Question

What are some of the restrictions that a partner might have trying to sell their partnership interest to a third party? Do you think that this is important?

Answer 1

A partner may be restricted from selling his interest in the form to a third party by the provisions of the partnership deed which can stipulate that for a partner to do so, he should get the consent of the remaining partners or majority of the partners as the case may be.

Yes, this restriction is important because the exit of the managing partner may even affect the continuity of the business. So to do so, he should get the consent of the remaining partners. It may also happen that the third party to whom the interests are being transferred is not capable enough to carry the business operations. So to reduce the kind of situations it is important to have restrictions on partners trying to sell their partnership interest to third party.

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