The need of a minimum of seven members for any business to be turned into a Private Limited Company has been abolished with the introduction of the companies amendment act of 2017. Any entity, whether it be an LLP, partnership firm, co-operative society, or any other business entity created under any other legislation, with a minimum of two members can be registered as a private limited company under the modified section 366 of the corporations Act, 2013.Other conditions must be met for the conversion to happen, including getting consent from all partners and secured creditors, publishing a notice in the newspaper asking for objections in both English and the vernacular, getting a NOC from the registrar where the LLP is registered, and then going through the private limited company incorporation process.

If you want to grow your small or medium-sized business into a larger one or inject equity money, you should consider converting your limited liability partnership into a private limited company.

The alternative choice available to the LLP partners is to form a separate Private Limited Company and then transfer the entirety of the LLP’s business to the company through a written agreement, which does not require the fulfilment of the aforementioned requirements, such as the requirement for having a minimum of two partners and newspaper advertisement. However, such a transfer through a written agreement will be subject to stamp duty.