How to Form a Private Equity Fund in the UK

How to Form a Private Equity Fund Vehicle in the UK

In the UK, many private equity fund structures are established using an English Limited Partnership (ELP). This structure is governed by the Limited Partnerships Act 1907 (the “1907 Act”) and the Partnership Act 1890 (the “1890 Act”). Below is an overview of the key steps and legal considerations involved in setting up an ELP for a private equity fund.

1. General Structure and Participants

An ELP must consist of at least one General Partner (GP) and one Limited Partner (LP). The GP manages the fund, while the LP is the passive investor. The GP may be a natural person, corporate entity, or partnership with legal personality.

To avoid falling within the Companies and Partnerships (Accounts and Audit) Regulations 2013 (which would require public filings), GPs are typically structured as Limited Liability Partnerships (LLPs) rather than limited companies.

2. Capital Contributions

While GPs are not required to contribute capital, LPs must do so to obtain limited liability status—though this can be a nominal amount. In Private Fund Limited Partnerships (PFLPs), this requirement is waived for LPs.

3. Limited Partnership Agreement (LPA)

The rights and obligations of GPs and LPs are governed by the Limited Partnership Agreement. This agreement outlines the fund’s terms, governance, investment policy, and distribution waterfall. The LPA is a private document and does not need to be filed with Companies House.

4. Name and Registration

The name of the partnership must end with “Limited Partnership” or “LP”. Registration is done by submitting:

• Form LP5 – for standard ELPs
• Form LP7 – for PFLPs

Key information required includes:

• Name of the partnership
• Principal place of business
• Nature of business
• Names of the GP and LPs
• Capital contributed by each LP
• Duration of the partnership

Each form must be signed by all GPs and LPs. The registration fee is £20 (standard) or £100 (same-day service, if submitted before 3pm).

5. Filing and Gazette Notices

Applications must currently be submitted in paper form—there is no online submission portal. Since COVID-19, same-day registration services have been suspended.

Subsequent changes (e.g., GP/LP information, capital amounts) must be reported to Companies House using Form LP6 within seven days. Late filings incur a fine of £1 per day.

Additionally:

• If a GP resigns or becomes an LP, a notice must be published in the London Gazette
• If an LP transfers its interest (standard ELPs only), it must also be gazetted

The Gazette publication fee is currently £109.20 + VAT.

6. Certificate of Registration

Once successfully registered, Companies House issues a Certificate of Registration. This confirms the legal formation of the ELP and, where applicable, its designation as a PFLP. This certificate is the official legal record that the fund exists as a limited partnership from the date of registration.