PM256900 - Indirect influence

ITTOIA/S863C

The test in Condition B is whether that member has significant influence.

Indirect influence, such as by being a director of another member, is not taken into account. Such indirect influence does not derive from the rights or duties of the individual as a member of the LLP.

Example

This example illustrates the position where there is a corporate member.

T is a member of the STU LLP and also a director of STU Ltd, the corporate member. Under the LLP agreement, control of the STU LLP is vested in the corporate member.

In her own right, T does not have significant influence. STU Ltd, of which she is a director, does have significant influence but this “indirect” influence is not taken into account. T therefore satisfies Condition B.