the UK. These encompass the full spectrum of business and industry and only a minority are likely to seek to become LLPs. Public consultation on a draft Bill and regulations has so far revealed little or no interest from the retail, manufacturing, catering and health sectors. LLPs are therefore likely to be attractive primarily to professionals such as lawyers, actuaries, accountants, and those in the construction industry (including surveyors, architects and engineers). How attractive the vehicle proves in practice would depend on the statutory requirements which are made of it, and whether the structure is considered to be appropriate. However, if one assumes, for example, that 15 per cent. would eventually choose to become LLPs this would suggest a total of 90,000. This is, though, a best guess, and cannot be quoted with any authority.
Although it is impossible to calculate the speed of take-up of LLPs, we expect that it would take a number of years before a figure of 90,000 LLPs was reached.