Public Consultation on Reforms to the Irish 1907 Limited Partnership

The Department of Enterprise, Tourism and Employment (the DETE) recently launched a public consultation on a number of significant proposed reforms to the Limited Partnerships Act 1907 (the 1907 Act). The consultation forms part of the wider development of the Miscellaneous Provisions (Registration of Limited Partnerships and Business Names) Bill 2024 (the Bill) and represents a significant step towards reforming and modernising Ireland’s limited partnership framework. In this briefing, we summarise the following three specific legislative proposals under public consultation for inclusion in the Bill:

• Increase to the existing cap on the number of limited partners;
• Introduction of a whitelist of permitted activities for limited partners; and
• Permitting access to capital during the term of the limited partnership.

Background

Ireland offers a range of investment fund structures for venture capital, private equity, real asset and alternative investment strategies, including traditional regulated structures such as the Irish Collective Asset-management Vehicle and Investment Limited Partnership (ILP) and unregulated structures such as the 1907 Limited Partnership (1907 LP) established under the 1907 Act.  

The current consultation in respect of the reform of the 1907 LP centre on facilitating investment and ease of doing business, enhancing legal certainty, ensuring appropriate levels of transparency and regulatory insight and strengthen Ireland’s competitiveness as a leading EU domicile for private investment funds. The DETE are seeking submissions in response to the consultation to be received on or before 14 August 2026. 

Summary of Key Proposals

1. Increase in Maximum Number of Limited Partners

Under the current 1907 LP rules, limited partnerships are generally capped at 20 limited partners (extendable to 50 limited partners under certain conditions where the 1907 LP permits the provision of investment and loan finance and ancillary facilities structures). Stakeholders have indicated that the cap constrains investor access to the 1907 LP and creates administrative complexity (for example, when there is a need to establish a parallel 1907 LP to enable a new cohort of limited partners to invest in the same strategy). 

The DETE proposes increasing this limit to 149 partners, aligning the 1907 LP with the maximum membership threshold for private companies limited by shares.

2. Introduction of a Whitelist of Permitted Activities of Limited Partners

The 1907 Act provides that a limited partner may lose its limited liability if it participates in the management of the 1907 LP. However, the 1907 Act does not define what constitutes “management”. The DETE is proposing to introduce a statutory “whitelist” of activities that limited partners may undertake without being deemed to participate in management (similar to the whitelist that was introduced in ILP regime), such as approving key decisions, advising or consulting with the general partner, voting on specified matters and acting in roles connected with the partnership structure. This proposal would also align Ireland with other jurisdictions with comparable limited partnership structures such as the UK, Luxembourg and the U.S., which provide for statutory whitelists of permitted management activities of a limited partner.

3. Access to Capital

The consultation considers reforms to the capital contribution rules for limited partners. Under the 1907 Act, a limited partner may lose its limited liability status if it withdraws its capital contribution during the limited partnership’s term. The DETE proposes a more flexible framework permitting a controlled mechanism for access to capital, allowing withdrawal or adjustment of capital contributions subject to safeguards, such as solvency requirements, creditor protection measures, and appropriate disclosure and filings.

Significance 

The proposals in the consultation are of relevance to asset managers, sponsors and investors currently using or thinking of using the 1907 LP and, if implemented as part of the Bill, which currently focuses on providing for additional transparency and increased investor safeguards, will add capital flexibility, certainty and additional distribution capabilities to an already successful 1907 LP. 

Conclusion  

This consultation forms part of the Government's broader policy focus on the continued development of Ireland's private assets industry and feedback received through the consultation process will inform the further development of the Bill and shape the future direction of Ireland's 1907 LP, so that the 1907 LP continues to remain an attractive alternative investment fund structuring option.

For more information and advice on these updates, please contact David Naughton or Mina Dawood (mdawood@byrnewallace.com) of our Investment Funds and Financial Services Regulation Department and Emmet Scully of our Venture Capital and Private Equity Team or your usual BWS contact.